Cryptography company Catena Computing defrauded mining company Coinmint into a $150 million purchase agreement, an arbitration panel ruled last month in the mining company's lawsuit against Catena and semiconductor company DX Core. I put it down.
Coinmint alleged in a lawsuit filed last year that Katena and DX Corr conspired to buy $150 million worth of Bitcoin mining machines that were never delivered. Coinmint alleges in the suit that it bribed Michael Maloney, Coinmint's former chief financial officer, to secure the sale, knowing full well that Katena would not be able to provide the mining chips it was developing. He claimed to have influenced him in some way. The mining company demanded a refund of the $23 million it paid Catena.
In February, an arbitration panel ruled that Katena did not breach the contract or deceive Coinmint, denying all of Coinmint's claims and awarding Katena more than $14 million in damages.
According to documents filed in the court docket, the arbitration panel found that after Coinmint and its executives initially negotiated the $100 million deal, they independently made $100 million “without any pressure or influence from Catena.” It found that there was evidence to suggest that the company had opted for a $50 million acquisition. It itself raised $150 million.
The commission also ruled that Catena did not violate its contract with Coinmint, and said Coinmint itself acknowledged that it had not met all required conditions.
Coinmint cited text messages shared between Catena executives as evidence that the company was influencing Mr. Maloney, but the committee said in its report that these messages were not used by Coinmint's then-top financial advisor. He said it was more “brainstorming and ambitious chatter” than concrete evidence that the company was actively hiring a chief financial officer (CFO). .
The commission also ruled that Catena did not misrepresent the status of the chips it was developing in its marketing materials to Coinmint.
“Katena submitted extensive evidence regarding the design of the ASIC without any evidentiary rebuttal or impeachment by Coinmint.” [application-specific integrated circuit] “We will develop the chip for K10 and prepare the chip design for submission to the foundry, including running simulations to test for errors in the chip design,” the artibrator's order states.
Catena also presented other evidence suggesting that he was actively working on manufacturing chips and miners that he planned to sell to Coinmint, refuting Coinmint's claims that Catena never intended to manufacture the machines. I objected to one thing.
“We went through a full discovery process where Catena produced everything in accordance with the commission's orders, while Coinmint avoided producing everything,” said Michael Gao, Founder and Partner at Catena. said. “We both had the opportunity to hire expert witnesses to obviously defend our case. Coinmint hired its own expert witnesses and they were responsible for all of our technical planning. And we had the opportunity to review all of the content of the due diligence report. We had full access to basically all of the material that was generated in the discovery.”
Gao said the Coinmint team had a hard time identifying the false claims made by Katena. He said the committee's final report reflected this, and while Catena did not win on a technical point, it was based on the facts the committee found.
Coinmint plans to file a motion to set aside the arbitration award, Coinmint's new attorney said in a court filing.
According to an email attached to the eviction motion, the company is taking issue with how the arbitration process is unfolding. Stephen Feldman, an attorney representing Coinmint, said in an email that the commission “ruined any semblance of due process,” citing the decision to block the recording of certain witnesses as an example.
In their motion for an extension, Coinmint's lawyers wrote that they believed there was cause to set aside the order, citing the lack of recorded testimony as one example.
“The award's key factual findings are plagued by record prohibitions by the committee. For example, the award claims that one of its witnesses, Michael Maloney, former chief financial officer of Coinmint, is key to Catena's work. “There was no evidence that Mr. Catena was ever offered a contract,” the filing states. “This is patently false, as Mr. Maloney acknowledged the contrary in his testimony that the panel blocked the Coinmint recording.”
Catena's attorney disputed Coinmint's characterization of the process, according to emails submitted as evidence. “The parties have been fighting long and hard for years. … Coinmint has lost,” Perkins Coie's Jacob Taber wrote in an email.
“As you can appreciate, our clients have already waited years to pay the amounts owed under their contracts, and we need prompt resolution of any award disputes,” he said in a separate email. I'm very interested.” .
U.S. District Judge Richard Seeborg, the Northern District of California jurist overseeing the case, granted Coinmint an extension to file its objections and motion to dismiss by April 1.
A lawyer for Coinmint, which took over after the arbitration process ended, did not immediately respond to a request for comment via its website.
