DCG to End $620 Million Lawsuit With Bankrupt Lender Genesis
Digital Currency Group (DCG) has reached a revised repayment arrangement with its subsidiary, Genesis Global Holdco LLC, aiming to settle a lawsuit seeking approximately $620 million from DCG.
DCG to Pay Genesis Full Outstanding Payment By April 2024
The deal, disclosed during a Tuesday hearing, outlines that Genesis will receive approximately $200 million in value over the coming weeks. Moreover, DCG is obligated to fulfill outstanding payments by April 2024.
Court documents stipulate that if DCG defaults on this agreement, Genesis retains the right to pursue the collection of any unpaid amount. This proposed resolution aims to conclude a lawsuit initiated by Genesis in September, focusing on the recovery of outstanding loans from its parent company.
Despite DCG’s ongoing payments to Genesis since the lawsuit’s filing, court records indicate that, as of Nov. 28, the subsidiary is still owed $324.5 million.
In a recent development, Genesis Global has asserted that the newly reached agreement will circumvent extended and expensive litigation with its parent company, Digital Currency Group (DCG). The agreement ensures that the distressed crypto lender, currently undergoing bankruptcy, will receive partial repayment of its outstanding dues.
Genesis lawyer Sean O’Neal clarified that while the deal addresses specific repayment aspects, it does not serve as a comprehensive resolution for other disputes between Genesis and DCG. These unresolved matters primarily pertain to Genesis’s broader strategy for navigating its bankruptcy proceedings.
Battle With Gemini Continues
In addition to its ongoing legal dispute with former business partner Gemini Trust Co., Genesis finds itself entangled in a lawsuit filed by the US Securities and Exchange Commission (SEC). Simultaneously, New York regulators have initiated legal action against both Genesis and Digital Currency Group (DCG).
The recently unveiled agreement, which forms part of Genesis’s proposed repayment strategy for its creditors, is poised to be incorporated into the broader payout plan. Genesis will present this comprehensive plan to creditors for their approval through a voting process. The outcome of this vote will be a key factor considered by US Bankruptcy Judge Sean Lane when rendering the final decision on the proposed plan.
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