Mark Karpeles seeks judgment in his favor in lawsuit brought by former MtGox customer

Source: FinanceFeeds 2020-01-08

According to Karpeles, no evidence has been produced that he was negligent.

Mark Karpeles is pushing for a summary judgment in his favor in a lawsuit launched by ex-MtGox customer Gregory Greene. This becomes clear from a set of documents submitted at the Illinois Northern District Court on January 7, 2020.

Gregory Greene filed his original Complaint against Karpeles on February 27, 2014. The plaintiff filed three subsequent amended complaints on March 17, 2014, April 17, 2015 and April 4, 2016. He filed his Fourth Amended Complaint on March 7, 2017, which remains the operative complaint. In the Fourth Amended Complaint, Greene asserts the following three claims against Karpeles:

Count I for conversion/trespass to chattels;
Count II for negligence in the alternative to conversion/trespass to chattels;
Count III for a violation of the Illinois Consumer Fraud and Deceptive Business Practices Act (ICFA).

Gregory Greene seeks to hold Karpeles accountable for conduct that led to the loss of more than $400 million from US users of the MtGox bitcoin exchange on theories of negligence, conversion, and fraud. The plaintiff alleges that, as the CEO of MtGox, Karpeles controlled all aspects of the exchange: he was responsible for the code underlying the exchange, knew of bugs and other security issues affecting the exchange, and controlled what information was disclosed to Mt. Gox’s customers.

In the documents filed with the Court on January 7, 2020, Karpeles insists that he is entitled to summary judgment because, according to the defendant, Greene has produced no evidence to support conversion (Count I). Further, Karpeles argues that Greene has produced no evidence that Karpeles was negligent and cannot recover solely economic loss under an Illinois negligence claim (Count II).

Finally, according to Karpeles, Greene has contradicted his own allegations and cannot establish about misrepresentations that amount to any purported consumer fraud, cannot prove that Karpeles owed him any duty that could sustain any claim based on a concealment of a fact, cannot establish that there was a concealment of any material fact, and/or cannot prove the requisite proximate cause under the ICFA (Count III).

In the meantime, there was no update provided as to the progress of discovery. The Illinois Northern District Court has instructed Karpeles to produce certain documents about the operations of the ill-famed Bitcoin exchange but he has refused on the grounds that he needs the permission of the Japanese prosecutor. In response, the Illinois Court has addressed the Japanese public prosecutor and asked for co-operation on the matter.

In December 2019, the parties in the case filed a status report, which shows little has changed with regard to discovery. Counsel for Karpeles has been informed that the order has been provided the Japanese public prosecutor, but has no information that the Japanese public prosecutor has issued any kind of response regarding the Illinois Court’s order.

As a result, Karpeles has not produced any documents implicated by the Illinois Court’s order.

Mark Karpeles seeks judgment in his favor in lawsuit brought by former MtGox customer

Subscribe to Our Newsletter!

Subscribe to Our Newsletter!