Topic: Time to sue ButterflyLabs - Big Single-SC owner let's league for class action (Read 39303 times)

I joined because I requested a refund and was formally denied.

I'm getting paid.

http://www.woodlaw.com/sites/default/files/casedocs/2014-04-04%20Complaint.pdf <-- read this cover to cover and in particular from point 54 onwards.


Then I suggest asking those questions in legal https://bitcointalk.org/index.php?board=74.0 where you might get a much better answer than you could here.

Anyone care to elaborate on the impact of class-action VS regular lawsuit ?
Usually i heard of class-action against big corporations.
What is this going to achieve ? What's the target ?

They are gathering info right now on that aspect. Check out the link and get in contact with them.

I'm thinking about joining however I'm not sure I can be of help since my order was a pre-order.

I have applied to be part of the class action.

http://www.woodlaw.com/cases/butterfly-labs-and-bf-labs-inc-bitcoin-miners

Ya some people did. Join them.

did anyone in this thread actually attempt to sue or just wrote angry responses/emails?
lol

Because they're kind of lurking in an ambiguous area where their failure to deliver can be seen as just a breach of contract rather than fraud, so the criminal authorities aren't doing anything about it.  Also, as a breach of contract, you aren't likely to get attorney fees, so no lawyers are really swarming to get involved.  And the legal fees for pursuing it are (except for a few of the bigger fish) not likely worth what is usually going to be a small claim.

There's the class action issue, too, but it's tough to argue everyone subjected to BFL's delays has been harmed in the same way.

So this is the kind of questionable operation someone might commit who was inclined toward dishonesty but doesn't want to go back to prison.

Yup, That's their favorite, and yet nobody has stopped them yet? Could someone elaborate on why BFL is getting away with all of their horrible business practice's and cons?
"SHIPPING NEXT MONTH, PRE-ORDER NOW!, PRODUCTS ARE IN FINAL STAGE OF DEVELOPMENT!" x7
When did that "final stage" product get shipped? Uhh Never, They never managed to create what they said they would
When did The final stage product get shipped to an average customer? About nine months.
BFL Conned people into being investors with no return, those "pre-orders" for nearly finished devices were sold under false advertising
Nothing was in a final stage of development, they didn't even have proof of a profuct untill four months from first advertisements
The product they finally shipped missed all specifications by almost 300%, Including SIZE and heat generated, power usage, etc

THEY HAD NOTHING WHEN PEOPLE PAID FOR A PRE-ORDER of a "final development stage" bitcoin ASIC device

Mail fraud... tsk tsk BFL.

If you are doing this please let me know I have some additional issues that might include constitute US Postal Mail fraud on behalf of BF Labs.

Any update on how this is going?

Thank you,bcp19 WILL say otherwise.....he's got Josh's hand up his ass though 

BFL cannot ever deny a refund for product that has not shipped. However, BFL has systematically denied refunds (even during the time frame mentioned).  Most people who got refunds did so by badgering Paypal or their credit card companies.

BCP19 has too much ego to admit that he has been white knighting a company who ripped him off (along with several hundred other consumers).

All the plaintiff need do is demonstrate how much BTC a device in the first batch of Avalon mined to demonstrate potential earnings lost. BFL was to deliver in 3 batches, the first batch would have mined a mint had it been delivered on time (or anywhere near it).

First of many lawsuits that will bury BFL hopefully.

The defendant will prevail (not for their $5m in damages) but a full refund of their purchase price due to the fact that a refund cannot be denied. No way, no how. Even the document proves that "All sales are final" does not apply because a sale never took place.
In that regard its an open and shut case.

As for damages, there will be some.

Guaranteed.

Having read the complaint in speed read mode, one thing jumps out that may make it a dud.


So far, so good.  They set up that they made it clear from the outset that time was a critical consideration for them.

 [Emphasis added by me.]

The only way I can read this is the BFL representative explicitly disclaiming any guarantee of delivery date.

The complaint also cites a number of advertisements and other to the public communications of BFL which are, indeed, deceptive.  However, I would think a person-to-person communication with the company in the course of establishing an agreement would supersede anything said in advertisements, especially when even the advertisements essentially are stating aspirational goals, and not making explicit promises.

I'm not saying the whole suit is a dud, but they certainly led with a dud.

Also, a simple style complaint.  I don't like the use of "on information and belief" in factual allegations that should have been fairly easy to determine before filing suit.  Federal court does not require verified complaints (except in a few specific instances), but saying "on information and belief" is almost outright saying you doubt the fact yourself.  Yes, it's used a lot.  And this is just a personal opinion, I think it looks weaselly and should be avoided wherever possible.  Make sure your facts are correct to the best of your ability, and then if you can do that, say it loud and proud and without qualification.

It is rather tricky to prove something like expectation damages, that is, a form of damages caused as an incidence or consequence of one party's failure to carry out a contract.  Unlike explicit terms in a contract, though, these are damages resulting from what both parties could reasonably expect to be the result of a failure to carry out the contract.  Like all contractual damages, they are meant to put the party breached against in the position he would have been in had the contract been carried out.

In this case, this is likely to require expert testimony to prove.  The plaintiff would probably want to argue from historical data, because this is likely to give the best numbers.  BFL would, presumably, argue that you can't just assume that it would have been only the plaintiff who would have got mining equipment had they shipped on time, but that in fact, had they shipped on time, the difficulty rate would have spiked a lot sooner and the plaintiff would have made less.

While expectation damages are a well established principle of law, it is also a fact that courts often do not like awarding them, because they require a lot of speculation and argument.

It might even allow for a larger award to argue, simply, that had the contract never been entered and the plaintiff simply kept the Bitcoins, or purchased comparably expensive equipment from a less scummy operation that delivered closer to their stated ship-by date, they would have made X, but that they reasonably relied on BFL's promises.  That's a detrimental reliance claim.

IMO, BFL has a scummy, but interesting defense (at least to a detrimental reliance claim).  They could argue that even by the point in time the plaintiff purchased, BFL were such notorious liars that nobody could possibly *reasonably* rely on anything they said.  Cheeky but it might work.  (Usually, though, you aren't allowed to prevail with a legal argument based on your own misconduct.)

I've already been down this road and none of you like the answers I give you.  There was a chance at getting a refund back in May 2013, at that point they had initial chips in hand, were re-working the board design to accomodate the increased power and heat issues and were committing to the acquisition of the main component of these devices, the ASICs as well as commissioning the other items needed to produce thee units.  Personally, I think they should have just attached chips to boards like so many other 'companies' and let you all figure out how to power and cool them and be done with it.

Maybe they took the wrong route, maybe they should have offerred a refund like so many store do with a restocking fee for the items refunded.  They had already comitted funds to purchase items based on orders, basically just like if you goto a parts store and order a specialty item and then decide you don't want it, they charge you the restocking fee in order to offset the costs you just caused them to incur by purchasing and shipping this item in. 

When they offeres the chips for sale they did this... 50% non-refundable up front, 50% paid to receive shipment once the chips were in hand.

The problem to me is that you are referring to 'normal' companies and this is a niche market.  A lot of time and effort went into the creation of these devices targetted at a small fraction of the population and that means the normal rules do not always work well.  I had a custom 3" exhaust built for my Z28 after I had modified the motor to pull 400+HP and I paid a premium for it as it was a 'niche' market.  I had to pay up front and if I didn't like his design I couldn't exactly demand my money back in full as he had already committed a good portion of that to materials and in his effort.  It's not like he could say "no big deal, I'll just sell it sooner or later' when it might be a year or more before someone wanted a similar setup.

Like it or not, Mr Meissner is the woman who sued McDonalds because the coffee was hot and is probably not telling the whole story.  Personally I would have asked the woman 2 questions: Was this your first cup of coffee ever? and if no, "Do you make a habit of buying cold coffee?"

The problem here is that there are a lot of complexities and variables in the mix.  1) Can Mr Meissner show he has had a 100% up time with current equipment during the time he is claiming he lost money?  2) Can Mr Meissner show he has never spent a single BTC in that time frame as well, as he is asking for damages based on current prices and the total amount he 'could' have mined.  3) Can Mr Meissner prove he would have made the income he claims (ie did he ACTUALLY have that much online at that time, as anything else is speculation)?

I'd be willing to bet there is a lot to this that is not being told.  Let's take a look at his complaint:


From this it is obvious that he sent the money, but without any identifying information.  BFL was receiving hundreds if not thousands of orders in Mar/Apr due to the spike in the price of BTC.  Personally, if I sent that much money via a bank wire, I'd immediately follow it up with an email stating "I sent this from here" and provide whatever tracking information to speed up the process, not wait a week or more later and then ask why it hadn't shown up.

In addition, by his own statements, he placed his order on Mar 25th, but did not pay for his order for a few weeks.  So he 'ordered', the price went up and then he 'paid' at the old price after debating for "a few weeks" on the merits of his purchase?

Personally I find these statements to be lawerish double-speak:

Wow... 'Unilaterally decided' to substitute... rofl... Gee, doesn't EVERYONE have access to a 90 amp circuit in their house to power a single 1500GH unit?  Why refer to a 6-month plus delay then change to 8 months from order and 7 months from payment?  Also, why state the change to 6 500's and then revert to 2 1500's?  All through this document the lawyer switches from exact dates to statements that leave you hanging.  "A few weeks later"  "6 months plus"  "mined approximately 5,000 to 7,500 Bitcoins"

Then there's the Catch-22... since Inaba frequents these forums, everything I postulate becomes fodder for use by BFL all thanks to you questioning me.  How does it feel to be directly helping BFL?