Cryptocurrency exchange Bitfinex and stablecoin issuer Tether have already spent over half a million dollars in a continued legal battle with the New York Attorney General’s (NYAG) office.
The cost was revealed by the companies’ law firms Steptoe and Johnson LLP and Morgan, Lewis and Blockius LLP in a letter filed with the New York Supreme Court on Tuesday. The letter urged presiding Judge Joel M. Cohen to dismiss the case against Bitfinex and Tether as finding documents for the NYAG’s office has been a costly affair.
“The Respondents have already spent well over $500,000 responding to just those portions of the document demands that were carved out from the stay,” the letter reads. “The companies and their personnel use more than 10 different communications platforms – several of which are encrypted and pose substantial collection and review challenges.”
The letter adds:
“As a result, the process of responding to the carve-out from the stay involved one of the largest, most complex document collection and review effort in which undersigned counsel have ever participated, involving over 60 lawyers.”
Bitfinex CTO, Paolo Ardoino, told The Block: "I can't share the exact figure. Our costs grew significantly from the past year due to our defense vs NYAG and the work different legal firms are doing across the globe to recover Crypto Capital funds."
The legal battle is ongoing since April, when the NYAG office brought an investigation, claiming Bitfinex co-mingled funds with its sister company, Tether, to cover losses totaling $850 million. The exchange insists the NYAG lacks jurisdiction in the case since it does not serve New York customers according to its terms of service, and therefore, wants the case dismissed.
However, earlier this week, Judge Cohen decided to continue the matter, meaning a new date will be set as the court continues its consideration for another 90 days.