updated 06:10 pm EDT, Thu July 24, 2014
Court order stops holding company from selling assets as part of CoinLab dispute
A US District Court judge in Washington state issued a restraining order yesterday, placing a temporarily restriction on the bitcoins.com domain from being auctioned off. Yesterday, Tibanne KK, the company owned by former Mt. Gox CEO Mark Karpeles, was ordered to account for and hold all assets. The order stems from a legal issue between CoinLab and Mt. Gox dating back to 2013.
The restraining order grants a 14-day injunction against the sale of assets by Tibanne KK. Chief US District Judge Marsha Pechman barred the company from selling, transferring, destroying, altering or disposing of any items used, directly or indirectly, by Mt. Gox. The order resulted in Heritage Auctions pulling the listing, which was scheduled for sale today.
"The lot is being held for now so we can get this sorted out one way or the other," Heritage Auction spokesman Noah Fleisher told Ars Technica. He added that he had not heard from Karpeles regarding the auction.
Judge Pechman said in her findings that granting the order was issued in the public interest. In the court document, Tibanne would be required to provide a list of all controlled and operated websites to CoinLab. The websites tied to Mt. Gox could not be changed in any manner, requiring them to maintain the same state they held on February 24. As part of granting the order, CoinLab would have to put up a $5,000 bond.
"There is good cause to believe that immediate and irreparable damages to the Court's ability to grant effective final relief for the Plaintiffs in the form of damages and monetary restitution will occur from the sale, transfer, assignment or other disposition or concealment by Defendant Tibanne KK of their assets or records, unless Tibanne KK is immediately restrained and enjoined by this order," stated Pechman.
CoinLab sued Mt. Gox last May, after it failed to provide the necessary resources as outlined in their partnership. The lawsuit, which is looking for $75 million in damages, started after the digital currency startup claimed an exclusivity agreement between the two companies was breached. CoinLab maintains Mt. Gox served customers in North America after giving the startup an exclusive deal. Mt. Gox filed its own suit in September, asking for $5.5 million in damages, after alleging CoinLab failed to become registered and licensed for operation with the government.