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    Home » Crypto News » Bitcoin-Friendly Retailer Overstock Moves To Dismiss Lawsuit Ahead Of Token Distribution

    Bitcoin-Friendly Retailer Overstock Moves To Dismiss Lawsuit Ahead Of Token Distribution

    Author: George Georgiev

    Last Updated Jun 24, 2020 @ 13:22

    Global retailer Overstock has filed for a dismissal of a lawsuit that alleges the company is misrepresenting a “digital dividend” token to its shareholders.

    Accused On Misleading Information To Shareholders

    The online retailer Overstock has been among the firms that adopted and advocated Bitcoin early on. Now the company is caught in a legal battle, accused of spreading misleading information in representing the essence of its new digital token to its shareholders.

    The so-called OSTKO security tokens were supposed to be released on May 19 and ought to be distributed between shareholders, respectively, one token for every ten company shares.

    Now, however, there’s an accusation that the announcement has caused a serious price outburst because Overstock has allegedly withheld information about the distribution.

    Rejecting The Accusations

    The company argues that The Mangrove Partners Master Fund is rather a “well-known short seller” than an institutional investor. Overstock claims that there is no misleading or misrepresented information on the nature of the Dividend they offer or any intentional plan to hide the impact it could’ve had on the market.

    ADVERTISEMENT

    The company adds that this influence was specified from “day one,” using it as the main reason for the lawsuit dismissal.

    Violating Securities Laws

    Overstock is also being accused of violating securities laws. The reason – last year’s unexpected departure of ex-CEO and founder Patrick Byrne from the company, and the subsequent liquidation of 20% of his Overstock shares for that matter. These allegations also concern former CFO Gregory Iverson and current retail president David Nielson.

    It claims that Overstock has released misleading data and year-end predictions on the profitability of its security token exchange tZERO to boost the price of OSTK shares, helping ex-CEO Byrne to walk away with a considerable premium.

    Overstock has been a well-known Bitcoin proponent for quite some time. In fact, it not only accepts BTC as a payment method but also paid some of its Ohio state business taxes using Bitcoin through the state’s cryptocurrency taxpayer platform.

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    About The Author

    George Georgiev
    More posts by this author

    Georgi Georgiev is CryptoPotato's editor-in-chief and a seasoned writer with over four years of experience writing about blockchain and cryptocurrencies. Georgi's passion for Bitcoin and cryptocurrencies bloomed in late 2016 and he hasn't looked back since. Crypto’s technological and economic implications are what interest him most, and he has one eye turned to the market whenever he’s not sleeping. Contact George: LinkedIn

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