Ex-MtGox clients want Court to authorize alternative service on Mark Karpeles

Maria Nikolova

Attempts by the Japanese government to serve Karpeles under the Hague Convention have been unsuccessful.

There are several lawsuits in the United States targeting Mark Karpeles, the former head of ill-fated Bitcoin exchange MtGox. The proceedings have been hampered to a great degree due to formalities, like effecting service on Karpeles.

One of these cases has been brought by Joseph Lack, a resident of California, who joined Mt. Gox in January 2014. Upon joining, he wired $40,000 to Mt.Gox’s Mizuho account. Mizuho accepted the transfer and collected the transaction fee. On February 24, 2014, the website of the exchange went unresponsive. Lack waited in vain for his deposit to appear in his Mt Gox account and he did not succeed in getting his money back.

Accordingly, Lack brought an action against Karpeles and Mizuho. Lack alleges that Mizuho had a duty to disclose material information to him and the other depositors. Also, the plaintiff accuses Mizuho of intentionally defrauding him by concealing that the bank was no longer accepting withdrawal requests. Furthermore, the plaintiff alleges that Mizuho caused him damage.

In a filing submitted at the Court earlier this week, Mr Lack updates on the latest developments concerning his efforts to effect service on the former head of MtGox.

Mr Lack has been attempting to serve Mark Karpeles, who is a French citizen living in Japan, for months. After securing a recent mailing address for Mr. Karpeles via a Court-authorized subpoena, Mr Lack sent translated versions of case documents to the Japanese government which, in turn, attempted to serve Karpeles at his home address under the procedures set out by the Hague Convention. But on January 29, 2019, Mr Lack received information from the Japanese government that these attempts at service were not successful.

While disappointing, this outcome is not seen as unsurprising given that Karpeles also managed to avoid formal Hague Convention service in a similar case launched against him in the US. Mr Lack now asks that the Court authorize alternative service including by email and through Karpeles’s US-based attorneys.

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