OUST EtherDEG: CEO requests $ 2.25M in default judgment

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As always, Rosario's abstracts are "NMR" and Palley's summaries, "SDP". This week's publication by Susan Joseph entitled "SJ"

Wenqing Liu c. Jun Chen, 2019 N.Y. Miscellaneous. LEXIS 1134 *; 2019 NY Slip Op 30662 (U) (March 15, 2019)[SDP]

If you do not respond to a lawsuit, a court will write a default judgment against you. That's what this order is about: an application for default judgment in a case involving "EtherDEG", a decentralized cryptocurrency exchange integrated into the British Virgin Islands.

According to the complainant, the complainant alleges that during the final days of the last crypto boom, in December 2017 to be more specific, "he was appointed CEO of EtherDEG and has been granted an annual salary of 125 $ 000, representing a 11.25% interest, and the right to receive commissions (it does not claim how much) from the first EtherDEG coin offer (which took place on January 15, 2018) . He was subsequently fired by the defendant, a Chinese citizen.

The complainant commenced the lawsuit almost a year ago, on April 30, 2018. According to the opinion, the plaintiff claims to have served the complaint on EtherDEG with the complaint of his registered agent at BVI, but neither EtherDEG nor Jun Chen did not answer nor file opposition papers.

The plaintiff applied to the court for an order allowing him to deposit the $ 2.25-million EtherDEG cryptocurrency in the "register" of the court so that the court can tell who it belongs to.

What is a judicial register exactly? It can be a safe, a bank account, a locked filing cabinet. What is uncertain is how the plaintiff thinks his "EtherDEG would be" held by a trial court in Manhattan. In a footnote, he says "he does not express any opinion as to whether this is possible. ? A device? A software portfolio? Will a court really want to interfere? If I asked a court to keep cryptography in a registry, I would be extremely sophisticated about exactly what that means).

The plaintiff is also seeking $ 10 million. Although the respondent did not respond, the court appears skeptical of this claim, noting that "

Be that as it may, the default motion for judgment poses a fundamental problem: the court was not satisfied that the plaintiff could prove liability or damages. According to the court, under New York law, default judgments are not approved once jurisdiction is established. Thus, the court dismissed the motion and asked the plaintiff to provide a more detailed explanation of the liability and a clear explanation of the terms of the contract that governed and were violated.

The Block is pleased to present a legal expert badysis of cryptocurrency, provided by Stephen Palley (@stephendpalley) and Nelson M. Rosario (@nelsonmrosario). They summarize each week three cryptocurrency cases and gave The Block permission to republish their comments and badyzes in full. Part I of this week's badysis, Crypto Caselaw Minute, is presented above.