Digital Currency Group hired Barry Berke, a lawyer who played an important role in the impeachment of former President Donald Trump, to defend the company in a lawsuit brought by the New York Attorney General.
Berke is partner and chair of the litigation department at Kramer Levin and served as chief counsel to the U.S. House of Representatives during both impeachment proceedings of Trump.
New York Attorney General Letitia James sued DCG and its subsidiary, crypto lending firm Genesis, as well as former Genesis CEO Michael Moro and DCG CEO Barry Silbert last month for allegedly defrauding investors. James’ office also sued crypto exchange Gemini for similar charges.
“It is truly a privilege to represent DCG in this case,” Barry Berke said in a statement. “This misguided and meritless lawsuit proves the adage that ‘no good deed goes unpunished.’ It completely disregards and distorts DCG’s good-faith efforts to support its subsidiary, their clients, and the overall industry. We look forward to demonstrating that DCG and Barry Silbert should never have been sued, and the allegations against them are plainly wrong as a matter of fact and law.”
The charges
According to the attorney general’s complaint, Gemini lent funds to Genesis as part of its Earn program. These funds were ultimately lent out to counterparties including Three Arrows Capital and Alameda Research. When multiple bankruptcies in the space caused defaults to Genesis, it was left with a $1 billion hole. In covering up this hole, DCG claimed it had absorbed the losses when it had only made a promissory note to its subsidiary Genesis.
The attorney general said Gemini lied to investors about Gemini Earn and said Genesis, DCG and executives tried to hide more than $1.1 billion in losses.
