Morrison Cohen Secures Dismissal of Digital Assets Class Action Based on Class Action Waiver

On September 15, 2026, Morrison Cohen secured dismissal of a putative class action that illustrates the power of a class action waiver.

Morrison Cohen represents Euclid Labs, Inc., the operator of the Magic Eden NFT marketplace, as well as one of Euclid Labs’s officers, in Pagan v. Euclid Labs, Inc. d/b/a Magic Eden, et al., 1:26-cv-03608, a putative class action pending in the United States District Court for the Eastern District of New York arising from the $ME token.

The plaintiffs alleged that Euclid Labs and others made misleading public representations concerning the $ME token’s functionality, governance, revenue-sharing, buybacks and staking rewards. The plaintiffs claimed that a subsequent business pivot caused the token’s value to decline, causing losses.

Morrison Cohen moved to dismiss the Complaint on multiple grounds.  At oral argument before Judge Brian M. Cogan on August 20, 2026, the plaintiffs’ counsel conceded that the Court lacked personal jurisdiction over two named plaintiffs’ claims.

On September 15, 2026, the Court dismissed the claims of the remaining named plaintiff, Euclid Labs, for lack of subject matter jurisdiction, because the plaintiff agreed to Euclid Labs’ terms of service, which contained a class-action waiver, which the Court could consider on a motion to dismiss. Because the plaintiff had waived his right to bring class claims, his basis for subject matter jurisdiction under the Class Action Fairness Act was eliminated.

The Court dismissed the remaining named plaintiff’s claims against the individual officer for lack of personal jurisdiction in New York. The Court adopted Morrison Cohen’s arguments that the officer’s appearance at promotional events in New York months or years before the $ME token was released did not have a sufficiently close connection with the alleged misconduct, and the officer did not make any misrepresentations involving $ME; instead, he made statements that were literally true, which “cannot, by definition, be a misrepresentation or a deceptive practice.”

The Morrison Cohen team was led by Jason Gottlieb, Michael Mix and Rachel Fleder Rothman.