COURT REJECTS BID TO CENTRALIZE CRYPTO CASES
Three separate lawsuits targeting the same crypto platform just got harder to merge. A federal panel refused plaintiff Anthony Motto’s push to fold actions from Illinois, California, and Pennsylvania into one Northern District of Illinois docket. The decision keeps the cases on separate tracks for now and leaves the legal landscape fragmented.
The motion arose after investors filed nearly identical claims accusing a digital-asset exchange of selling unregistered securities and mishandling customer funds. Motto argued that common questions of fact—token classification, marketing statements, and wallet-control issues—made consolidation efficient and necessary to avoid conflicting rulings. Opposing parties countered that the actions involve different plaintiffs, different tokens, and different state-law overlays, so one courtroom would create more logistical headaches than it would solve.
Judges on the Panel declined to create an MDL. They found the number of actions too small and the factual overlap too limited to justify forced centralization. The ruling leaves each district free to set its own schedule, discovery limits, and motion practice, preserving the possibility that three judges could reach three different conclusions on the same legal questions.
In plain terms, the Panel told plaintiffs they must litigate in the courts where they filed. Without an MDL, there is no single judge directing nationwide discovery or settlement talks, and each case proceeds at its own pace. That means defense costs stay higher and plaintiffs lose the leverage that usually comes with consolidated pressure.
For crypto markets the decision signals that the SEC’s enforcement theory—treating many tokens as investment contracts—will be tested in piecemeal fashion rather than under one roof. Exchanges and DeFi protocols gain breathing room because conflicting district rulings could slow broader enforcement momentum and keep regulatory uncertainty alive. Traders, meanwhile, must price in the risk that a single adverse verdict in any of the three venues could still ripple through token valuations even without a national template.
Expect more scattered rulings before any coherent national standard emerges.