The lawsuit against PoolTogether was filed in late 2020 by software engineer Joseph Kent. At the time, the would-be plaintiff was working as a technical campaign manager for Senator Elizabeth Warren’s presidential campaign;
In his lawsuit, Kent called PoolTogether an illegal casino organizing lotteries. The plaintiff alleges that the platform violates New York State gambling laws by defrauding consumers and evading financial oversight.
PoolTogether founder Leighton Cusack challenged the suit, questioning Kent’s motives. PoolTogether’s defense argues that plaintiff suffered no loss by investing in the PoolTogether fund. Lawyers are sure: the author of the claim deliberately invested money only to have the opportunity to sue the platform.
Judge Frederic Block agreed with PoolTogether’s arguments, dismissing Kent’s claim. The judge declared that the legality of the platform’s activities should be reviewed by a New York state court because no evidence of wrongdoing had been presented at the federal level.
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“Putting money into PoolTogether was a matter of choice.. The user did it voluntarily. We are dealing with the latest technology, and there are many unanswered questions in this brand-new field. No doubt the plaintiff has genuine concerns about the PoolTogether platform, including compliance with New York law, but suing in federal court is hardly an appropriate way to address the issue,” said Frederick Block.
Recall that in May, the New York Attorney General’s Office proposed legislation expanding the agency’s authority to regulate the cryptocurrency industry in the state.