“Courts cannot consider claims that are no longer extant, and thus seeks reconsideration of the portion of the order finding that each of the Partner Defendants are liable under a direct theory,” stated Gauntlet in its motion for reconsideration on Monday.
In August, the investors responded to the defendants’ motion to dismiss, stating that they “do not presently allege that the partner defendants are directly liable” under Section 12 of the Securities Act. Instead, the investors argue that the firms are liable because the Compound DAO is liable under Section 12. As the DAO is a general partnership without limited liability protections, the partner defendants are responsible for its liabilities, according to the investors.
The venture capital firms, collectively referred to as the partner defendants, argued in their motions for reconsideration that the court’s decision to not dismiss the lawsuit was based on the incorrect assumption that the abandoned claims had been revived. Even taking into account the abandoned theory of liability, the partner defendants are not liable, they contend.
