Osterer Case Reopened by Appellate Court
An Appeals Court has ruled that the lower court erred in dismissing a case for lack of jurisdiction, allowing a plaintiff to refile a lawsuit against the Binance exchange at the state level. Michael Osterer, the plaintiff, has been granted the opportunity to pursue his claim for $80 million in Bitcoin that he alleges were stolen from his account.
The case reopens after the appellate court ruled that the trial court erred in concluding that it lacked personal jurisdiction over Binance. This decision signifies a crucial turning point for the plaintiff, who had his initial case dismissed. The appellate court's decision challenges the notion that Binance can automatically evade jurisdiction simply because it is an offshore platform.
Plaintiff's Allegations Against Binance
The plaintiff claims that 1,000 BTC were stolen from his account and subsequently laundered on Binance. Osterer argues that the platform was negligent, breached its contract, and contributed to the laundering of stolen property by failing to immediately freeze the funds after being notified of the theft. He seeks to recover the entirety of the $80 million lost, plus corresponding interest.
Implications of Jurisdiction and Binance's Legal Challenges
Despite Binance Holdings Inc. being domiciled outside of Florida, the new ruling allows the plaintiff to argue that the exchange has sufficient ties to the state for the lawsuit to be heard in local courts. The appellate court challenged the original dismissal, suggesting that California law could plausibly apply.
For Binance, this reopened case is particularly delicate at this moment. It adds to a growing list of legal issues that include accusations of failing to secure or freeze stolen assets. The revival of this $80 million Binance lawsuit in Florida highlights the regulatory and compliance challenges facing the world’s largest cryptocurrency platform.
Recently, the company was singled out in a case that accuses it of helping to transfer millions of dollars to US-designated terrorist organizations, such as Hamas and Hezbollah, a lawsuit filed by victims of attacks in Israel. Pressure on the platform intensifies due to the accusation of transferring more than $1 billion to accounts linked to groups designated as terrorists, including $50 million sent after the October attacks.