The US District Court of Seattle Restrains Sellers of Bitcoins.com

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The US District Court of Seattle Restrains Sellers of Bitcoins.com
The US District Court of Seattle Restrains Sellers of Bitcoins.com

The US District Court of Seattle Restrains Sellers of Bitcoins.com

Now the sellers of Bitcoins.com won’t be able to do so as a restraining order has been issued by the US District Court of Seattle. The stay order has cancelled the much anticipated auction of the Bitcoins.com which is currently owned by Mt. Gox CEO Mark Karpeles through his company, Tibanne KK. The domain name was expected to be sold on July 24, 2014 i.e. today.

The auction to be held by US-based auction house Heritage Auctions won’t go on the expected line as the US District Court of Seattle has intervened now. The court order came when Bitcoin startup CoinLab which earlier agreed to support Mt. Gox’s bankruptcy plan moved to prevent the sale.

In his press statement CoinLab lawyer Roger Townsend made it clear that the company, while supportive of the bankruptcy proceedings, would not allow the sale of its assets without permission. Now, Tibanne KK has been ordered to preserve and account for all held assets that include the domain name the Bitcoins.com.

Townsend further divulged that his client is pleased that the court entered an order requiring Tibanne to preserve and account for all of its assets, including any ownership it might have in Mt Gox, domain names or payments that it has received since the bankruptcy. Also, it sends a strong message to Tibanne that they cannot dissipate assets without the court’s approval.

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Order to Serve the Public Interest

The restraining order says that there is good cause to believe that immediate and irreparable damage to the court’s ability to grant effective final relief for plaintiff in the form of damage 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 enjoyed by this order.

The lawyer for CoinLab argued in the court that the domain name auction would have a significantly negative impact on Mt. Gox’s bankruptcy process and the ability for creditors to recoup lost funds. The US District Court of Seattle agreed to the arguments from CoinLab and admitted that the order is “in the public interest.”

The court order says that prohibiting Tibanne KK and any of its employees from taking any action that might affect control or ownership of the company’s assets; it is serving the larger interest of the stakeholders. However, the relief is for just 14 days, after which time an extension will be considered by the court.

To contact the reporter of this story: Deepak Tiwari at deepak@forexminute.com