US Court Dismisses Class-Action Lawsuit Against Atomic Wallet Over $100M Hack

A US Federal Judge has dismissed the class action lawsuit against Atomic Wallet over a $100 million hack. The judge noted that a Colorado Court lacks jurisdiction over Atomic Wallet, which is based in Estonian.

Atomic Wallet's victory extends to its CEO, Konstantin Gladyshev, and sister software entity, defendants in the suit.

Atomic Wallet Gets a Win as Court Dismisses Class Suit

Just recently, Colorado District Court Judge Philip Brimmer ordered the dismissal of a class action lawsuit against wallet.

The case includes the wallet's CEO Konstantin, shareholder Pavel Sokolov, and its software development company Evercode Infinite as defendants.

The judge's decision hinges on the suit's failure to convince the court of its jurisdictional authority over the Estonian-based firm.

In August 2023, a group of Atomic Wallet users filed a class action lawsuit against it. The plaintiffs initiated the suit after the wallet service provider suffered an exploit in June 2023, losing over $100 million from users' wallets.

The attack affected up to 5,500 crypto accounts that use Atomic Wallet. Blockchain analytics company Elliptic connected the Atomic Wallet's exploit to the notorious North Korean crime team, Lazarus Group.

Additionally, the lawsuit alleged that it made its advertisements visible in Colorado on the X platform and noted that the wallet's mobile app could be downloaded in Colorado.

Further, the suit claimed that one of the plaintiffs, Dickinson, frequently interacted with Atomic Wallet's customer service staff from his base in Colorado, US.

However, it filed a dismissal motion for the case in November last year. The crypto firm stressed that it lacked a connection in the US state from which the class suit originated.

It also pointed out thatjust one of the 21 plaintiffs, Graham Dickinson, stays in the US.

Judge Brimmer Says Colorado Court Lacks Jurisdictional Control Over Atomic Wallet

The Federal Court Judge Brimmer said the connection between Atomic Wallet and Colorado is insufficient to indicate the court's jurisdictional control over the company and other defendants in the case.

Brimmer stated: The nature of the products at issue here - software applications - makes it even less likely that Atomic Wallet deliberately exploited the Colorado market by making the applications, mnemonic keys, and security updates available to Mr. Dickinson or by sending cask back tokens to him."

Again, the judge elaborated that Atomic Wallet's products are not similar to tangible goods that can be shipped to customers from another location. Instead, they are software applications that can reach users anywhere, even without Atomic Wallet's knowledge.

However, the judge gave the plaintiffs an extension of 21 days to strengthen their arguments against the other defendant, Ilia Brusov. Brusov is a co-founder of Evercode Infinite and an Atomic Wallet shareholder.

This extension gives the plaintiffs time to prepare convincing reasons why the court should not dismiss charges against Brusov.

Atomic Wallet is a non-custodial decentralized crypto wallet that was launched in 2017. The Estonian-based crypto wallet supports over 500 digital assets.

The court order revealed ownership details of Atomic Wallet, showing that both Sokolov and Brusov each own a 12.8% stake in the company. The remaining 74.4% stake belongs to CEO Glayshev.

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