US federal judge dismisses $100M class action suit against Atomic Wallet

• US judge dismissed a class-action lawsuit against Atomic Wallet due to no jurisdiction.
• The court ruled that there was insufficient evidence and that there was no deliberate Colorado targeting.
• Plaintiffs have 21 days to justify claims against shareholder Ilia Brusov.

In a recent legal victory for Atomic Wallet, a US federal judge has dismissed a class-action lawsuit against the Estonian-based crypto firm and its key figures, citing lack of jurisdiction.

The lawsuit was filed in 2023 by a group of users after Atomic Wallet suffered a $100 million hack earlier in June.

The allegations against Atomic Wallet

According to the plaintiffs, Atomic Wallet had made its app available for download in Colorado and advertised on platforms like X (formerly Twitter), which, they argued, should have established jurisdiction.

One of the plaintiffs, Graham Dickinson, a Colorado resident, claimed he had frequently communicated with Atomic Wallet’s customer service team from his home in the state.

Insufficient evidence

Judge Brimmer dismissed the plaintiffs’ argument, noting that because Atomic Wallet’s products are digital, it was unlikely the company deliberately targeted the Colorado market.

“The nature of the products at issue here — software applications — makes it even less likely that Atomic Wallet deliberately exploited the Colorado market,” Brimmer wrote in his ruling.

The Colorado District Court Judge Philip Brimmer also ruled that there was insufficient evidence to show that Atomic Wallet had significant contact with the state of Colorado, thus denying the court’s jurisdiction over the company, its CEO Konstantin Gladyshev, shareholder Pavel Sokolov, and Evercode Infinite, the software development firm responsible for the wallet’s technology.

However, while the case against most of the defendants was dismissed, the judge granted the plaintiffs an additional 21 days to explain why the claims against Ilia Brusov, a shareholder and founder of Evercode Infinite, should not be dismissed.

The judge’s ruling marks a crucial step in favour of the crypto wallet provider amid ongoing legal challenges in the aftermath of the hack.

This legal victory provides temporary relief to Atomic Wallet as it continues to navigate the fallout from the massive security breach.