Bitcoin mining firm Proton Management asked a Californian court to dismiss the lawsuit brought by Swan Bitcoin against it over severe flaws.
Proton Management has filed a motion to dismiss Swan Bitcoin’s lawsuit against its employees. Swan accused its ex-employees of stealing proprietary software that it created for its mining arm and quitting in droves to start Proton.
The September 30 motion to dismiss claimed that Swan did not even have a Bitcoin mining business. The mining entity, called 2040 Energy, was funded by Tether and supposedly not a part of Swan. Thus, Proton Management’s employees who worked at Swan had no connection to the mining entity.
Proton’s filing called the suit a ‘litigation to ambush.’ It read, “Swan’s filings appear to be nothing more than ‘litigation by ambush’ to disparage its former employees and contractors in order to gain leverage in its dispute with Tether.” It added, “It is highly questionable whether any of the information identified in Swan’s complaint actually belongs to Swan as opposed to 2040 Energy.”
Furthermore, Proton claimed it was formed when Swan’s business affairs were so bad that it laid off many employees just a few months ago. While the accused firm mentioned that 2040 Energy and Swan were distinct entities, it agreed the latter had a minority stake in the former. Proton also justified its request for the suit’s dismissal as the court Swan approached does not have jurisdiction to deal with it. Swan filed suit in a California court—Proton is registered in the British Virgin Islands.
Swan Claims Tether Stopped Funding it and Partnered With Proton Instead
The suit was brought on September 25, with Swan claiming its former employees pulled the wool over its eyes to start the new mining operation and push Tether to end ties with it and fund Proton. It claimed all that prevented Swan’s ability to operate a successful mining business.
It called its former Head of Business Development, Michael Holmes Proton’s “ringleader.” Swan’s ex-chief investment officer and mining head, Raphael Zagury, serves as Proton’s CEO. It blamed the two individuals for orchestrating the “rain and hellfire” plan to unethically disrupt its mining business. They claimed their resignations stemmed from Swan being unable to run its business appropriately.
Swan’s CEO Cory Klippsten previously announced shutting down 2040 Energy due to problems with sustaining it profitably. The suit depicts that the firm could have relieved itself of the mining entity by handing it over to Tether. It has asked the court for a permanent injunction against Proton’s operations and for Proton to return its stolen proprietary material and equipment.
