Karis v Digital CC Management Pty Ltd (No 2) [2022] FCA 859

Karis v Digital CC Management Pty Ltd (No 2) [2022] FCA 859

Given the centrality and significant value of the disputed bitcoin, the contested rights thereto, the applicant’s residence outside Australia and lack of Australian assets, and the need to ensure effectiveness of the anti-suit injunction and availability of the asset for execution of any future judgment, it is appropriate and within the Court’s power to order the applicant to notify the Mt Gox rehabilitation trustee of the transfer of his claims to an independent Australian trustee company (Boutique Capital) to hold the bitcoin or proceeds on trust pending resolution of this proceeding. The arrangement does not prejudice the applicant’s interests and preserves the status quo without...

Parties
Applicant: Alexander Karis; First Respondent: Digital CC Management Pty Ltd; Second Respondent: Digital CC Holdings Pty Ltd; Third Respondent: Eugeni Yurievich Tsvetnenko
Jurisdiction
Australia
Judgment Date
22 July 2022
Procedural Posture
Interlocutory Application / Post Ex Parte Anti Suit Injunction; Application for Orders Facilitating Preservation of Bitcoin Pending Substantive Proceedings
Outcome
Orders made requiring notification of claim transfer to Boutique Capital to act as trustee for disputed bitcoin pending resolution; further case management hearing to be listed; costs reserved.
Legal Topics
Anti Suit Injunction, Interlocutory Relief, Asset Preservation, Trusts and Trustees, Cryptocurrency Disputes
Practice and Procedure Commercial Law Corporations Law Anti Suit Injunction Interlocutory Relief Asset Preservation Trusts and Trustees Cryptocurrency Disputes

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Parties

Alexander Karis

Applicant

Digital CC Management Pty Ltd

First Respondent

Digital CC Holdings Pty Ltd

Second Respondent

Eugeni Yurievich Tsvetnenko

Third Respondent

Procedural Posture

Interlocutory Application / Post Ex Parte Anti Suit Injunction; Application for Orders Facilitating Preservation of Bitcoin Pending Substantive Proceedings

Legal Issues

  1. 1 Whether orders should be made to require the applicant to transfer claims related to disputed bitcoin to an Australian trustee pending resolution of proceedings
  2. 2 Appropriate arrangements to preserve rights to disputed bitcoin during proceedings
  3. 3 Whether the anti-suit injunction should be vacated if orders are not complied with

Ratio Decidendi

Given the centrality and significant value of the disputed bitcoin, the contested rights thereto, the applicant’s residence outside Australia and lack of Australian assets, and the need to ensure effectiveness of the anti-suit injunction and availability of the asset for execution of any future judgment, it is appropriate and within the Court’s power to order the applicant to notify the Mt Gox rehabilitation trustee of the transfer of his claims to an independent Australian trustee company (Boutique Capital) to hold the bitcoin or proceeds on trust pending resolution of this proceeding. The arrangement does not prejudice the applicant’s interests and preserves the status quo without...

Court Disposition

Orders made requiring notification of claim transfer to Boutique Capital to act as trustee for disputed bitcoin pending resolution; further case management hearing to be listed; costs reserved.

Orders

  • By 5.00 pm (AWST) on 29 July 2022 the applicant is to notify the rehabilitation trustee of Mt Gox Co Ltd of the transfer of his claims in the rehabilitation to Boutique Capital Pty Ltd, to be held by Boutique Capital on trust pending resolution of these proceedings and in accordance with order 3.
  • Such notification is to be made by the applicant in accordance with the online or offline manner set out in memoranda provided to the applicant's solicitors.