On July 6, 2022, a proposed class action was commenced in the Ontario Superior Court of Justice against Voyager Digital Ltd (“Voyager Digital”) and other defendants. The proposed class action is brought on behalf of investors who acquired Voyager Digital securities on the secondary market between October 28, 2021 and July 5, 2022.
Voyager Digital, through its wholly owned subsidiaries, lends the cryptocurrency assets that it holds for its largely retail customer base to third parties in return for interest on those cryptocurrency assets.
The action alleges that the defendants made misrepresentations about its loan to third parties and the due diligence it conducted. Among other things, it is alleged that the Defendants failed to disclose the substantial unsecured loan to Three Arrows Capital – a hedge fund with significant exposure to the failed Terra/Luna cryptocurrencies and Terra platform. It is further alleged that instead of disclosing this material fact and the precarious financial position that this put Voyager Digital in, the Defendants instead misrepresented that its loan counterparties were not exposed to any Terra/Luna contagion and that it had taken a low-risk approach to lending and asset management.
The Plaintiff alleges that the misrepresentations were corrected on June 22, 2022 (when Voyager Digital disclosed the loan to 3AC) and July 6, 2022 (when Voyager Digital disclosed that it was commencing a voluntary Chapter 11 process in the US Bankruptcy Court of the Southern District of New York).
An ad hoc committee of Voyager Digital Ltd. shareholders has been formed to represent shareholders in the U.S. insolvency proceedings.
If you believe you may be a class member and wish to receive updates on the class action, we encourage you to complete the information form below.
FAQs
What is a class action?
A class action is a lawsuit that is brought by one or more persons on behalf of a larger group of people whose claims share common legal and/or factual issues. Class actions provide a cost-effective way for groups of people with common interests to pursue a legal claim.
What does “certification” mean?
Certification is the motion where the court determines whether the action can properly be pursued as a class action. The court will consider factors such as whether the claims of the class members raise common legal and/or factual issues and whether a class action is the preferable method of pursuing the claims (as opposed to other methods, such as individual actions).
Do I have to pay anything to participate in the class action?
Class action lawyers are usually paid on a contingency basis. This means that class counsel are only paid if successful. Class counsel are paid a percentage of any settlement or court award. Class counsel fees are subject to court approval.
Can I join the class action?
There are no steps required to “join” the class action. Assuming you fall within the scope of the class definition, you are automatically included in the class action unless you “opt-out” (exclude yourself from the class action).
Can I opt-out of the class action?
Once the class action has been authorized or certified, you will have the opportunity to opt-out of the class action within a period of time to be determined by the Court. If you exclude yourself, you will not be entitled to any compensation awarded under a settlement agreement or court order. You may however pursue your own action on an individual basis.
Generally, class members will wish to exclude themselves from a class action if they intend to bring their own individual action. In the majority of cases, it will be more economical to participate in the class action because the legal costs will be shared among a very large number of people.
I still have a question. Who should I contact?
If you have any other questions, please complete the Get in Touch form below.