A US judge rejected Binance's request to resolve customer claims through arbitration.
PANews reported on February 27 that, according to Reuters, U.S. District Judge Andrew Carter in Manhattan ruled on Thursday to dismiss Binance's request to resolve customer claims through arbitration. These customers accused Binance of illegally selling unregistered tokens that had significantly depreciated in value. The judge held that Binance failed to adequately inform users that the terms of claims arising before February 20, 2019, had been amended to mandate arbitration and waive the right to class-action lawsuits; therefore, the claims could proceed in court.
The judge pointed out that there was no evidence that Binance had "published" the arbitration clause, and that the class-action exemption in its 2019 Terms of Use was vague and unenforceable. A Binance spokesperson responded that they would actively defend the remaining valid claims in the case. Founder Changpeng Zhao is also a defendant. Customers filed the lawsuit against Binance for losses on seven tokens, including ELF and EOS, accusing the company of failing to warn of significant risks as required by securities laws. The lawsuit was dismissed in 2022 but was resumed by the appeals court in 2024.
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