Ontario’s superior court has granted approval for a class action lawsuit against Binance, the popular cryptocurrency exchange, alleging the sale of unregistered crypto derivative products and violations of securities law.
The lawsuit, initiated by Christopher Lochan and Jeremy Leeder, alleges that Binance sold crypto-derivative products to thousands of retail traders without registering with the Ontario Securities Commission, as required by law.
According to a report by Advisor.ca, the lawsuit received certification of motion on April 19, allowing it to proceed as a class action lawsuit. This designation enables Lochan and Leeder to represent a broader group of individuals affected by the alleged misconduct without each person having to individually pursue legal action.
In approving the lawsuit, Judge E.M. Morgan acknowledged that Lochan and Leeder represent a larger group of Canadian users who claim to have invested in cryptocurrency products sold by Binance unlawfully.
“The plaintiffs have met the evidentiary burden of establishing some basis in fact that the issues raised in the liability questions are common across the class,” stated Judge Morgan.
The plaintiffs seek damages for the crypto trades conducted on the platform and the rescission of their contracts with Binance. Binance argued against rescission, claiming it was a third party to the transactions. However, the court rejected Binance’s argument, noting the absence of relevant contracts supporting its stance.
Judge Morgan remarked, “If it is the defendants’ view that Binance website users contract with each other and that Binance is only a medium for these contracts, then they could produce at least one such contract.”