Mt. Gox Files for Bankruptcy in U.S | Hacker News Reader

Mt. Gox Files for Bankruptcy in U.S

online.wsj.com

31 pointsantonius25 comments

Article is behind a paywall.

    Mt. Gox, the struggling Japanese bitcoin exchange,
    has filed for bankruptcy protection in a U.S. court
    to stop customers from freezing any of the company's
    assets that are located on U.S. soil.
    
    Lawyers put MtGox Co. Ltd. into Chapter 15 protection
    in Texas on Sunday, stating that a potential
    class-action lawsuit in Illinois could get in the
    way of reorganization efforts that are taking place
    in the company's home country.
    
    Mt. Gox, an exchange for buyers and sellers of the
    digital currency known as bitcoin, halted customer
    withdrawals on Feb. 7, later stating that it lost
    almost 750,000 of its customers' bitcoins and around
    100,000 of its own.
    
    "This theft or disappearance is currently the subject
    of an intense investigation which required Mt. Gox
    to devote most of its resources," Mt. Gox lawyers wrote
    in court papers.
    
    In the potential class-action lawsuit, lawyers are
    trying to round up U.S. residents who paid a fee to
    Mt. Gox to buy, sell or trade bitcoin, according to
    court papers filed in U.S. Bankruptcy Court in Dallas.
    As part of that lawsuit, lawyers are expected to ask
    Tuesday during a court hearing for the power to freeze
    any of Mt. Gox's U.S. assets, which include any servers
    or other computer equipment that stores customer
    information about bitcoins.
    
    It is unclear what assets—if any—Mt. Gox has in the U.S.
    Still, the U.S. bankruptcy halts existing lawsuits, at
    least temporarily.
    
    More specifically, Chapter 15 of the U.S. Bankruptcy
    Code is available to foreign companies that have sought
    protection of their home courts.
    
    Mt. Gox filed for bankruptcy protection in Japan last
    month. Participating in the U.S. lawsuits at this
    point "would wastefully divert resources away from"
    the Japanese bankruptcy, Mt. Gox lawyers wrote in
    court papers.
    
    The company's lawyers said that Mt. Gox's debts
    totaled 6.5 billion yen ($63.9 million) versus
    assets of 3.84 billion yen.
    
    Mt. Gox hired the Baker & McKenzie law firm to
    represent it in bankruptcy. The company's case,
    numbered 14-31229, has been assigned to Judge
    Stacey G. Jernigan.
    
    —Jacqueline Palank contributed to this article.
    
    Write to Katy Stech at katherine.stech@wsj.com

That doesn't make it acceptable for you to completely ignore their copyright on that material.

It does, however, make it inevitable that it would happen.

I agree, it's not the paywall that makes it acceptable.

"Information wants to be free" doesn't justify that you should ignore their copyright just because you can easily ignore their paywall with little consequence to yourself.

I agree, the paywall being easy to ignore with little consequence to oneself is not what justifies ignoring their copyright.

Ah, is this one of those things were copyrights don't matter since you aren't a musician, director, writer, etc? And software should be paid for? Or if you open source your work then there is no problem me incorporating that into my closed source project, since copyright doesn't matter?

I don't want to pollute this thread with an offtopic discussion. If you want to talk about it feel free to send me an email, it's on my profile.

That would be fine if there was no copyright.

GPL use is only useful as long as copyright exist: should it not exist then GPL is not just not useful anymore but not needed at all!

I'd just disassemble what you did and release it as open source again :D

Thanks for the paste. Fuck paywalls.

Fuck compensating people for their goods and services!

Flagged

Brings up an interesting point:

Is it possible and how would you freeze bitcoins owned by a person(or a specific wallet).

The only way, per the system's design, would be a network wide whitelist or blacklist of accounts. Either explicitly permitting (which wouldn't work) or explicitly blocking addresses from participating in transactions. And, if enough computers disregarded it, the transactions would still go into valid blocks. The blacklist/whitelist nodes would have to accept those blocks or you'd end up with a forked blockchain or serious accounting issues because some nodes would disregard certain transactions.

A court could simply order them frozen, and expect the holder to comply. If the court deems that too dangerous, they would order them transferred to a third party guardian (usually the local sheriff or similar, but they might make a different arrangement for something unusual like bitcoin). Possibly "without notice", if "dissipation" seems likely if the holder knows it's coming.

Pretty much the same as you'd do with cash or other physical assets.

(Transfer is necessary; seizing the private key isn't secure against copies. The FBI is known to have moved the Silk Road money to their own wallet: http://blockchain.info/address/1F1tAaz5x1HUXrCNLbtMDqcw6o5GN... )

Raid their place, copy their wallet, move the bitcoins to yours.

You can't, and this isn't about freezing bitcoins. They try to prevent people from freezing their non-bitcoin assets.

Hm... would it be possible to have a blacklist of bitcoin addresses and get a majority of miners to ignore transactions that involve these addresses?

You could have a blacklist.

You couldn't, as a practical matter, get the miners to agree on a blacklist. A partial attempt would segment the bitcoin protocol and so the miners would just avoid it completely.

Any specific reason they would file in Texas?

So a Chapter 15 is an ancillary proceeding to facilitate the bankruptcy of a foreign corporation that is happening in another jurisdiction (in this case, Japan). Venue in a Chapter 15 is appropriate either where the company its principal U.S. assets, or where it is getting sued in the U.S. See: http://www.law.cornell.edu/uscode/text/28/1410. I believe the only lawsuit right now is in Chicago (NDIL), so presumably they filed in Dallas because they had some assets there (servers, etc)?

Texas is known as a responsive district so they won't have to wait for a court date. That could be important if they thought an investor was going to move to quickly to foreclose on assets.

Doesn't the automatic stay kick in immediately upon filing? My understanding was that the ultimate court date (or initial meeting with the trustee) wasn't as big of a concern.

From what I hear, Texas courts are generally the most friendly to businesses

Here's a docket to follow the filings in the court for those curious: https://www.inforuptcy.com/filings/txnbke_411806-3-14-bk-312...

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