New Class-Action Suit Filed Against Tezos Founders

NEWS
Nikhilesh De
Dec 18, 2017 at 03:00 UTC  |  Updated  Dec 18, 2017 at 03:01 UTC

Another class-action complaint has been filed in the wake of this year's $232 million Tezos initial coin offering (ICO).

In what constitutes the fourth effort to launch a class-action lawsuit against the controversial blockchain project, new court filings from Dec. 13 on behalf of plaintiff Bruce MacDonald notably call for a temporary restraining order on the assets raised during the token sale.

Among the defendants named are Tezos founders Arthur and Kathleen Breitman, Dynamic Ledger Solutions, Inc., the Tezos Foundation, Johann Gevers, Diego Ponz and Guido Schmitz-Krummacher (who reportedly resigned last week as one of the foundation's three board directors, according to Reuters). Cryptocurrency brokerage Bitcoin Suisse AG and its co-founder, Niklas Nikolajsen, were also named as defendants.

The filings allege that the Tezos token sale's organizers violated U.S. securities laws, echoing accusations contained in the class-action complaints previously filed. Previous lawsuits filed in relation to the Tezos ICO contained allegations of securities law violations and investor fraud.

Last week's filing stated:

"In sum, Defendants capitalized on the recent enthusiasm for blockchain technology and cryptocurrencies to raise funds through the ICO, illegally sold unqualified and unregistered securities, used a Swiss-based entity in an unsuccessful attempt to evade U.S. securities laws, and are now admittedly engaged in the conversion, selling, and possible dissipation of the proceeds that they collected from the Class through their unregistered offering."

The application for the temporary restraining order, submitted on Dec. 14, argues that the Tezos ICO holdings are worth in excess of $1 billion. It seeks to prevent the sale or transfer of the digital assets raised during the sale, alleging that "as cash, it can disappear quickly into the void."

The full class-action complaint can be found below:

Complaint by CoinDesk on Scribd


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