Crypto Class Actions: Court Denies MDL, Cases Split Across Three Courts
Court Blocks Crypto Class-Action Consolidation
Three separate suits alleging unregistered crypto sales now face different judges and slower timelines after a federal panel refused to merge them into one proceeding.
The Judicial Panel on Multidistrict Litigation turned down plaintiff Anthony Motto’s request to pull the Greene case from Chicago together with similar actions in Los Angeles and Philadelphia. Motto argued that common questions about whether the tokens are securities justified one courtroom; the panel disagreed, leaving each case on its own docket.
The plaintiffs claim the issuers sold digital assets without proper registration, violating federal securities law. Motto’s motion asked the panel to create a single multidistrict docket in the Northern District of Illinois so discovery, expert reports, and rulings on the securities question would be uniform. Opposing parties countered that the products, marketing, and purchasers differ enough to make joint handling inefficient.
Judges found the factual overlap too thin to justify the administrative burden of centralization. They noted each complaint targets distinct tokens and sales channels, making coordinated discovery less useful than in classic securities fraud MDLs. The panel’s order leaves the three suits to proceed independently, with each district court deciding the securities-classification issue on its own record.
Without consolidation, defendants avoid the risk of a single adverse ruling that could pressure settlements across all cases. Plaintiffs lose the leverage of unified discovery and must finance three parallel fights. The decision also signals that future token cases will be harder to bundle, raising litigation costs for both sides and giving issuers more room to fight classification claims one venue at a time.
Exchanges and DeFi protocols gain breathing room; the SEC’s ability to drive broad precedent through a single proceeding is diluted. Token projects now face scattered rather than synchronized legal risk, lowering the chance that one loss forces industry-wide concessions on registration. Traders should watch how individual courts treat staking rewards and liquidity-provider tokens—the next real test of whether decentralization claims can survive without a unified docket forcing answers.
Decentralized projects just bought time, but scattered rulings could still paint them into a regulatory corner.
