A complaint filed over the weekend by Faes & Company (London) claims it paid more than half-a-million dollars for underperforming bitcoin miners and similarly poor hosting services from Chicago, Ill.-based defendant Blockware Solutions LLC. According to the suit, Blockware misrepresented its miners’ performance ability and lacked sufficient access to power to keep machines up and running.
The complaint explains that in October 2021, the parties entered into contracts for Faes to purchase $525,000 in bitcoin miners and related hosting services. Blockware also agreed to host Faes’ miners at one of the server facilities it allegedly owned and operated in exchange for monthly hosting and energy fees, the filing says.
Yet the machines allegedly arrived months later than expected and suffered from flaws that ran contrary to how they were advertised. In particular, the complaint says the miners were marketed as having industry-leading uptime, or the amount of time miners are actually mining bitcoin.
The filing also alleges that contrary to representations, Blockware did not actually own or operate a facility to host the miners and was not capable of doing so reliably. Purportedly the third-party facilities it used lacked reliable power, so the operation of the miners was and is regularly subject to interruption or “curtailment.”
Lastly, Blockware unilaterally increased its fees for the energy used to operate the miners, a change the defendant allegedly claims it had to make due to force majeure, namely a drastic increase in energy costs, the complaint says.
As a result of Blockware’s lapses, which the filing claims amount to breach of contract, negligence, and deceptive trade practices, Faes asserts that it “lost revenue from bitcoin mining, lost revenue from excessive downtime of its miners, excess energy fees, and loss of income from the cessation of operation of Faes’ miners.”
The filing claims a minimum of $250,000 in losses and seeks compensatory as well as punitive damages. The plaintiff is represented by Meador & Engle and Goodman Tovrov Hardy & Johnson LLC.
