Coinbase sued for patent infringement of cryptocurrency transfer technology

Taken on March 4, 2022, this illustration shows a cryptocurrency representation in front of the Coinbase logo. REUTERS/Dado Ruvic/Illustration/File Photo

Reuters We are facing patent litigation.

The lawsuit filed Thursday in Delaware federal court by Veritaseum Capital LLC alleges that Coinbase infringed a patent granted to Veritaseum founder Reggie Middleton by the US Patent and Trademark Office last December.

Veritaseum Capital has accused several Coinbase services of infringing patents, including its blockchain infrastructure for validating transactions. In court he sought at least $350 million in damages.

Coinbase, one of the world’s largest platforms for trading cryptocurrencies, did not immediately respond to a request for comment on Friday.

Veritaseum previously issued the token VERI. In 2019, Middleton and his two Veritaseum entities filed for U.S. securities, including a $1 million fine against Middleton himself, to settle accusations of a “fraud scheme” for selling tokens in 2017 and 2018. Paid over $9.4 million to the Trade Commission.

The SEC, among other things, has accused them of misleading investors about demand for the token and manipulating its price. They agreed to a settlement without denying or admitting the underlying accusations.

Middleton and Veritaseum told Brooklyn federal court in early 2019 that they had not made any fraudulent allegations, saying that the tokens were not securities and that the transaction in question was “in fact, Mr. Middleton is a new online cryptocurrency exchange. It was an effort to test the .”

Veritaseum’s website says it is “building a blockchain-based peer-to-peer capital market as software at global scale.” Thursday’s lawsuit alleges that Coinbase’s features, including its website, mobile app, Coinbase’s cloud, pay and wallet services, infringe a patent on how to securely process digital currency transactions. ing.

Veritaseum Capital attorney Carl Brundidge of Brundidge Stanger said Friday that Coinbase was “uncooperative” when it tried to settle out of court.

Middleton and Veritaseum separately sued T-Mobile in 2020, claiming that hackers stole $8.7 million in cryptocurrency due to the telecommunications company’s security deficiencies. T-Mobile disputed the allegations, and the lawsuit was arbitrated by him in August.

The case is Veritaseum Capital LLC v. Coinbase Global Inc, United States District Court for the District of Delaware, No. 1:22-cv-01253.

For Veritaseum: Carl Brundidge and David Moore of Brundidge & Stanger

For Coinbase: Not Available

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