MtGox Class Action Plaintiffs Agree to Settle Lawsuit

Canadian and American users of the failed Bitcoin exchange, MtGox, have come to terms and agreed to settle their class action lawsuits against the company. The lawsuits had alleged that MtGox committed fraud against its customers out of millions in dollars. According to the court filings, the plaintiffs of the class action lawsuit have agreed to go with the plans of Sunlot Holdings, a firm who wishes to buyout MtGox. They’ve agreed to take their share of bitcoins that MtGox still holds.

Class Action Plaintiffs to Settle Lawsuit

When MtGox initially filed for bankruptcy protection it cited that it had lost 850,000 bitcoins in a DDoS attack. However, it later found 200,000 bitcoins in an old-formatted wallet. Further investigation done by the ETH Zurich University in Switzerland found that only 386 bitcoins were lost by the transaction malleability attacks.

Recently, MtGox was assigned a bankruptcy trustee to overlook the liquidation and investigation of MtGox by the Tokyo District Court. The bankruptcy trustee has also been assigned to collect the claims against MtGox. In order to get any shares from the liquidation, customers of MtGox must submit a claim. The process on how to file a claim will be posted on the MtGox website at a later time.

After Sunlot Holdings buys MtGox, the Canadian and American customers of the failed Bitcoin exchange expect a 16.5% stake for settling the class action lawsuits. The customers will also be dividing the 200,000 bitcoins that was later found by MtGox and the $20 million that is held by the MtGox administrator. The lead attorney in the American case, Jay Edelson, said in a statement,

“This is the customers’ best option and the only chance they have for full restitution.”

Sunlot Holdings wants to buy MtGox for one Bitcoin. However, before the company is able to buy MtGox, it must be approved by the court in Tokyo. Jed McCaleb, MtGox’s founder, and Gonzague Gay-Bouchery, the ex-exchange’s chief marketing officer tried to help the customers pursue the class action against the other defendants. These include Mark Karpeles, the CEO of the failed exchange, banking partner Mizuho Bank Ltd, Tibanne, and others.

Take away, before this agreement goes anywhere it must be approved by the American and Canadian courts overlooking the class action lawsuits.

Image via MtGox