Prominent Bitcoin Treasury investors have withdrawn a proposed class action lawsuit denounced misleading shareholder executives about the risks associated with the Bitcoin-centric investment approach and recent changes to accounting rules.
Strategic Cases
Bitconist reported that the plaintiff, led by Anas Hamza, filed a class action lawsuit in US District Court for the Eastern District of Virginia, and filed a class action lawsuit against the defendants against Strategic Co., co-founder Michael J. Saylor, CEO Von Le and Chief Financial Officer Andrew Kang.
The action filed by Pomerantz LLP claimed a violation of the Federal Securities Act, particularly Section 10(b), and Section 20(a) of the Securities Exchange Act 1934. In particular, the complaint argued that the strategy underestimated the financial risks of an aggressive Bitcoin accumulation strategy and failed to share appropriate information about the expected profitability of this crypto investment.
The lawsuit also includes management’s accounting standards update (ASU) No. They claimed they did not properly disclose the potential impact of adopting 2023-08.
Plaintiff voluntarily dismisses the claim
Interestingly, in Friday’s Bloomberg Act report, the lead plaintiff and shareholders voluntarily rejected claims against Strategic Co. and its executives in a joint agreement. In particular, dismissals apply bias against designated plaintiffs. This means that the same claim cannot be amended, but this law has not been extended to potential class members.
The lawsuit covering the course period from April 30, 2024 to April 4, 2025 sought unspecified damages, legal costs and other relief. However, the decision to step back the plaintiff will end the lawsuit without trial or settlement. In previous submissions, the strategy stated that it was intended to “struggle with defense” against the allegations, arguing that disclosures regarding Bitcoin-related risks and accounting practices are accurate and complete.
With voluntary firing, the company is eschewing what could have been a long-term legal battle for major Bitcoin financial owners. The strategy recently acquired another Bitcoin bulk funds through another stock sale. The Saylor-led company reportedly used its revenue to buy 3,081 to issue new shares worth $359 million.
At the time of writing, Strategy’s Bitcoin Holdings is 632,457, valued at around $68.5 billion. Meanwhile, MSTR has traded at $334.41, a price loss of 4.43% and 10.23% over the past day and five days respectively.
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