Lawsuit Over $2M Cryptocurrency Investment Takes Shape as Claims Narrowed by Court

News | June 24, 2024 By:

On Wednesday, June 12, 2024, the United States District Court for the District of Nevada issued an order in a case involving investments in a blockchain startup company and its digital currency operations.

Tetsuya Nakamura had sued Sunday Group Incorporated, SGI Trust, Toshiki (Todd) Mitsuishi, and James Pack alleging breach of contract, fraud, and other claims related to investments Nakamura had made in 2017 to acquire tokens for the company’s planned cryptocurrency called M-Tokens. Sunday Group and Mitsuishi then filed counterclaims against Nakamura for intentional interference with contracts and economic advantage, defamation, business disparagement, and civil conspiracy.

Sunday Group is a Nevada-based company developing a new blockchain network called Mobby Project and its associated cryptocurrency, Mobby tokens. In 2017, Nakamura invested $2 million to purchase 200 units of future M-Tokens from Sunday Group. However, the project faced delays due to changes in the blockchain industry and the COVID-19 pandemic.

Beginning in 2021, tensions arose. Nakamura and another investor began harassing and threatening Sunday Group, demanding returns of their investments. They contacted the company chairman and government regulators, making allegedly false claims about fraudulent activity, lack of compliance with securities laws, and misrepresentations about the project.

When the company did not pay, Nakamura filed a complaint with state regulators, providing a list of other investors he obtained without permission. He also disseminated documents containing allegedly defamatory statements about the company’s activities and representations to investors. Sunday Group alleges this disrupted their business.

The company counter-sued Nakamura, claiming he intentionally interfered with their investor contracts and economic prospects through threats, false complaints, and defamatory statements. At issue was whether the claims were sufficiently pled and not barred by the statute of limitations.

In its order, the court dismissed the abuse of process counterclaim without prejudice, as the parties agreed. It allowed defamation, business disparagement, and intentional interference claims to proceed, finding the allegations and timeline sufficient. However, it determined the intentional interference claim had not adequately shown Nakamura’s actions directly disrupted contracts. The parties will proceed with the remaining valid claims.

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