Ousted Bitmain Co-Founder Wins Partial Victory in Newest Authorized Battle

Micree Ketuan Zhan, the ousted co-founder and former chairman of main bitcoin mining tools producer Bitmain, has scored a partial authorized victory over his former employer. 

The Beijing Haidian District Bureau of Justice on Tuesday granted Zhan’s request to dam the corporate from registering CFO Luyao Liu because the authorized consultant of its Beijing department, Bitmain mentioned. CEO Jihan Wu is presently the registered consultant, and Bitmain mentioned it wished to change the registration to Liu to enhance effectivity.

The bureau had permitted the registration change on Jan. 2, however Zhan appealed the choice in February and requested the bureau to register him because the authorized consultant, a title he as soon as held, as a substitute. 

Whereas the bureau didn’t register Zhan because the authorized consultant, its reversal of the change from Wu to Liu might be important. In China, naming a authorized consultant is far more than a formality; often the chairman or CEO, this particular person has broad powers to behave on an organization’s behalf.    

“We deeply remorse the choice and assume the bureau has violated company legal guidelines, and our firm’s autonomy by way of administrative measures,” Bitmain mentioned in an announcement the identical day. Hong Kong-based Bitmain Applied sciences Restricted, whose CEO is Wu, has the suitable to alter its authorized consultant since it’s the Beijing subsidiary’s sole shareholder, the corporate mentioned.

“We’ll file a lawsuit in opposition to the bureau to guard our firm, shareholders and workers,” the corporate mentioned within the assertion.   

The authorized dispute is the newest chapter in Zhan’s ongoing battle with Bitmain since his departure plotted by his fellow co-founder Wu final October. The 2 executives had sparred over varied administration points as early as 2015. 

Two months after Zhan was exiled from Bitcoin, he filed a authorized case within the Cayman Islands, the place Bitmain’s father or mother holding entity is registered. He requested a courtroom to void a call allegedly handed at a shareholder assembly that considerably curtailed his voting energy. 

In March, Zhan filed one other lawsuit, this time in China, in opposition to Bitmain’s fully-owned subsidiary Fujian Zhanhua Intelligence Applied sciences and Beijing Bitmain Applied sciences as a associated third celebration. The native courtroom mentioned the case was a dispute over “shareholder qualification affirmation” with out giving additional particulars. 

Within the newest assertion, Bitmain additionally accuses Zhan of disrupting each day enterprise by drawing crowds near the corporate’s places of work, posing as its authorized consultant to switch belongings and signal contracts, dividing and threatening workers with false info and smearing the administration workforce by media protection.  

Every week earlier than Zhan’s departure and the revelation of Bitmain’s inside energy battle, the corporate confidentially filed with the U.S. Securities and Trade Fee (SEC) to go public. The applying seems to be nonetheless in course of. 

Bitmain’s competitor Canaan Artistic went public within the U.S. final December, whereas one other main Chinese language miner maker Ebang filed with the SEC for a $100 million preliminary public providing this week.