January 9, 2023 – New York, New York
Last week, Charles Hall, an investor with Reggie Middleton and a shareholder in Veritaseum, Inc., secured a decision from the Supreme Court of the State of New York, New York County holding that Reggie Middleton breached his fiduciary duties to Mr. Hall and other shareholders and stole valuable patents relating to Devices, Systems and Methods for Facilitating Low Trust and Zero Trust Value Transfers that can be implemented utilizing cryptocurrencies and blockchain technology. The Court found that:
“Reggie Middleton wrongfully caused patents belonging to Veritaseum, Inc. to be transferred to and owned by himself personally in breach of his fiduciary duty of loyalty to the Company.”
The Court ruled in a six-page decision (attached) that Veritaseum, Inc. submitted a number of patent applications, and that based upon these filings, Middleton raised money from individual investors, including Mr. Hall, for which he granted them a share in the Company. According to the decision, Middleton then attempted to steal the patents, which were the Company’s primary assets, and keep them separate and apart from the Company. The Court further found that the Company was “at one point extremely valuable,” but that Middleton’s actions, including “misappropriation of the patents,” rendered “the Company worthless.”
The Court further found that:
“Middleton claimed that there is no need for trust in cryptocurrency transactions because they are ‘unbreakable promises’. While that may be true on the blockchain, there is a tremendous need for trust and fidelity among fiduciaries. Where, as here, that trust is flagrantly violated, there must be real, meaningful consequences to ensure that it doesn’t happen again.”
In ruling against Middleton, and in order to dissuade him from future “violations of bedrock corporate law” Justice Schecter ruled that Middleton pay $1 million in punitive damages and that he pay Mr. Hall’s costs and legal fees.
Charles Hall is represented by Jon R. Grabowski, Edward M. Pinter, and Janine A. Balzofiore of Ford Marrin Esposito Witmeyer & Gleser, L.L.P and Troy Froderman of FR Law Group PLLC. You may contact Jon R. Grabowski (firstname.lastname@example.org) if you have any questions.