Butterfly Labs Agrees To Court’s Monthly Reports.

1

It appears that embattled mining equipment manufacturer Butterfly Labs won’t be suffering from being shut down further. Today, the judge ordered the company to submit monthly reports and has ruled against the Federal Trade Commission in favor of Butterfly Labs.

The Federal Trade Commission claimed that Butterfly Labs had violated Section 5(a) of the Federal Trade Commission Act (“FTC Act”) by misrepresenting material facts about their Bitcoin mining machines and the court has now ruled that this was not the case. After reviewing the premises, the record, and the applicable law, the Court disagreed with the FTC.

In the matter of delivery date falsification, the court ruled that the FTC had not provided enough evidence to back the claims made. While the FTC was able to prove several delivery date statements, they were unable to prove the statements were intentionally false.

In regards to false profitability statements from BFL ,the court found that insufficient evidence was presented by the FTC. While the FTC provided several examples of profitability claims, they were unable to give documented examples of specific profitability statements from the company in advertising, on the website, or in messages. The court ruled that the FTC failed once again to show evidence.

The court also found that it is unlikely that BFL would go back to the same questionable business model of preorders after having shown it had stopped doing so before the FTC obtained an ex-parte order against them and the USMS raid against the facility.

While the courts disagreed on all points made by the FTC and will now allow BFL to resume operations, they are ordering the company to begin submitting monthly reports to the court. A copy of the full orders from the court can be found here.

The report will address:

  1. Status of manufacturing and shipping to the current order queue, number of customers requesting shipment/service activation, number of customers delivered, projected number of customers still requiring shipment and anticipated shipment timeframes;
  2. Assessment of remaining pre-order refund liability, including status of refund requests and status of reserve or progress toward generating assets to pay out all requested refunds in a timely manner;
  3. Corporate governance progress;
  4. Reaffirm that the no pre-order policy remains in effect and that only consumer sales of in-stock items are occurring;
  5. Status of burn testing and report on segregated proceeds; and
  6. Key communications made and/or planned with customers.

The court will wind down the temporary receivership and begin allowing Butterfly Labs to resume full operations on a timeline that will be established via a telephone conference call on December 22nd. The reports given to the courts on a monthly basis will take place under a court order seal prohibiting the public from reviewing them. The first report must be filed no later than January 30th of 2015.

Many in the community will likely be shocked as it was widely believed the level of misconduct to be wide and far-reaching based on the first findings and documentation presented about the case. The case will continue, but without the current restrictions against Butterfly Labs or a suspension in operations.

How do you feel about this order from the court? Be sure to leave your comments.

Find the best exchange to buy Bitcoins


Coin Fire

Coin Fire is a cryptocurrency news site started on June 6th of 2014. The site focused on hard-hitting investigative stories. Coin Fire was acquired by 99Bitcoins on October 2015.

1 Comment

Leave A Reply