The shareholders of the Marathon Digital Holdings, a Bitcoin (BTC) mining company, are reported to have filed a lawsuit against the CEO, Fred Thiel as well as some upper management personnel’s of the firm over the violations of financial responsibilities and more.
Marathon Shareholders have Sued Officials
On July 8, a shareholder case was brought in the United States District Court for the District of Nevada against Fred Thiel along with nine more Marathon officials. The complaint was filed over five allegations which include failure to comply with the US Securities Exchange Act, the violation of fiduciary responsibilities, unfair advantage, and wasting assets belonging to corporations.
Fraudulent Inflation of Market Value
The legal team claimed that the leadership team took part in disregarding the company’s issues, fraudulently inflating Marathon’s valuation, obtaining enormous payouts, generating attractive secret transactions, as well as getting unfairly increased incentives due to erroneous and deceptive representations.
Marathon Shareholders Seek Compensation
In addition, the plaintiffs seek compensation from Thiel, Merrick Okamoto, Simeon Salzman, and Hugh Gallagher for improper activities that resulted in a Securities and Exchange Commission (SEC) lawsuit against the business.
However, no precise amount of compensatory money has been provided in the filing. As a result, the decision is now in the hands of the court.
Reduction in Amount of BTC Mined
It is important to note that the mining business recently ascribed a reduction of the amount of Bitcoin mined in June to bad weather in Texas, where Marathon’s principal facilities are located. Notably, a July 5 report stated that Marathon Digital encountered a 21% decrease in the total amount of Bitcoin created in June compared to the previous month of May.
Back in April, the company announced that 825 BTC were mined in March, raising the total number of Bitcoin generated in the first quarter to 2,195 BTC. In accordance with the Marathon Digital monthly operations report, that was an all-time high.