Ex-EtherDEG Cryptocurrency CEO Requests $10 Million as Default Judgement

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

The displaced CEO of EtherDEG, a decentralized cryptocurrency exchange based in the British Virgin Islands, has requested the Court, in an ongoing lawsuit, to enter a default judgment in his favor.

What Is A Default Judgement?

A default judgment is a permanent ruling passed by a court and in favor of the plaintiff, if it happens that a defendant does not respond to a court summons and does not show up in court. Also, the court is obligated to consider any damages included in the suit, except the court deems it necessary to request for proof of damages.

The Plaintiff’s Case

The Ex-CEO of EtherDEG made the following claims.

  • That during the crypto boom, specifically in December of 2017, he was appointed as the CEO of EtherDEG.
  • That he was allowed $125,000 as his annual salary.
  • That he was allowed an equity stake of 11.25%
  • That he was also given the right to accept an unspecified amount of commissions earned from the firm’s Initial Coin Offering (ICO) which took place on the 15th of January, 2018.
  • That he was after this, dismissed by the Defendant.

    On the 30th of April, a little over three months after his alleged dismissal, the complainant then filed the suit against the Defendant but the court is yet to receive any response or counter-filing.

    Furthermore, the complainant requested the court to allow him to transfer EtherDEG cryptocurrency to the court's registry. He has claimed that the crypto in question is worth about $2.25 million and he wants the court to rule on the rightful owner of the asset.

    The Plaintiff has also requested that the court grant him $10 million as the default judgment because he allegedly lost

“at least $10,000,000 in compensation.”

How Possible Is It For The Court To Officially Hold The Crypto?

A court registry, mentioned here, could be anything the court may use to hold any confidential material. However, it could literally be anything from a cabinet, a wall safe, a bank account or a safe deposit box. The request by the plaintiff is very unclear as to how he expects the court would hold the crypto if it so accepts too. The court however has

“no opinion at this time as to whether this is possible.”

The Court's Response

The court has now denied the request and asked the plaintiff to bring forward a more explanatory response as to the breach of contract and how he may have lost up to $10 million especially as his annual salary was $125,000.

We would like to think TheBlock for the insights and feedback regarding this matter.

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