Alex Mashinsky wants to dismiss two lawsuits, asks the court not to mention Celsius bankruptcy

Attorneys representing former Celsius CEO Alex Mashinsky have filed a motion in federal court to drop charges related to commodity fraud and market manipulation.

In a Jan. 12 filing in the U.S. District Court for the Southern District of New York, Mashinsky's legal team filed a motion to dismiss two felony charges the former Celicious CEO faces in September 2024. The second commodity scam is “disgusted” and based on the government's handling of crypto from the “first securities scam”.

“It is inconsistent and illogical to view the acquisition program as a commodity for the purposes of count one and the purposes of count two,” the filing said. “It is not clear if the government intends to argue that the Celsius income program is a security purchase and a commodity sale at the same time. […] The government cannot have it both ways and the appropriate remedy is to dismiss one of the charges.

Mashinsky's lawyers argued that the US government was “inventive” and that the court had dismissed six market manipulation cases for “lack of proper notice”.[ed]” for the crime of civil trespass. In addition to petitioning the judge to drop two of the seven criminal charges against the former CEO, the legal team also asked that information related to Celsius' bankruptcy be excluded from the case.

“References to Celsius' bankruptcy should be struck from the indictment. For the same reasons, the government should be barred from presenting evidence of Celsius' bankruptcy at trial.

Related: Former Celsius CEO Mashinsky wants FTC case dismissed

Celsius was one of several crypto companies that filed for bankruptcy in the United States during the market crash, including BlockFi and FTX. Mashinsky resigned as CEO in September 2022 and was indicted in July 2023 on seven felony charges, including securities fraud, wire fraud and conspiracy to defraud.

Mashinsky remains free on $40-million bail at the time of publication. Former FTX CEO Sam Bankman-Fried, another high-profile figure in the crypto space, is awaiting sentencing in November 2023 on seven felony charges. Former Binance CEO Changpeng Zhao pleaded guilty to one felony count in a plea deal with US authorities. He is barred from leaving the United States until his sentencing in February.

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