Davis Polk partner Ted Polubinski discussed the firm’s complete victory for Iris Energy in a putative federal securities class action with Law.com.

The claims had challenged the accuracy of Iris’s disclosures in its November 2021 IPO and in several statements made in the months that followed the IPO. The plaintiffs sought to recover for their losses during the broad, market-wide decline in the value of bitcoin in 2022. They alleged that Iris had concealed risks in its IPO documents and other public disclosures, including about loans that Iris had secured to fund data mining equipment powered by renewable energy. The plaintiffs also asserted that Iris overstated its goodwill in its financials.

Davis Polk moved to dismiss the complaint in its entirety, arguing that none of the statements at issue were false or misleading.

“When you boil down allegations that involve matters in the crypto space and cut through the complexity, the basics of the U.S. securities laws still apply,” Ted explained. “Which is to say that the plaintiffs can’t bring claims for violations of the U.S. securities laws unless they can identify an actual false or misleading statement.”

Ted noted that “In this case, the clients at Iris were smart and critical in all of the best ways, and we worked probably more closely than I have ever worked with any other in-house lawyers on any similar motion.”

The Davis Polk team that represented Iris Energy also included partner Mari Grace, counsel David B. Toscano and associates Charlotte M. Savino, Paulina Perlin, Elaina Marx, Alyssa Metcalf and Paige Whitaker.

“Bitcoin Mining Company That Enlisted Davis Polk Beats Investor Class Action,” Law.com (October 2, 2024) (subscription required) 

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