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New York Supreme Court Grants Bitfinex Stay Of Document Demands From NYAG


Cryptocurrency exchange Bitfinex, and its affiliated stablecoin issuer Tether, announced that the New York Supreme Court has granted its motion for an immediate stay of the document demands from the New York Attorney General's or NYAG office.

Bitfinex and Tether, who were involved in a legal battle with NYAG, had filed a motion on the previous day to dismiss the proceeding brought by the NYAG office. Bitfinex and Tether also sought an immediate stay of the Attorney General's document demands.

It was in late April that NYAG's office said an investigation by prosecutors found that Bitfinex lost around $850 million in customer and corporate funds, and then used funds from Tether to secretly cover the shortfall.

NYAG then said it obtained a court order against iFinex Inc., which operates Bitfinex and Tether, warning it not to violate New York law and defraud New York residents in future.

In the latest motion, the exchange noted that the NYAG office lacks jurisdiction over the companies, which do not do business in New York state. Also, New York's Martin Act does not apply to the companies' businesses. Further, the company said the Martin Act cannot be used "extraterritorially" to compel a foreign corporation to produce documents stored overseas.

The latest order, by Justice Joel Cohen of the New York Supreme Court - Commercial Division, requires the companies to produce only documents and information relevant to the limited issue of whether there is personal jurisdiction over the companies in New York but staying the document order in all other respects.

Justice Cohen scheduled a hearing on the motion to dismiss for July 29.

In mid-May, the Supreme Court had granted the company its motion to modify injunction obtained by the NYAG office against its business. That order allowed Bitfinex and Tether to continue their normal business activities.

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