Digital asset custodian BitGo said it planned to seek more than $100 million in damages from Galaxy Digital, alleging the investment firm owed the funds as part of a “reverse break fee” in its decision to terminate an acquisition agreement.

In a Monday blog post, BitGo referred to Galaxy’s actions as “improper” in claiming a breach of contract to drop an agreement to acquire the digital asset custodian. BitGo has enlisted the services of law firm Quinn Emanuel to pursue legal action against Galaxy for not paying a “$100 million reverse break fee it had promised back in March 2022.”

According to Galaxy, BitGo failed to provide audited financial statements for 2021 by July 31, 2022 as part of the acquisition agreement, a claim Quinn Emanuel partner R. Brian Timmons denied:

“The attempt by Mike Novogratz and Galaxy Digital to blame the termination on BitGo is absurd [...] Either Galaxy owes BitGo a $100 million termination fee as promised or it has been acting in bad faith and faces damages of that much or more.”

Galaxy announced its intention to acquire BitGo in May 2021 as part of plans to go public in the United States. Following a delay at the end of the first quarter of 2022 during which Galaxy CEO Mike Novogratz said the firm had “adjusted the deal some,” the acquisition was expected to go through between Q2 and Q4 2022.

“We believe BitGo’s claims are without merit and we will defend ourselves vigorously,” a spokesperson for Galaxy told Cointelegraph. “BitGo did not provide certain BitGo financial statements needed by Galaxy for its SEC filing. Galaxy’s Board of Directors then made the decision to exercise its contractual right to terminate.”

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It’s unclear if the recent market downturn was a factor in the deal potentially falling through. Galaxy originally said it planned to pay roughly $1.2 billion in stock and cash in 2021. BitGo said on Monday it had more than $64 billion in assets in custody at the end of 2021 and “client growth continues into 2022.”