Topic: CoinLab suing MtGox for $75 milliion? (Read 19414 times)

The contract is public. It's part of the filed complaint.

As best I can tell, the details of the contract are not public.  So, unless you claim to be privy to information that others are not, it's kind of hard to take your argument very seriously.

Seems to me that things started to go sideways when customers realized that their accounts (information and possibly funds) were being sold off without their authorization and pitched a bitch about it.

I've lost trivial amounts of funds in two instances when 'investors' bought accounts.  One was Bitcoinica, and the other was Instawallet (though I do not know if Instawallet was sold or gifted.)  In fact, it seems that CoinLabs has involvement with some of the same parties that purchased Bitcoinica and seemingly nose-dived it into the ground (where 2 or 3 BTC which used to belong to me got lost...and I suspect 'found' as well.)

To my knowledge the only time the equation has gone the other way was when that Polish exchange 'lost' their funds in a (purported) EC2 accident.  When Krapeles bought it the customers got their coins restored as I recall.

  Edit:  I pro-actively correct my statement about the details of the contract.  The details of the supposed failure in compliance remain murky I would say.

Would it not be possible to sit down for an hour or two at the (then) upcoming bitcoin conference and talk about the situation instead of suing right off the bat ? I know if someone sued me, I would stall and evade as much as possible just to make life hell for them, especially so if they did it with evil intentions. And how can they possibly work together after this ? Essentially it's burning a bridge.

You have three cases on your table - one's with a subcontractor, one's with the guys that sued your ass, and one's for the IRS, which case will come at the bottom of the que ?

If someone signs a contract to do something and then doesn't, you don't just suck their dick.  You sue their ass.  Unless you are a total sucker who likes being made a fool.

OTOH American laws are not set up to destroy Japanese exchanges.

both guys are members of Bitcoin Foundation, both guys wanted to cooperate. But my opinion is Coinlab's Mr. V is a Bastard. He chose war instead of peace.

ffs, could you guys please get back ot?

your confused yes, you wrote
"There is nothing saying Mt Gox didn't know about this as you claim. Just because it happened doesn't mean they didn't have lawyers in a courtroom in Maryland arguing against it."




your argument devolves into ad hominem, re -read what you though separation of powers was as against what it is.





[/quote]
due process is an additional and separate requirement imposed by 5, the in read AND  nor shall private property be taken for public use, without just compensation, is another separate condition.

Do you see the ";" followed by nor

sure the govt can take private property, but not without just compensation.

anyhow in addition to taking some formal legal education, I recommend basic reading/comprehension, and attetnion to detial.

also the executive Gov does not throw anyone in "jail" they have no authority to. At most they can hold a person on remand, but must take that person before a judge / magistrate or judicial officer within a very short time frame, and then the Judge decides on bail/jail/imprisonment to trial. Again you appear to have no grasp of how the judicial, executive and legislative arms or government work, or a person rights in respect of them.

You probably don't even know what the term executive Govt means.


as I said before, please continue your have leveled up (down) to shooting fish in a barrel stage.

I'm confused - are you trying to be an obvious troll now? If you're going to make up something I didn't say don't claim it is in the part you just quoted when it clearly does not say "mtgox had lawyers in court" anywhere in the quote.




Alright my confusion is clearing up - so you ARE just being a troll, right? I *really* hope you aren't a lawyer. Separation of powers doesn't have any bearing here.





:lol: :lol: - well I guess the DHS will be pissed when gox's lawyers show up in court and say "hey guys this law is unconstitutional kthxbai".

See the part where it says "nor shall any person ... be deprived of ... life, liberty, or property, without due process of law"? Do you know what that means? I guess the government can't throw people in jail either, right? Wrong. That's exactly what the "due process of law" part means. This order follows the due process of law - legislative branch made the law, executive sent out the DHS agents to ensure compliance and now the judicial branch is hearing it. There's your "separation of powers" lol. In any event the US can certainly make a law that says that if you break a law the property used in that lawbreaking is forfeit to the US Government and that's what happened here.

The part about "just compensation" is a restriction on the government's power to exercise eminent domain which is a direct "taking" and different from the case at hand.

Anyways if you seriously think the US government has NO power to seize funds (and can only "buy" them for fair market price) you'll be in for a rude awakening if it ever happens to you.

You really don't understand separation of powers,





you said


It was crystal clear that Gox had no idea what was going on at the time you made this statement, Its called basic research, I did it, you just went oh GOX had lawyers there.




Thats got nothing to do with separation of powers. Ok at this point, you probally need to get a formal legal education, or refresher if you have had one. Separation of powers has nothing to do with the executive having more ways to bring an action vs a private person. It is to do with the judicial arm being separate to the the executive and parliament.





The govt has to stand in line for property like anyone else or compensate: check your Constitution

for example

the 5th

No person shall be held to answer for a capital, or otherwise infamous crime, unless on a presentment or indictment of a Grand Jury, except in cases arising in the land or naval forces, or in the Militia, when in actual service in time of War or public danger; nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb; nor shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.[1]


see those last words without just compensation.[1]

My money held that is owed to anyone else eg your money held in say GOX's account and that bank and that account is seized by gov, for your part you are entitled to just compensation from the GOV for them taking your property.

It isn't "relatively easy" for a number of reasons as I stated. Again, this is the US Government here NOT a private individual so it really has no bearing on what we were actually talking about - lawsuits like coinlab's.


Huh? When word about the DHS thing first came out there wasn't much information. It wasn't clear whether this "court order" was obtained ex-parte or not. That's all I was saying. I never argued that gox did have lawyers in court before the order was made and if I had to guess I'd say they weren't.


Uhh, no they aren't. You actually link to the court order in a later post yet you obviously haven't even read it. If you had, you'd see the law under which the court order was made. 18 U.S.C. section 981 gives the government - yes the government only, not private citizens - the power to seize property that is involved in a transaction violating 18 U.S.C. sections 1956, 1957 or 1960. This was the case here and so the order was made. Coinlab can not do this in their lawsuit.    



As I said above, coinlab could not do this in their lawsuit. Nor is there any question of "priority". If you read the law cited in the decision you will learn that those funds in question become property of the United States which is why the government can seize them. They do not become "recovered funds" that all creditors are allowed some share of. Even if coinlab won a lawsuit today they have no claim to any money in the dwolla accounts as they already belong to the US Government.

Everything that transacts in US$ can be defined as "money pipe".

The rules of the game are very simple. It doesn't matter in which country is your business incorporated. If your business is dealing in US$ you have to pay a special tax to the US Government. This tax depends on what other favors you'll do for them.

Agree - although I imagine they'll begrudgingly settle for Mutum Sigillum to pay the $50k fee to become a registered MSB... They usually win the old extortion game. Of course Gox will have to pay a fine/late fee as well...

So, who is this confidential informant from Maryland?  Way to go, douchebag!

What a terrible 28th birthday present coming on June 1: http://web.archive.org/web/20090323014632/http://bbs.solirc.com/index.php?showuser=1

found via http://web.archive.org/web/*/http://mutumsigillum.com

Yes it has been frozen and even more seized

http://cdn.arstechnica.net/wp-content/uploads/2013/05/Mt-Gox-Dwolla-Warrant-5-14-13.pdf

When you said freezing accounts across borders was just a matter of pushing a button in Europe, I thought that implied that any arbitrary power could do it whenever it suits their needs. And I argue that it is not the case. Whether in the US or in Europe (any "serious" democracy), prosecutors will need to provide a lawful rationale before they can freeze any account. And joesmoe2012's link shows that it was the case here.

So basically I meant that it was not worse or better between Europe or the US, pretty much the same process.

That is very interesting read, thanks for the link.

So basically, the Dwolla account was seized because of a violation of 18 USC § 1960. Another very interesting quote :


My personal analysis is that the United States government (DHS in that case) is now considering Bitcoin as a currency, and is not buying the attempted separation of roles between "MtGox" (as a Japanese corporation) and "Mutum Sigillum LLC" that seems to exist only as a kind of money pipe between MtGox (Japan) and Dwolla. In short: they have frozen the account in an attempt to enforce more regulation and force MtGox to operate within the US under FinCEN regulation.

It's not THAT bad. It's is just very political, and very unfortunate that MtGox US customers that had pending/ongoing Dwolla transfers are suffering from it. It should be settled between Gox and the US gov't, eventually.

Mtgox is definitely directly involved, haven't you guys read the court order?

http://cdn.arstechnica.net/wp-content/uploads/2013/05/Mt-Gox-Dwolla-Warrant-5-14-13.pdf

From what I've read other places, Mark Karpeles was the one making the bank account dealing with Dwolla, so MtGox seems to be very much directly involved.

I wasnt referring to that case specifically, but since you mention it:
They closed the account in Germany for suspicion of fraud instantly. Poland followed suit without inspection as soon as the request from Germany arrived too.
Now if accounts can be closed that easily in separate countries, with their own bylaws and jurisdictions, for suspected fraud, imagine what the freakin DHS can do on whatever charges they dream up.

Edit: Im having difficulties understanding your edit, are you saying its not so hard afterall?