Mark Karpeles Seeks for Dismissal of Mt. Gox Class Action Suit

Mark Karpeles seeks judgment in his favour to the Mt. Gox class action suit brought by a former Mt. Gox customer. According to Karpeles, no evidence of his negligence has been produced. The rehabilitation of Mt. Gox’s creditors is still ongoing. Will the Appeal of the Former Mt Gox CEO for a class action suit dismissal be approved?

09 January, 2020 | AtoZ Markets – Mark Karpeles, former Mt. Gox CEO, appeared in court and appealed to dismiss a class action lawsuit brought against him by the victims of the bankrupted crypto exchange. According to the documents filed on Wednesday at an Illinois district court: “Karpeles is demanding a summary judgment that would relieve him of all charges.”

Will the Appeal of Former Mt Gox CEO be Approved?

Gregory Greene, the main plaintiff of the class action suit, sued Karpeles in 2014 due to the loss of his holdings stored at the bankrupted crypto exchange. He also claimed that the former CEO was involved in conversion, negligence and consumer fraud.

Mr. Greene filed his original complaint against Karpeles on 27 February 2014. The plaintiff filed three subsequent amended complaints on 17 March 2014, 17 April 2015, and 4 April 2016. However, he presented his fourth amended complaint on 7 March 2017. The recent filing by Karpeles’s lawyers stated that Mr. Karpeles should be given a summary judgment in his favour for each of the three counts alleged and brought against him in the operative Fourth Amended Complaint for a host of reasons. Those of which are:

  • The First: Count I for conversion
  • The Second: Count II for negligence
  • The Third: Count III for consumer fraud

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Why does Gregory Greene Seek to Hold Karpeles Accountable?

Greene tries to hold Karpeles responsible for the misconduct. That led to the loss of more than $400 million from US users of the MtGox bitcoin exchange on theories of negligence, conversion and fraud. Currently the  The plaintiff also argues that, as the CEO of MtGox, Karpeles controlled all aspects of the exchange. However, he was responsible for the code behind the exchange. Also, he was aware of bugs and other security issues affecting the crypto exchange and controlled what information were disclosed to MtGox customers. 

In the filed documents to the court on 7 January 2020, Karpeles insists that he is entitled to the summary judgment. Because, according to the defendant, Greene did not produce any evidence in support of the conversion (Count I). Besides, Karpeles also claims that Greene did not produce any evidence that Karpeles was negligent. Also, he cannot recover the economic damage solely based on an Illinois negligence claim (Count II). Greene has contradicted his accusations. Furthermore, he is unable to demonstrate the existence of false statements that amount to alleged consumer fraud (Count III).

In particular, a Japanese court held Karpeles responsible for data manipulation last year but acquitted of embezzlement. According to the recent filing, the plaintiff’s claims have dissolved, and any solid evidence don’t support the claim. On the last note, the filing added: “Mr. Greene has no evidence to support a conversion request”.

Do you think that the appeal by the former CEO of Mt. Gox be approved? Let us know in the comments section below.

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