NEW YORK, Jan. 19, 2023 (GLOBE NEWSWIRE) -- Pomerantz LLP announces that a class action lawsuit has been filed against Gemini Trust Company, LLC, and certain officers. The class action, filed in the Supreme Court of the State of New York, County of New York, and docketed under Index No. 650076/2023, is on behalf of a class consisting of all persons and entities other than Defendants that invested in Gemini Earn (also referred to herein as “Earn”) or otherwise purchased Gemini Interest Accounts (“GIAs”) and were harmed thereby. Plaintiff pursues claims against the Defendants under the Securities Act of 1933 and the New York General Business Law, as well as common law claims for fraudulent inducement, fraudulent concealment, fraudulent misrepresentation, negligent misrepresentation, breach of contract, unjust enrichment, and civil conspiracy.
If you invested in Gemini Earn or otherwise purchased GIAs and were harmed thereby, a copy of the Complaint can be obtained at www.pomerantzlaw.com. To discuss this action, contact Robert S. Willoughby at newaction@pomlaw.com or 888.476.6529 (or 888.4-POMLAW), toll-free, Ext. 7980. Those who inquire by e-mail are encouraged to include their mailing address, telephone number, and a summary of their transactions in Gemini Earn and/or GIAs.
Gemini is a privately-owned cryptocurrency exchange launched in 2014 by Defendants Cameron Winklevoss and Tyler Winklevoss and headquartered in New York, New York. Gemini purportedly lets customers buy, sell, trade, and securely store more than 60 cryptocurrencies. One of the products Gemini offers is the GIA, a yield-bearing account sold through the Company’s lending platform Gemini Earn, which allows users to lend out their crypto holdings in exchange for interest payments.
According to the Gemini website, the Earn platform is partnered with various third-party crypto lenders who act as “accredited borrowers” of Gemini customer assets. Gemini has stated that its partners are “vetted through a risk management framework which reviews our partners’ collateralization management process.” Moreover, the Company stated that customers were able to “redeem [their] assets at any time[,]” and “in all cases our partners are required to return your funds to you within five business days.” Gemini’s primary third-party partner at all relevant times was Genesis Global Capital, LLC (“Genesis”).
In early November 2022, the cryptocurrency exchange FTX experienced a significant liquidity crisis after it was revealed that customer assets had been misappropriated to cover the trading losses and repay the outstanding debts of Alameda Research (“Alameda”), a crypto-trading firm founded by FTX’s former Chief Executive Officer Sam Bankman-Fried. On November 14, 2022, Gemini sent an email assuring its customers that Gemini had no exposure to FTT tokens or Alameda and no material exposure to FTX.
However, on November 16, 2022, Gemini announced that Genesis had halted customer withdrawals upon realizing it would not be able to return customer funds within the five-business day timeframe advertised on the Gemini Earn website. Gemini subsequently paused withdrawals on the Earn program. Market publications later revealed that the ban on withdrawals came after Genesis suffered losses of over $1.8 billion from loans it made to failed crypto firms including Alameda.
As a result of Defendants’ wrongful acts and omissions, investors in Gemini Earn and GIAs have suffered significant losses and damages.
The Pomerantz Firm, with offices in New York, Chicago, Los Angeles, London, and Paris is acknowledged as one of the premier firms in the areas of corporate, securities, and antitrust class litigation. Founded by the late Abraham L. Pomerantz, known as the dean of the class action bar, the Pomerantz Firm pioneered the field of securities class actions. Today, more than 80 years later, the Pomerantz Firm continues in the tradition he established, fighting for the rights of the victims of securities fraud, breaches of fiduciary duty, and corporate misconduct. The Firm has recovered numerous multimillion-dollar damages awards on behalf of class members. See www.pomerantzlaw.com.
CONTACT:
Robert S. Willoughby
Pomerantz LLP
rswilloughby@pomlaw.com
888-476-6529 ext. 7980
