NEW YORK — Metropolitan Commercial Bank has secured dismissal of a 53-count lawsuit that alleged it played a complicit role in the collapse of crypto lender Voyager Digital. A federal judge ruled the complaint failed to plausibly establish claims of fraud or unjust enrichment, Law360 said.
In an order signed this week, U.S. District Judge Paul A. Engelmayer dismissed the suit but granted Voyager’s bankruptcy plan administrator, Michael Wyse, one final opportunity to amend the complaint. Wyse filed the lawsuit in November on behalf of over 30,000 former Voyager customers, seeking to hold the bank liable for losses stemming from Voyager’s collapse, Law360 said.
The complaint claimed that Metropolitan Commercial Bank appointed Voyager to solicit crypto services despite the platform being falsely marketed as safe, legal, and FDIC-insured. It further alleged the bank aided and abetted Voyager's misleading representations about the safety of customer funds and the nature of its partners.
At its peak, Voyager had more than 3.5 million users and managed over $5.6 billion in assets. The company ultimately owed U.S. customers more than $1.7 billion, much of which remains unrecovered, according to Wyse.
Judge Engelmayer said that the suit does not show any of the former Voyager customers actually relied on any alleged misrepresentation or omission, whether made by Metropolitan or Voyager, which is "fatal" to the suit's 38 fraud claims, Law360 said.
"[The complaint] does not identify a single assignor by name," Judge Engelmayer said. "It does not plead that any particular assignor saw any particular statement. It does not plead that any particular assignor relied on any particular statement in making any relevant decision, e.g., whether to deposit fiat or crypto with Voyager."
Law360 added that Wyse alleged Metropolitan's arrangement with Voyager allowed the crypto company "to reap the benefits of its fraud." And Voyager's use of the bank's good name and associated FDIC insurance in the crypto company's marketing "lent false credibility to Voyager and helped lull retail customers into believing that they could use Voyager's platform as safely as holding savings with a bank," Wyse said.