In a recent development, a United States federal judge has dismissed a lawsuit against the decentralized finance (DeFi) platform PoolTogether.
The court ruling stated that the federal court system was not the appropriate venue for addressing concerns related to the DeFi startup.
U.S. Judge Frederic Block, while acknowledging genuine concerns about PoolTogether, ruled that a federal court was not the suitable platform to address those concerns.
The judge stated that the plaintiff, Joseph Kent, lacked standing to pursue the lawsuit as he had not suffered any concrete harm at the hands of the defendants.
The court order clarified that Kent’s lack of standing rendered the case dismissible, while alternative motions to compel arbitration were denied as moot.
Kent initially filed the lawsuit in October 2021, alleging that PoolTogether violated New York state gambling laws and allowed individuals to evade financial regulations and engage in fraudulent activities. The lawsuit described the DeFi platform as an “old-fashioned numbers racket.”
According to the judge, Kent’s claimed injury must align with the injuries he sought to remedy through the federal court. However, the judge found a mismatch in this case. Consequently, the lawsuit was dismissed.
Although the lawsuit was dismissed, the judge noted that Kent is free to pursue his claims in state court. Additionally, any remaining ancillary issues raised in the dismissal motions are to be resolved by the New York Court of Appeals.