They're legal situation is that they have not paid what they owed, and have done absolutely nothing to pay back what they owe.
That's not quite correct - they may have lost BTC and LTC but they have other coins and should have returned them. For example here is their doge cold wallet address:
https://bitinfocharts.com/dogecoin/address/DDTtqnuZ5kfRT5qh2c7sNtqrJmV3iXYdGGThere are coins there, which means they can return doge to customers if they choose - am not sure why this didn't happen.
this is where things get complicated, and why, again, you are fucked because you gave your coins to someone else who is an asshole.
if they really lost those bitcoins and are going to declare bankruptcy, they can't just give you back your doge.
using round numbers for example, if they owe people 1 million dollars, but only have 500k of assets, everyone needs to share the burden equally (unless there are some creditors who have priority for some reason.) You don't get all of your doge back just because they didn't lose your doge while someone who has 1 btc there gets nothing because they lost BTC, that's not how it works. Especially now that they've admitted that they are insolvent. Everyone has to share the fucking equally, not just the people who lost certain coins. Giving you are your doge back while they are insolvent moves them into a new version of law breaking.
As far as I know they opened a few wallets so they have already crossed that bridge and are a new version of a$$holes