Tezos will stop fighting all the lawsuits that are ongoing since 2017 and will not be finally settled. The decision came because of the rise in legal costs and Tezos still believes that its ICO didn’t do anything wrong. This outcome will not influence directly on the matter whether Tezos is considered a security or not.
The Tezos Foundation announced that it will reach all settlements for the ongoing class-action lawsuits and those who are worried whether TEzos is a security or its ICO was conducted improperly, can now reconsider and think whether the investors were misled at the time. The legal costs are the central point of why Tezos decided to settle. The Tezos Foundation will maintain all lawsuits as meritless and adds that ‘’it continues to deny any wrongdoing’’ but it admits that the lawsuits were a huge burden:
“Lawsuits are expensive and time-consuming, and it was decided that the one-time financial cost of a settlement was preferable to the distractions and legal costs associated with continuing to fight in the courts.”
As with other class-action lawsuits, it seems that some that were fined against Tezos is a copycat that make almost identical claims. The investors filed four lawsuits against Tezos in 2017 and one of them was still underway in federal courts in 2019. Tezos was overwhelmed with legal cases and some rulings were even decided in the platform’s favor. Courts in California dismissed two cases against the platform in 2019 which is expected to dismiss all future lawsuits.
The Tezos Foundation has not yet settled in court and many of the details remain unknown. There are many class-action lawsuits and it is not clear how many people will actually file a claim when the time comes. Tezos will explain further shortly, adding to the previous explanation:
“Settlement funds will be distributed to those in the settlement class who file valid claim forms. The settlement class would consist of those who participated in the 2017 fundraiser, but would exclude the defendants and certain of their affiliates.”
The company doesn’t not yet how much the settlement will cost and the plan of the distribution still has to be determined. The interesting thing is that other crypto companies are also affected by lawsuits including Ripple, Elastos, and Bitfinex.
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