Tulip Trading: Important Court of Appeal ruling in landmark crypto case

This morning the Court of Appeal in London (Lewison, Popplewell & Birss LJJ) gave judgment in the claim by Tulip Trading Ltd against sixteen developers alleged to be responsible for the operation of the Bitcoin network. The claim alleges that each of the developers owes to Tulip fiduciary duties and duties of care, effectively to police the Bitcoin network. The Court of Appeal has ruled that those claims give rise to a “serious issue to be tried” and should therefore proceed to a full trial in London. The Developers had previously succeeded in dismissing the claims summarily in March 2022 on the basis that they did not give rise to a serious issue to be tried.

Astraea Group act for fourteen of the developers instructed by Bird & Bird, whose team was led by partner Sophie Eyre and supported by senior associate Priyan Meewella. James Ramsden KC was lead and sole advocate for them in the Court of Appeal.

Commenting on the judgment earlier this morning James Ramsden KC said:

“This is in many ways an outcome the Court of Appeal may have felt driven to. Because the developers are all outside the jurisdiction of the court permission to serve the proceedings on them was required. And that required Tulip to show that its claim gave rise to a serious issue to be tried. As observed by the Court of Appeal in granting permission to appeal last August, it is in many ways a shame that this incredibly important case fell to be decided according to this low threshold test rather than at a full trial. The Court of Appeal has effectively agreed with that observation by deciding that the issues raised by this case are so important they merit determination at a full trial. Tulip’s claim has been bedevilled by pleading and presentational issues but once again the Court of Appeal have looked through them in favour of a ruling at a full trial that will deliver greater legal certainty.

The courts in this jurisdiction continue to lead the common law world in developing a legal structure for the De-Fi sector. This case will be the most important so far in maintaining that lead and continuing to establish this jurisdiction as the leader for De-Fi litigation.

The outcome of this claim at trial will therefore have a profound impact and not just in the UK. That impact will apply regardless of whatever regulation the UK Government eventually settles on. So watch this space. I expect a full trial in early 2024.”

Here is a hyperlink to the judgment.

The information provided in this article is of a general nature and does not constitute, nor should be relied on, as legal or professional advice.