Mt. Gox files for US bankruptcy to halt class-action suit

The company is trying to temporarily halt a US lawsuit as a Tokyo court works through its bankruptcy

Mt. Gox, the Tokyo-based Bitcoin exchange that collapsed last month after the loss of around $474 million worth of Bitcoins, has filed for bankruptcy protection in the U.S.

The petition, made late Sunday in the U.S. Bankruptcy Court in Dallas, will be heard later Monday -- a day before a court in Chicago is expected to rule on whether a U.S. class-action lawsuit can proceed against the company.

If successful in its Dallas filing, lawsuits in the U.S. against the company would be temporarily halted.

That would give Mt. Gox a little breathing room while the Tokyo District Court works through the collapse of the company and how best to proceed with bankruptcy.

The Chicago case is one of two that have been filed against Mt. Gox. A second case was filed in May 2013 by Coinlab alleging breach of contract.

Mt. Gox was once the largest Bitcoin trading exchange in the world, offering a platform where customers could buy and sell the virtual currency for real-world cash.

But that all came to a halt Feb. 25 when the company suspended trading and admitted it had lost around 750,000 Bitcoins owned by customers and around 100,000 of its own. An investigation into the loss is ongoing, but the company has said it believes a flaw in the Bitcoin software allowed an unknown party to steal the Bitcoins.

The filing estimates the company has more than 100,000 creditors, assets of ¥6.5 billion (US$63 million) and liabilities of ¥3.84 billion.

It was made on behalf of Mt. Gox by Mark Karpeles, the company's sole board member. Mt. Gox has two shareholders: Tibanne Co. Ltd., which owns 88 percent, and an individual, Jed MacCaleb, who holds 12 percent. MacCaleb developed the software that ran the service.

The case is 14-31229, MtGox Co. Ltd., in the U.S. Bankruptcy Court for the Northern District of Texas.

Martyn Williams covers mobile telecoms, Silicon Valley and general technology breaking news for The IDG News Service. Follow Martyn on Twitter at @martyn_williams. Martyn's e-mail address is martyn_williams@idg.com

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags securityinternete-commerceencryptionMt. Gox

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Martyn Williams

IDG News Service
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Walid Mikhael

Brother QL-820NWB Professional Label Printer

It’s easy to set up, it’s compact and quiet when printing and to top if off, the print quality is excellent. This is hands down the best printer I’ve used for printing labels.

Ben Ramsden

Sharp PN-40TC1 Huddle Board

Brainstorming, innovation, problem solving, and negotiation have all become much more productive and valuable if people can easily collaborate in real time with minimal friction.

Sarah Ieroianni

Brother QL-820NWB Professional Label Printer

The print quality also does not disappoint, it’s clear, bold, doesn’t smudge and the text is perfectly sized.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?