Bitcoin-focused investment firm Strategy (formerly MicroStrategy) is facing at least five separate class-action lawsuits over $6 billion in unrealized Bitcoin losses, alleging the company made misleading statements to investors about the risks and profitability of Bitcoin.
The initial lawsuit was filed by Pomerantz LLP on May 16. However, four other law firms — Gross Law Firm, Bronstein Gewirtz & Grossman, Kessler Topaz Meltzer & Check and Levi & Korsinsky — have opted to file separate lawsuits with similar content rather than join the lawsuit.
That’s not unusual, legal experts say. “In class-action securities litigation, law firms compete for the lead counsel role because that role can be very lucrative, with fees in the tens of millions of dollars,” said Adam Pritchard, a professor at the University of Michigan Law School.
Each of the lawsuits alleges that the company made “materially false and misleading” statements about the profitability and risks of Bitcoin investments between April 30, 2024 and April 4, 2025.
Professor Ann Lipton of the University of Colorado School of Law similarly emphasized the importance of the lead plaintiff position, saying, “The lead plaintiff controls the litigation and determines the class attorneys. In cases that appear to be strong, many firms and plaintiffs file lawsuits to try their luck.”
Law firms looking to get ahead in the litigation process are issuing public press releases inviting more investors to join the case. These statements often draw attention to the July 15 deadline, when the court will choose a lead plaintiff and the other cases will be consolidated under that umbrella.
The primary goal of law firms, Pritchard says, is to include the most harmed investor among their plaintiffs. The Securities Private Litigation Reform Act of 1995 requires that the lead plaintiff role be given to the investor who suffered the most harm and volunteered to take on that role.
Lipton sums it up this way: “An investor who has had more losses will monitor the case and the lawyers more carefully. That’s why institutional investors are generally preferred.”
*This is not investment advice.
