Cryptocurrency Presents Unique Legal Remedies
Investors have struggled with companies that don’t follow through on their promises. There is a potential for hacks and fraud. But while a lot of attention has been paid to the ways that federal prosecutors and regulators like the SEC view cryptocurrency, there are personal legal implications to consider as well.
Individual Lawsuits Possible
According to a report by Coin Desk, “buyers can sue sellers privately under the federal securities laws” which govern similar types of transactions. Companies and individuals looking to make sales of cryptocurrency should be aware of these risks.
At the same time, in the ever-changing world of cryptocurrency, buyers should know that there are remedies available to them if they are treated unfairly throughout the process.
Is Cryptocurrency a Security?
A great deal of the legal details concerning cryptocurrency comes down to the question of whether or not a coin can be considered a security. This is one of the most hotly contested issues in the cryptocurrency world, and a simple answer remains elusive.
In cases where cryptocurrency is part of an offering of a security, federal law stipulates that the seller of that security must register it or find an exception. If the seller does not, the SEC may step in to enforce the sale or sanction the seller. Most investors are at least somewhat familiar with the security classification issue and its ramifications.
However, fewer cryptocurrency investors know that the Securities and Exchange Act of 1933 stipulates that a person who buys an unregistered security can actually sue the seller individually to get his money back. This puts some of the power to determine whether purchasing cryptocurrency is or is not a securities sale in the power of the individual investor. This legal detail also means that the remedy would be wide-ranging, and a company implicated in such an unregistered security sale might have to completely refund the investor base.
These issues and a buyers remedies will be part of this evolving area of cryptocurrency.
Interesting Lawsuit of the Month- JetBlue Sued by Man Forced to Ride in Lavatory
A lawsuit was filed by Gokhan Mutlu, a gentleman who alleges that Jet Blue employees deprived him of his original seat during a cross-country flight and forced him to use the lavatory toilet seat instead.
The plaintiff alleges that he was flying JetBlue on a “buddy pass,” a voucher that employees can get for their buddies. These allow you to fly on standby and apparently for free, but it seems they also put you at the very bottom of the airline-passenger totem pole. Mutlu, who was trying to get to New York, says he was first told that a off-duty flight attendant had taken the last seat on the plane, but then that she would sit in the employee “jump seat,” leaving a regular seat open for him.
Mutlu alleges, about 90 minutes into the five-hour flight, the flight attendant decided the jump seat was uncomfortable, and that’s when the pilot called him “towards the front of the plane, towards the cockpit, and advised the plaintiff that he would have to give his seat up” to the flight attendant, the suit says. Mutlu “asked if he was being directed to surrender the seat issued to him and to take the ‘jump seat’ for the remaining part of the flight, which was about 3 1/2 hours.” The pilot told him the jump seat was for “personnel only,” the suit says. Since Multu could not take the jump seat, because that was reserved for employees. And since, unfortunately, you can’t sit on the captain’s lap anymore, that left only one seat on the plane, one that is even less comfortable than a jump seat, at least for long periods of time.
Mutlu alleges that when he “expressed reluctance” to sit in the bathroom, the pilot told him that “he was the pilot, that this was his plane, under his command [and] that [Mutlu] should be grateful for being on board.” Plaintiff then reluctantly entered the chamber and took his precarious seat.
Later, on the flight the aircraft hit heavy turbulence. Passengers were directed to return to their seats, but “the plaintiff had no seat to return to, sitting on a toilet stool with no seat belts,” court papers say.
Sometime later, a male flight attendant knocked on the restroom door and told Mutlu he could return to his original seat, court papers say. The flight landed at JFK around 5:30 am, and the pilot stopped him as he was walking out “and asked if everything was okay. The plaintiff replied, ‘No,’” the suit says. The suit seeks money for emotional damages.
Now, it does sound like this guy got jerked around, and being required to ride in the lavatory would not be pleasant. If this actually happened, I would support his claim to get some kind of compensation. But public sympathy for him has been a bit muted, possibly because he is demanding over TWO MILLION DOLLARS for his three-hour ordeal.
This guy (and/or his lawyer) is demanding more than someone will ever see in an entire lifetime as compensation for being required to sit on the toilet for about three hours.
I had a dorm roommate that used to do that for free.
Quote of the Month
“If a man does not master his circumstances then he is bound to be mastered by them.” -Amor Towles, A Gentleman in Moscow