Cress v. Nexo Capital Inc.

Background

John Cress sued several Nexo-related defendants, alleging that they fraudulently induced him to take out loans secured by digital assets that were later sold. Nexo Capital, Inc. was the only remaining defendant when the court considered this motion.

Cress previously filed an original complaint and a First Amended Complaint. Earlier orders dismissed some claims and defendants but allowed certain claims against Nexo Capital, Inc. to continue. The case-management order set December 12, 2024, as the deadline to seek leave to amend pleadings. The court later extended the fact-discovery deadline to February 27, 2026.

During discovery in March, August, and September 2025, Nexo produced documents that Cress said revealed undisclosed fees and markups connected to over-the-counter transactions and liquidation of assets. Some documents described fees and profits, and others referred to concealing or not disclosing liquidation fees. Cress also relied on documents concerning Nexo’s statements about whether the NEXO Token was registered with the Securities and Exchange Commission.

Requested Amendment

Cress moved under Federal Rules of Civil Procedure 15(a) and 16 to file a Second Amended Complaint. He sought to add additional misrepresentations to his fraudulent-inducement claim and to add claims for fraudulent omission, common-law fraud, civil theft, civil Racketeer Influenced and Corrupt Organizations Act (RICO) violations, and breach of contract.

Nexo opposed the motion. It argued that Cress had not shown the required good cause for amending the scheduling order, had delayed seeking amendment, had acted in bad faith, would prejudice Nexo, and proposed claims that were legally insufficient.

Court’s Analysis

Because Cress sought amendment after the scheduling-order deadline, the court first applied Rule 16’s good-cause standard. The court found that Cress acted diligently. It concluded that he did not have the information needed to plead the proposed claims until at least August 2025 and that he filed the motion within one month after receiving the relevant documents. The court therefore found good cause to modify the scheduling order.

The court then applied Rule 15, which generally favors allowing amendments when justice requires. It found that the proposed amendment was not sought in bad faith or with undue delay. The court also found that Nexo had not shown substantial prejudice. Although the amendment could require additional discovery and introduce new legal theories, the court said those consequences alone did not establish substantial prejudice.

The court rejected Nexo’s futility argument at this stage. It explained that the merits of the proposed claims generally should be tested through a later motion to dismiss or a motion for summary judgment, rather than decided on a motion for leave to amend. Nexo had not shown that no set of facts could support a valid claim. The court also found that Cress’s earlier amendment did not weigh against allowing another amendment.

Disposition

The court GRANTS Cress’s motion to amend. Cress must file the Second Amended Complaint as a separate docket entry by November 10, 2025. Nexo must file its responsive pleading under Federal Rule of Civil Procedure 15(a)(3). The order does not decide whether Cress’s proposed claims will ultimately succeed.