A New York federal judge turned down a joint request from the Commodity Futures Trading Commission and Gemini (GEMI) aiming to overturn a January 2025 consent order that levied a five million dollar civil fine and a permanent injunction against the digital asset platform.
On Thursday, Judge Alvin Hellerstein belonging to the Southern District of New York turned down the collaborative petition, noting that the rationale provided by both sides fails to justify reversing the verdict.
The agreement had settled a 2022 CFTC legal complaint claiming that Gemini supplied false or deceptive material declarations to regulatory representatives while they assessed a proposed bitcoin (BTC) futures product.
The signed order, finalized three weeks prior to the commencement of trial, mandated Gemini to hand over a five million dollar financial penalty, an amount the exchange has already fulfilled. Additionally, it permanently barred Gemini from offering inaccurate, misleading statements or omissions to the CFTC.
Back on May 28, 2026, the pair submitted a combined motion to dissolve the order. The agency explained it ought not to have launched the complaint and would refrain from doing so given its updated enforcement guidelines. Meanwhile, Gemini contended that it opted to settle due to heavy regulatory intimidation.
Arguments insufficient
Judge Hellerstein stated that these points were inadequate, explaining that the details connected to the initial litigation were not events occurring after the judgment but instead pertained to data accessible prior to the resolution.
"Newly acquired knowledge of facts that existed at the time the Consent Order was entered does not constitute a significant change in factual circumstances," the court said. "The CFTC’s present assessment that this action should not have been brought does not require vacatur or other relief."
The magistrate also emphasized that Gemini’s assertion of yielding to regulatory coercion fails to prove that its agreement lacked consent, highlighting that the exchange contested the matter for roughly three years and understood the internal matters at hand, which featured a fraud operation involving its past chief operating officer. The court concluded that the company ultimately "made the calculated decision to settle the case shortly before trial."
The Block has reached out to Gemini and the CFTC for comment.
Originally published at https://www.theblock.co/news/regulation/2026-10-16-us-judge-denies-joint-gemini-cftc-bid-418775.
