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A Halifax crypto-payment startup that sued a New York blockchain company last year, alleging it stole trade secrets, has reached a settlement to end the court action.

BlockCrushr Inc., which operates as Groundhog, was set to launch a product in August, 2019, that would enable consumers to make recurring payments using cryptocurrencies. But in documents filed in U.S. District Court in New York last year, Groundhog alleged that ConsenSys Inc. and affiliated companies – which hosted Groundhog staff in its accelerator in 2018 and promised a US$100,000 investment – launched an identical product called Daisy Payments the day before Groundhog’s own planned launch.

Groundhog had alleged that ConsenSys’s actions side-swiped the Halifax company, creating an “unfair advantage” gained by using Groundhog’s trade secrets, and sought damages for “willful and malicious conduct,” among other issues. ConsenSys was founded by Joseph Lubin, the Canadian co-founder of the Ethereum cryptocurrency.

However, after a review of the evidence provided during the discovery process, BlockCrushr conceded its claims were without merit and it dismissed the lawsuit with prejudice, ConsenSys said in a statement. The parties have now settled, with BlockCrushr paying ConsenSys a confidential sum, ConsenSys said.

A one-paragraph document filed with the court Tuesday said only that the parties had jointly stipulated to a dismissal of the action with prejudice, “including all claims and counterclaims,” with each party bearing their own legal fees and costs.

“This is an important and complete victory for ConsenSys and illustrates the value of aggressively combatting meritless claims,” Tibor Nagy, a lawyer representing ConsenSys, said in a statement.

Richard Cipolla, a lawyer with Roche Cyrulnik Freedman LLP who represented Groundhog, declined to comment.

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