A California judge gave preliminary approval for a $25 million settlement proposed by the Tezos Foundation to end a consolidated class-action lawsuit. Tezos Foundation raised whopping $232 million in Initial Coin Offering back in July 2017. The same year investors started filing claims against the firm, accusing Tezos of issuing unlicensed securities in the US. The judge said that the court would likely be able to approve the settlement, subject to further consideration at the settlement hearing.
The date of the settlement hearing is yet to be announced.
The court noted that they are likely to able to approve the settlement but with further consideration at the settlement hearing. The date of the settlement hearing is yet to be decided. If Tezos Foundation is found liable in the class-action lawsuit, estimates of damages range from under $1 million to more than $150 million. The $25 million settlement will provide class-action lawsuit applicants damages equivalent to between 16% and 100%, of the estimated damages.
Tezos Foundation denies investors’ claims.
In a blog post, Tezos Foundation denied any wrongdoing in its initial coin offering. The company noted that it had chosen to settle out of court because lawsuits are expensive and time-consuming, and they preferred a one-time financial cost. Tezos Foundation wrote in its blog post that they chose to settle all claims because the company believes it is in the best interest of the Tezos project and community as a whole. The company continues to believe that the lawsuits were meritless and continues to deny any wrongdoing, it added.
The US SEC is yet to build a case against Tezos Foundation, and if the current $25 million settlement is finalized, the SEC might find it more difficult to prove that the Tezos Foundation acted in bad faith. The investors of Tezos are sticking with the company despite the lawsuit and are trusting the company. The company’s assets have tripled in value since the ICO.
