Mark Karpeles wants to stay lawsuit brought by US clients of MtGox

Maria Nikolova

Karpeles argues that the Illinois Northern District Court should stay the case in light of civil rehabilitation proceedings in Japan that are likely to provide full recovery to former MtGox clients.

The legal proceedings related to the collapse of ill-fated Bitcoin exchange MtGox continue in the United States. On Monday, February 25, 2019, Mark Karpeles, filed a document with the Illinois Northern District Court seeking to stay one of the cases launched by former MtGox customers in the United States.

In the document, seen by FinanceFeeds, Karpeles moves the Court to stay the case in light of civil rehabilitation proceedings in Japan that are likely to provide full recovery to the plaintiffs – Gregory Greene and Anthony Motto. In the alternative, Karpeles moves to strike the class allegations in the plaintiffs’ Fourth Amended Complaint because, according to the defendant, a class action is not the superior method to resolve this controversy.

Gregory Greene and Anthony Motto seek to hold Karpeles personally liable for any losses they sustained from their investments in bitcoin on the Mt. Gox exchange that they could not recover as claimants in Mt. Gox’s bankruptcy proceedings.

Karpeles argues that through a series of events, notably the recovery of a significant amount of lost bitcoins and the rise in the value of bitcoins, the likelihood that the plaintiffs and others will obtain a full recovery in Mt. Gox’s Japanese legal proceedings is high. Whether that will happen should be known within a matter of months, he says.

In light of the status of the Japanese proceedings, this case should be stayed in order to conserve judicial resources and to preclude unnecessary legal expenses. In the alternative, the Court should strike the class allegations, as a class action is not the superior method to adjudicate this controversy, according to Karpeles.

Let’s recall that, in January this year, the Court indicated that it will nix the defense claims made by Mark Karpeles in a case brought by former MtGox clients. In a brief notice filed on January 11, 2019, the parties in the case were directed to “proceed on the assumption that Defendant Karpeles’s motion to dismiss will be denied”.

In his motion to dismiss, Karpeles insisted that, under binding Seventh Circuit law and the evidence submitted to the Court, the Illinois Northern District Court lacks personal jurisdiction over him, and the case against him must be dismissed.

Read this next

Digital Assets secures preliminary approval to operate in Canada, one of the longest-established crypto platforms, has become the first digital asset platform to sign a Pre-‘Registration Undertaking’ with the Ontario Securities Commission (OSC) in Canada.

Retail FX

CySEC hits IC Markets One with regulatory warning

The Cyprus Securities and Exchange Commission has once again stepped up its fight against unauthorized brokers.


XTAGE now offers bitcoin and ether trading to 3.6M Brazilian investors

Brazilian financial services giant XP has officially launched its crypto trading platform XTAGE, which was built on major American stock exchange Nasdaq’s trading technology.

Institutional FX

FX volume drops 7pct at CLS Group in July 2022

FX settlement specialist CLS Group today reported that the executed volumes of currency trading on its platforms were notably down in July.

Digital Assets

Web3 startup PIP integrates with Binance ecosystem

Web3 payment provider PIP has announced integration with the Binance ecosystem, which allows the firm to vastly develop and propose needed products and improvements that are worthy of competing with others chains.

Industry News

Celsius $750m insurance claims are fraud, says lawyer seeking EU crypto superfund

“It is an intentional deception in aid of a billion-dollar securities offering.”

Institutional FX

DGCX brokers authorized to provide derivatives trading and clearing services

The DFM is looking to provide multiple asset classes such as; equities, ETFs, equities’ futures, crude oil futures, etc. to meet the growing demand from its diversified base of local and international investors.

Digital Assets

EQONEX leaves “crowded crypto exchange space” amid crypto winter

“The recent extreme market volatility and declining trading volumes have added to the headwinds being felt by exchange operators. We take a realistic view that our exchange will not move the needle for us financially over the near-to-medium term.”

Digital Assets

FTX and Paradigm partner for spreads trading: lower risk, lower fees

“This structured spread trading product is the first that will enable crypto investors to utilize cash and carry trades through FTX and Paradigm.”