DENVER (LN) — A federal magistrate judge handed plaintiffs in the consolidated Synapse Financial Technologies collapse litigation an eight-month discovery extension last week, pushing the class certification deadline to March 2027 and rejecting one defendant bank's argument that the delay amounted to more than a year of plaintiff inaction.
The ruling matters because the stakes are enormous and the finish line keeps receding. Hundreds of thousands of consumers allegedly lost access to their funds when Synapse — a fintech intermediary that routed deposits into pooled For Benefit Of accounts at partner banks — collapsed, and the litigation now spans six consolidated cases against Evolve Bank & Trust, AMG National Trust Bank, and Lineage Bank. Neither the court-appointed Synapse bankruptcy trustee nor any of the defendant banks has completed a full reconciliation of the relevant transactions. The plaintiffs' lawyers say the produced data alone tops ten terabytes.
The case, Margul v. Evolve Bank & Trust, No. 1:24-cv-03259, was filed in the District of Colorado and consolidated with five related actions. Fourteen named plaintiffs, suing individually and on behalf of all similarly situated persons, allege the Synapse collapse left them and hundreds of thousands of others unable to access their funds, creating what their counsel described as a complex, multi-party dispute over the location and disposition of those funds across multiple banks, fintech platforms, and FBO accounts — spanning multiple years and a bankruptcy proceeding.
Magistrate Judge N. Reid Neureiter granted the extension on April 16, walking through the six-factor test courts in the Tenth Circuit apply when a party seeks to amend a scheduling order. The original schedule had contemplated roughly one year of discovery, closing May 15, 2026. Under the new order, fact and class discovery closes January 15, 2027, with the class certification motion due March 17, 2027, and expert discovery running through August 18, 2027.
A significant factor in the analysis, Neureiter wrote, was a July mediation the parties are anticipating. In a case of this magnitude — with thousands of potential class members, reams of data to be analyzed, numerous depositions to be taken, and expensive expert reports to be prepared — focusing efforts on mediation rather than on depositions and expert reports makes some sense, the magistrate judge concluded. He declined, however, to add a formal mediation deadline to the schedule, writing that the court is not in the business of ordering parties to mediation.
AMG National Trust was the lone holdout. The Colorado bank argued that the complexity of the Synapse transactions was apparent from the very beginning and had been disclosed in bankruptcy hearings that began in May 2024. In its opposition, AMG characterized plaintiffs' suggestion that they lacked the records they needed as nothing more than an excuse for more than a year of inaction. AMG also warned that extending the potential class period would negatively impact its financial disclosures, employee morale, and acquisition, client, prospective client, and regulatory discussions. Neureiter was unpersuaded, concluding that AMG's claim of prejudice on that point appeared more speculative and conjectural than tangible.
AMG's opposition is also shaped by its litigation posture: the bank has already moved for summary judgment, arguing it distributed all or nearly all end-user funds according to Synapse Brokerage's instructions and owes no duty to plaintiffs because its contractual relationship ran to Synapse, not to consumers. Plaintiffs have filed a Rule 56(d) declaration arguing they need more discovery to test the reliability of AMG's data and the accuracy of its distribution methodology — a dispute that remains before Chief Judge Daniel D. Domenico.
Neureiter closed the order with a warning: no further extensions will be granted absent extreme circumstances.
Whether AMG's summary judgment motion survives that discovery fight — and whether a July mediation can resolve a case that neither the bankruptcy trustee nor the banks themselves have yet been able to fully reconcile — will determine whether the March 2027 class certification deadline holds any practical meaning.