Magistrate Judge Recommends Dismissal of Lawsuit Against Crypto Trading Platform B2C2

News | April 11, 2024 By:

On Tuesday, March 19, 2024, United States Magistrate Judge Robyn F. Tarnofsky recommended that a motion to dismiss filed by cryptocurrency trading platform B2C2 USA Inc. and B2C2 Ltd. against referral company Staffing Global Corp. be granted.

Staffing Global had filed a lawsuit against B2C2 in April 2023, alleging breaches of an oral agreement and a written referral agreement between the two companies. Under the alleged oral agreement made in February 2019, Staffing Global claimed it was owed five percent of sales commissions if it introduced sales prospects to B2C2 that were later converted into clients.

However, Judge Tarnofsky found that the oral agreement was not enforceable due to the statute of fraud. While New York law allows for exceptions if an oral contract is acknowledged in writing, the judge determined that a text message from B2C2 mentioning a “2bp fee” did not match the terms claimed in the oral agreement.

Staffing Global also claimed B2C2 breached a written referral agreement the companies entered into in December 2019. This agreement provided compensation if a referred prospect became a B2C2 client within three months of introduction. Staffing Global pointed to cryptocurrency firm Osprey Funds as one example, but Judge Tarnofsky ruled the complaint did not clearly state that Osprey had signed on as a B2C2 client within the required time frame.

In addition, the judge dismissed Staffing Global’s alternative unjust enrichment claims. Any pre-referral agreement claims were barred by the statute of frauds, as they duplicated the invalid oral agreement. Post-agreement unjust enrichment claims could not proceed since they replaced the existing written contract whose validity was not challenged.

While leaving open the possibility for Staffing Global to file an amended complaint with clearer allegations, Judge Tarnofsky found the problems with the current claims were substantive. B2C2 operates a popular cryptocurrency trading platform that allows clients to trade digital currencies like Bitcoin and conduct blockchain transactions. However, the complaint did not provide enough supporting details to show Staffing Global had met its obligations for client referrals as outlined in its agreements with B2C2.

The recommendation must still be approved by United States District Judge Analisa Torres, who has scheduled a case management conference for June 11, 2024. If adopted, the dismissal would end Staffing Global’s lawsuit unless it chooses to file a second amended complaint with strengthened allegations within a certain timeframe.

Please contact BlockTribune for access to a copy of this filing.