Bitcoin traders settle class actions over failed Mt. Gox exchange

Tue Apr 29, 2014 5:40am EDT

(Reuters) – 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.


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 Quigley.


“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.



Mt. Gox Class Action Lawsuit – Important Announcement (self.Bitcoin)

submitted by agggat

Good evening,

You’re receiving this e-mail because you’ve reached out to us regarding the putative class action lawsuit against Mt. Gox currently pending in the Northern District of Illinois (Greene v. Mt Gox, Inc. et al).

We’ve recently had an important development in the case that we’d like to share with you all. As you may soon hear from the press, we’ve filed papers tonight seeking approval of a settlement that has been reached with certain defendants. The filed documents have been uploaded onto the Mt. Gox litigation website that you’ve already been invited to.

A few highlights from the settlement:

  • The settlement is with Jed McCaleb, Gonzague Gay-Bouchery, and Sunlot (a US Investment group looking to purchase Mt. Gox out of bankruptcy).
  • The settlement amounts to a “Plan Support Agreement,” wherein the class has negotiated benefits to consumer creditors of Sunlot’s purchase. All parties to the settlement will support the Purchase Agreement when it is jointly presented to the Japanese Administrator.
  • Under the settlement, the consumer creditors will get (a) a pro rata return of bitcoins and fiat currency, (b) a combined 16.5% equity stake in the New Mt. Gox, (c) cooperation by McCaleb, Gay-Bouchery, and New Mt. Gox in the prosecution of our case against the remaining defendants, and (d) a commitment by New Mt. Gox to pursue strategies to recover the missing funds.
  • The settlement does NOT attempt to prioritize the US consumer creditors over anyone else, thus under the deal the 16.5% stake, for example, would be shared by all consumer creditors throughout the world. Non-consumer creditors who have claims are similarly not prejudiced.
  • The settlement is contingent on the Japanese Court accepting the purchase with the agreed-upon terms. If that does not happen, the settlement is void and the Parties are restored to the status quo ante.

We are very excited about this deal and believes it provides strong relief to the class. Going through the Japanese liquidation would have taken significant time and expense, and would likely have depleted existing assets and returned only pennies on the dollar. This deal will provide immediate funds to class members and give you all a stake in the new entity. Further, as the settlement does not release claims against many of the principal players, the class action lawsuit will still continue against the non-settling defendants (i.e. Tibanne, Karpeles, Mizuho Bank) and the class may well recover additional monies.


More info here: http://www.savegox.com/press/Gox_Creditor_Settlement_Press_Release.pdf