Nikolas Sargeant
Judge Barbara Rothstein approves transfer request citing "first-to-file" rule to avoid duplicate litigation across jurisdictions.
A U.S. judge has granted Binance's motion to transfer a money laundering lawsuit from Washington to the Southern District of Florida, where similar litigation is already underway. The ruling, issued by Judge Barbara Rothstein on April 21, prioritizes judicial efficiency and aims to prevent parallel proceedings.
Washington Case Consolidated with Earlier Florida Litigation
Judge Rothstein determined that both lawsuits fundamentally involve the same core allegations—cryptocurrency owners whose assets were stolen and subsequently laundered through Binance's platform. Despite plaintiffs' arguments that their Washington case introduced unique claims and named former CEO Changpeng "CZ" Zhao as a defendant, the court found the similarities substantial enough to warrant consolidation.
"Allowing two parallel class actions to proceed in separate districts would be duplicative and inefficient," Rothstein wrote in her decision, rejecting concerns that transferring the case might delay justice for plaintiffs seeking restitution.
The Washington lawsuit, filed in August 2024, came after a similar case initiated by Michael Osterer in Florida in June 2023. The Florida case was directed to arbitration in July 2024 and will now encompass the transferred Washington claims.
Legal Challenges Mount as CZ Disputes Cooperation Claims
In parallel developments, former Binance CEO Changpeng Zhao faces renewed scrutiny following an April 11 report by The Wall Street Journal claiming he agreed to testify against Tron founder Justin Sun as part of his DOJ plea arrangement. Zhao quickly denied these allegations on social media platform X.
Zhao completed a four-month prison sentence in September for Anti-Money Laundering violations, maintaining his status as the wealthiest individual to serve time in a U.S. prison with a reported $60 billion net worth.
Further complicating Binance's legal landscape, a Nigerian court recently postponed a tax evasion case against the exchange to April 30 after Binance challenged document service procedures. The company's legal team argued that the Federal Inland Revenue Service failed to obtain proper court approval for serving documents outside Nigeria's jurisdiction.
With these cases now consolidated in Florida, both Binance and affected crypto investors may see more streamlined resolution to the money laundering allegations while the exchange continues to navigate multiple legal challenges worldwide.
