Marathon Digital Fined $135M for Breaching Non-Circumvention Agreement
Michael Ho Set to Receive $135M in Damages
The most dominant crypto mining firm by market cap, Marathon Digital, was fined $135 million earlier this week following a court verdict that showed the company breached a non-circumvention or non-disclosure agreement.
The complainant, Michael Ho, who is currently the Chief Strategy Officer of Bitcoin mining firm Hut 8 and the co-founder of Bitcoin Corp, managed to convince the judges through his lawyers that Marathon Digital breached a contract between them.
For starters, a non-circumvention agreement shields individuals or firms from parties that intend to bypass them in transactions.
Marathon Digital vs. Michael Ho
So, what led Michael Ho to file a lawsuit against Marathon Digital? According to his lawyers Affeld England and Johnson, Ho formulated a growth strategy for the mining company in 2020, including acquiring large-scale crypto mining facilities in the northern area of the United States.
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However, the lawyers told the court that Marathon Digital executed Ho’s strategy without paying him for the vital information he offered, thus breaching their non-circumvention contract.
Following the court verdict earlier this week, Ho’s lawyers released a statement saying that the outcome emphasized the need for businesses to honor their commitments to partners.
Meanwhile, Marathon Digital has announced its plans to challenge the jury verdict. In a statement, the Bitcoin mining company said it believed the court’s decision was wrong and that Marathon Digital did not breach any non-circumvention agreement.
According to the mining company, the awarded damages, worth $135 million, lack legal basis. Its spokesman told media outlet Decrypt that the firm would appeal the verdict soon.
Marathon Digital Retains the Top Position
Despite the current legal challenge, Marathon Digital is still the biggest crypto mining company in the world. According to data from CompaniesMarketCap, Marathon Digital has a market cap of $6.76 billion. It surpasses its closest rival, CleanSpark, by over 45%. The second-biggest mining company has a market cap of $4.12 billion.
As of this writing, Marathon Digital’s stock MARA is priced at $23.74, down 3.12% in the past 24 hours. However, its value is up 38% since the start of 2024.
In other news, Marathon Digital’s hash rate surged to 26.2 exahashes per second in July after the Ellendate mining facility became operational. According to the firm’s CEO, Fred Thiel, the increased hash rate has enabled them to mine 155 extra blocks.
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