| April 28
April 28 U.S. and Canadian customers of failed
Tokyo-based bitcoin exchange Mt. Gox have agreed to settle their
proposed class action lawsuits that alleged the company
defrauded them of hundreds of millions of dollars.
The class action plaintiffs agreed to support a plan by
Sunlot Holdings to buy the shuttered exchange and accept their
share of bitcoins still held by Mt. Gox, according to a
statement and court filings.
Mt. Gox filed for bankruptcy in Japan and the United States
earlier this year after saying it lost some 850,000 bitcoins -
worth more than $400 million - in a hacking attack. It
subsequently said it found 200,000 bitcoins.
Once the world's biggest bitcoin exchange, Mt. Gox is slated
to be liquidated after the Tokyo District Court granted the
company's request to abandon plans to revive its business.
In return for settling separate class actions, the U.S. and
Canadian customers will share in a 16.5 percent stake after Mt.
Gox is sold to Sunlot, a firm backed by child actor-turned
entrepreneur Brock Pierce and venture capitalist William
Sunlot has proposed buying Mt. Gox for one bitcoin, or less
than $500, according to the Wall Street Journal. A sale to
Sunlot must be approved by the Tokyo court.
In addition, the customers will split the 200,000 bitcoins
that Mt. Gox said it found after seeking bankruptcy protection,
and they will split up to $20 million in fiat currency held by
the administrator for Mt. Gox.
"This is the customers' best option and the only chance they
have for full restitution," said a statement from Jay Edelson of
the Edelson law firm, the lead attorney in the U.S. case.
The settlement releases Mt. Gox's founder, Jed McCaleb, and
Gonzague Gay-Bouchery, once the exchange's chief marketing
officer. The pair committed to help pursue the class action
against the remaining defendants: Mt. Gox CEO Mark Karpeles,
parent company Tibanne, the company's banking partner Mizuho
Bank Ltd and others.
The settlement needs to be approved by the Canadian and U.S.
courts overseeing the class actions cases.
The U.S. class action is Gregory Greene et al v Mt. Gox Inc
et al; United States District Court, Northern District of
Illinois, No. 14-01437
The Canadian class action is David Joyce et al v Mt. Gox Inc
et al, Ontario Superior Court of Justice, CV-14-500253-00CP
(Reporting by Tom Hals in Wilmington, Delaware; Editing by Ian