According to the law firm representing the individuals who filed a class action lawsuit against the former Bitcoin exchange, Mt. Gox, in an Ontario Court of Justice, the lawsuit is to be dismissed on 17th June 2016 after a decision taken by all the parties that were involved. It seems that the decision has been arrived at after mutually agreeing to all the terms regarding its dismissal. As per this decision, there would not be any official trial of the Bitcoin exchange in Canada. However, this decision would surely upset many Canadians whose funds went down with Bitcoin exchange Mt. Gox as this was the only class action lawsuit against the company in the country.
The Bitcoin Exchange and the Class Action Suit
The class action lawsuit was filed in 2014 and sought CAD $500 million as compensation from the Bitcoin exchange Mt. Gox, its CEO Mark Karpeles, the former bank of the company Mizuho (Tokyo based), the parent company Tibanne KK, and Jed McCaleb, the founder of the website. Many Canadians had placed their deposits in the Mt. Gox (Japan-based) Bitcoin exchange. The depositors lost their money when the exchange collapsed in February 2014 with an equivalent of Bitcoin assets valued at $350 million at the time.
The primary reason as to why the bid became unsuccessful was the bankruptcy filed by Bitcoin exchange Mt. Gox in Japan last year, which was honored by the domestic courts in the country. Ted Charney, the Toronto solicitor who is handling the case, noted that the problem was aggravated by the fact that the main defendants went bankrupt, and the other parties concerned were in Japan.
Had Bitcoin exchange Mt. Gox won the case, the claimants would have had to pay up millions of dollars as costs to the now defunct exchange. It is unlikely that the plaintiffs would have been ready to take up such a huge a risk. This is seen as yet another reason for the dismissal of the lawsuit.
Nothing was heard of the class action lawsuit after 21st April 2015, and therefore, the news of the case dismissal purportedly failed to surprise many of the claimants. The absence of an update for over a year indicates little or no progress in a lawsuit.
For now, with the case dismissal, the chance for the Canadians to win the compensation is a zero unless the affected individuals still wish to pursue a case. However, these new cases will be under limitation periods as the claims have to be sought within a given period of the time of the incident. In Ontario, plaintiffs who wish to receive restitution have to file a lawsuit within a period of two years.
A class action lawsuit is going on in the United States against Mizuho. Bitcoin exchange Mt. Gox’s bank was added to a lawsuit that already existed, implicating the banking institution, as it was aware of the fraud and continued to help the Bitcoin exchange with its banking services. Mizuho had requested that the case is moved to Japan, and Chicago federal judge purportedly rejected this. In the US, however, the claimants do not have to pay costs to the winners as in Canada.