Bitcoin Mining Dispute: Crypto Infiniti Files Complaint Against Blockquarry and Pantheon
On Friday, September 6, 2024, Crypto Infiniti filed a complaint in the United States District Court for the District of South Carolina against Blockquarry Corp., formerly known as ISW Holdings, Inc., and Pantheon Resources, Inc. The lawsuit arises from allegations of conversion, negligence, breach of contract, and unjust enrichment concerning the ownership of Bitcoin mining equipment and containers.
Crypto Infiniti, based in Reno, Nevada, claims it is the rightful owner of approximately 1,882 Bitcoin miners and two specially designed shipping containers located at a site in Gaffney, South Carolina. According to the complaint, the plaintiff entered into a Hosting and Security Agreement with Bit5ive LLC, a company associated with various entities involved in cryptocurrency mining. This agreement allowed Crypto Infiniti to deploy its miners at the Gaffney site, where Bit5ive was responsible for providing the necessary infrastructure and services.
The court documents outline that Crypto Infiniti purchased the miners from Bitmain Technologies Limited and had them shipped directly to the Gaffney location. Additionally, Crypto Infiniti alleges that it fulfilled all financial obligations to Bit5ive, including paying for hosting and electricity services associated with the miners’ operation.
However, the complaint asserts that the Gaffney site was subsequently shut down and padlocked, which prevented Crypto Infiniti from accessing its equipment. This shutdown was reportedly influenced by ongoing litigation involving Blockquarry and the owner of the Gaffney site, the Gaffney Board of Public Works. Blockquarry has been engaged in legal disputes related to lease agreements and utility services at the site, which have allegedly contributed to the retention of Crypto Infiniti’s miners and containers.
The complaint also highlights that Blockquarry referred to itself as the “bailee” of the personal property at the Gaffney site during its litigation with the Board. This designation, if upheld, would impose an obligation on Blockquarry to return Crypto Infiniti’s property.
Crypto Infiniti asserts that it notified Blockquarry of its ownership of the equipment through email correspondence in May 2023, yet the defendants failed to return the miners and containers. The complaint further alleges that Blockquarry and Pantheon, which is involved in securing land for data processing related to artificial intelligence, coordinated to remove the miners from the Gaffney site to an undisclosed location in Missouri.
The lawsuit includes multiple causes of action. The first claim is for conversion, alleging that both Blockquarry and Pantheon wrongfully took possession of Crypto Infiniti’s miners and containers for their own use. The plaintiff claims this unauthorized retention has caused significant financial harm due to the inability to utilize the miners for Bitcoin mining operations.
The second cause of action pertains to negligence and gross negligence against Blockquarry. Crypto Infiniti contends that Blockquarry breached its duty of care as a bailee by retaining possession of the equipment, resulting in foreseeable damages for the plaintiff.
Additionally, the complaint alleges breach of contract against Blockquarry related to a settlement agreement reached in the Litchain litigation. Crypto Infiniti claims that it is a third-party beneficiary of this agreement, which purportedly required Blockquarry to return the equipment to its rightful owners.
The fourth cause of action focuses on unjust enrichment, asserting that both defendants have unlawfully benefited from the use of Crypto Infiniti’s miners and containers without compensating the plaintiff. The lawsuit argues that this retention of property is inequitable and demands restitution.
Crypto Infiniti seeks various forms of relief, including actual and punitive damages, specific performance of the settlement agreement, and the return of its miners and containers. The complaint also requests that the court award reasonable attorney’s fees and costs, prejudgment interest, and any further relief deemed appropriate.
Please contact BlockTribune for access to a copy of this filing.
