Mark Karpeles insists he cannot be sued in Illinois
The former head of notorious MtGox exchange says the case brought against him at the Illinois Northern District Court has to be dismissed for lack of personal jurisdiction.
In tune with the deadlines set by the Illinois Northern District Court, Mark Karpeles, the former head of ill-fated Bitcoin exchange MtGox, has responded to claims against him brought by former clients of the Exchange.
On Friday, August 24, 2018, Mr Karpeles filed a Motion to dismiss the case with the Court. In the document, he contests that the Illinois Northern District Court has personal jurisdiction over him in these proceedings.
The defendant notes that he is a citizen of France living in Japan, and that he does not have the necessary “minimum contacts” with this forum. Mr Karpeles also says that he has not “purposefully directed his activities at the forum state or purposefully availed himself of the privilege of conducting business in that state” nor does the “alleged injury arise out of the defendant’s forum-related activities.”
Although the plaintiffs assert the legal conclusion that “through Tibanne KK and the Mt. Gox Exchange, Karpeles conducted business throughout this District, the State of Illinois, and the United States.”, they do not allege any personal activities of Karpeles, such as conducting his own business, in any of this District, the State of Illinois and the United States, or any specific activities of Karpeles, the defendant argues.
The action was brought by Gregory Greene and Anthony Motto who have sought to hold Mizuho Bank, Ltd. and Mark Karpeles liable for financial losses stemming from the collapse of Mt. Gox. According to the plaintiff, the investors who wired money into Mt. Gox’s account at Mizuho Bank after June 21, 2013, walked into a trap: their money could go into Mt. Gox’s account at Mizuho, but it could never leave.
Bitcoin investors were informed on June 21, 2013, of a “temporary hiatus” in the USD withdrawals from Mt. Gox and then told on July 4th that withdrawals had resumed.
Mt. Gox’s customers kept trading on the Exchange and relied on Mt. Gox’s promise that it would hold funds on behalf of its customers. When thousands of individuals submitted requests to withdraw their fiat currencies from Mt. Gox’s account at Mizuho, Mt. Gox was able to offer a only a handful of investors relief, though only after extended delay and payment of an increased fee. The majority of them, however, were left high and dry.
On February 7, 2014, Mt. Gox announced a “temporary suspension”. Two and half weeks later, the Exchange website went dark .