Coinbase – the largest cryptocurrency exchange in the United States – has been slapped with another multi-million dollar lawsuit.
The company has been accused of patent infringement through several of its services, over which the plaintiff is seeking $350 million in damages.
Another Coinbase Lawsuit
Veritaseum Capital LLC filed the lawsuit on Thursday in a Delaware court.
The firm claims that Coinbase has infringed a patent awarded to the company’s founder Reggie Middleton in December by the U.S. Patent and Trademark Office. The patent surrounded a technology facilitating low-trust peer-to-peer value transfer “conditioned on input from or participation of a third party.”
The filing said Coinbase violated Middleton’s intellectual property rights by infringing the patent’s claims through multiple services on Coinbase’s site. These include Coinbase Cloud, Coinbase Pay, Coinbase Wallet, Delegate and Validator software, and other technologies.
Coinbase was apparently “uncooperative” with Veritasium when the latter attempted to settle the matter outside of court, according to attorney Carl Brundidge of Brundidge Stanger.
“Defendant makes, uses, sells and/or supports infringing products and services on the Bitcoin, Bitcoin Cash, Litecoin, Ethereum and Solana platforms as well as NFTs for its products and offerings that run on top of and facilitate said platforms,” the filing continues.
As such, the lawsuit seeks to award Veritaseum $350,000,000 in damages, due to the “substantial profits” Coinbase has reaped through its alleged infringement, and the “irreparable harm” it continues dealing to Veritaseum.
Veritaseum, according to its website, “builds blockchain-based, peer-to-peer capital markets as software on a global scale.”
Common Ground: History With the SEC
While opponents in this case, both Coinbase and Veritasium share something in common besides their technologies (allegedly): a history of securities disputes with the Securities and Exchange Commission (SEC).
In 2019, Middleton and two of his Veritasium entities paid over $9 million to the SEC to settle charges for selling a crypto token called VERI in 2017 and 2018. The SEC accused the company of manipulating the token’s price, and misleading investors about information surrounding potential gains.
Similarly, Coinbase was sued by the commission in July for allegedly listing unregistered securities on its platform. Coinbase claims that the items in question are not securities.