Plaintiffs firm Edelson PC has asked a federal judicial panel to consolidate class actions brought over the 2014 collapse of the bitcoin exchange Mt. Gox after a federal judge last year dismantled its case under the U.S. Supreme Court's decision in Bristol-Myers Squibb v. Superior Court of California.

On Dec. 11, 2017, U.S. District Judge Gary Feinerman of the Northern District of Illinois found that named plaintiffs who weren't from Illinois lacked jurisdiction under Bristol-Myers to bring a class action on behalf of Mt. Gox customers who lost $400 million in bitcoins and U.S. dollars after the exchange's bankruptcy in 2014. On Jan. 24, Edelson, a Chicago firm founded by Jay Edelson, filed two new class actions on behalf of the dismissed plaintiffs—one in California and one in Pennsylvania. A week later, Edelson attorney Rafey Balabanian filed a motion before the U.S. Judicial Panel on Multidistrict Litigation to transfer all three cases back together before Feinerman.

“Notwithstanding Judge Feinerman's decision, the actions share almost everything in common,” he wrote in the Jan. 31 motion. “In light of Judge Feinerman's order several other individuals, who would have been members of the putative class, also have come forward wishing to file their own actions. Counsel anticipates that several more complaints, alleging materially identical injuries premised on identical facts, will be filed shortly and flagged here as potential tagalong actions.”

Jay Edelson did not respond to a request for comment.

Mizuho Bank Ltd., the Japanese bank that supported the exchange, is named in all three cases. On Feb. 22, the bank's lawyer, Jerome Fortinsky of New York's Shearman & Sterling, opposed the motion, citing numerous differences in the state law claims made in the three cases. He also noted that in the Illinois case, as opposed to the other two newly filed class actions, depositions of two expert witnesses were to be completed this week, and a motion for class certification would be fully briefed by March 22. A Shearman & Sterling representative said Fortinsky declined to comment.

The MDL panel has scheduled the cases for its March 29 hearing in Atlanta.

Mt. Gox, founded in 2009, was one of the largest bitcoin exchanges before it shut its doors and filed for bankruptcy protection in 2014. Edelson's original suit, filed on behalf of Illinois resident Gregory Greene, alleged that the exchange and its CEO, Mark Karpeles, had committed  fraud against customers who never received their deposits back amid Mt. Gox's collapse. An amended complaint added California resident Joseph Lack and named two other Mt. Gox executives and Mizuho Bank as defendants. A class action settlement contingent on Mt. Gox's sale to Sunlot Holdings fell apart, prompting the litigation to go forward. Amended complaints pared down the defendants to Karpeles and Mizuho Bank, which allegedly stopped withdrawing funds but accepted bitcoin deposits in the months prior to Mt. Gox's collapse.

In 2016, Mizuho Bank filed a motion to dismiss on jurisdictional grounds, which Feinerman rejected with the contingency that Edelson add an Illinois named plaintiff who has alleged to have deposited money with Mizuho Bank. Illinois resident Anthony Motto joined the complaint a few months later, and a fourth plaintiff, Gregory Pearce, from Pennsylvania, was added in 2017 to represent customers who attempted to withdraw funds after Mizuho Bank allegedly stopped allowing them to do so.

Last year, Mizuho Bank filed a motion to reconsider that ruling in light of Bristol-Myers, in which the Supreme Court held that most of the 600 plaintiffs suing over blood-thinner Plavix lacked specific jurisdiction because there wasn't enough of a link between their claims and California, where they filed suit.  Edelson opposed the motion, noting that Bristol-Myers was a “mass action” comprised of numerous personal injury cases, not a nationwide class action.

But Feinerman saw no difference. He granted the motion after finding “there is no meaningful difference between Bristol-Myers and this case.”

“Nothing in Bristol-Myers suggests that it does not apply to named plaintiffs in a putative class action; rather, the court announced a general principle—that due process requires a 'connection between the forum and the specific claims at issue,'” he wrote. “That principle applies with equal force whether or not the plaintiff is a putative class representative.”

Balabanian filed Lack's new class action in the U.S. District Court for the Central District of California. Jay Edelson, along with Philadelphia-based Anapol Weiss, filed Pearce's new class action in the U.S. District Court for the Eastern District of Pennsylvania.

In his order, Feinerman acknowledged that his ruling would inevitably lead to separate filings.

“The court recognizes, as plaintiffs observe, that having Pearce and the withdrawal subclass proceed in Pennsylvania while the rest of the case proceeds in Illinois is suboptimal from an efficiency standpoint,” he wrote. “But Bristol-Myers teaches that such 'practical problems' must yield to the 'more abstract matter' of whether it is legitimate to submit Mizuho to personal jurisdiction in an Illinois court for a nonresident's claims that have no tie to this forum.”