We were engaged by defense counsel on behalf of an attorney and his law firm in which the defendants were accused of negligent and reckless legal representation in connection with a series of securities offerings. Specifically, the plaintiff, a Bitcoin mining company, alleged that the defendants’ actions caused it to suffer over $100 million in lost profits due to its inability to acquire and operate Bitcoin miners (application-specific integrated circuits, or ASICs) at one or more of its mining locations.

In performing our analysis, we assisted counsel with several aspects of discovery by creating detailed request lists, assisting in drafting subpoenas, analyzing large document productions, and more. We performed and presented complex, industry-specific calculations as a rebuttal to the plaintiff’s calculation in which we considered and accounted for installation and operational hurdles, energy pricing and availability, miner hash rates, historical and projected Bitcoin network hash rates and difficulty, comparable company infrastructure, operating expense and valuation metrics, pooling charges, and regulatory issues. 

We further considered and incorporated documentation specific to the plaintiff company and its circumstances before and after the defendants’ alleged actions. This documentation included miner procurement contracts, energy purchase agreements, hosting and infrastructure agreements, financial statements and forecasts, various prospective investor presentation and SEC filings, and other financial and operating data.

Our work ultimately assisted our client in reaching a favorable settlement in mediation.