Gordon Law Group Accuses Founder’s CPA and Ex-Associate of Misappropriating Cryptocurrency Tax Processes

On Monday, April 8, 2024, the Gordon Law Group filed a complaint in the United States District Court for the Northern District of Illinois against former employee Justin McCormick and Founder’s CPA, alleging misappropriation of trade secrets related to cryptocurrency tax reporting.

According to the complaint, Gordon Law has developed proprietary processes, templates, and spreadsheets over many years at substantial expense to generate specialized tax reports for clients with significant investments and transactions in digital currencies like Bitcoin and Ethereum. As an associate on Gordon Law’s crypto tax team, McCormick had extensive access to and training on these confidential methods. He later took on a leadership role, assisting in the refinement of Gordon Law’s practices.

However, the lawsuit claims that upon resigning from Gordon Law in August 2022, McCormick soon joined Founder’s CPA as a senior associate. Founder’s CPA also provides cryptocurrency taxation services in direct competition with Gordon Law. Starting in March 2023, McCormick then allegedly began publicly sharing replicas of Gordon Law’s confidential documents and processes on Google Drive and in a series of instructional videos on Founder’s CPA’s YouTube channel.

The videos and materials linked to Google Drive purportedly showed McCormick and Founder’s CPA using Gordon Law’s unique templates, automated spreadsheets containing proprietary formulas and scripts, folder structures, and client forms to replicate the firm’s multi-step process for compiling transaction records from blockchain and exchange platforms, processing the data through formatted converters, and generating specialized tax reports.

Gordon Law sent cease and desist letters in December 2023 but claims McCormick and Founder’s CPA continued illegally utilizing its trade secrets. The complaint seeks damages and to bar the defendants from any further use or disclosure of Gordon Law’s confidential methods. It alleges violations of both the federal Defend Trade Secrets Act and the Illinois Trade Secrets Act.

The case provides an example of the complex legal issues surrounding the protection of valuable commercial information and intellectual property as industries like cryptocurrency taxation emerge and develop. The court will have to determine whether Gordon Law’s processes constitute protectable trade secrets and if the defendants improperly misappropriated them.

Please contact BlockTribune for access to a copy of this filing.