Investors in the Marathon mining company filed a lawsuit against CEO Fred Thiel and nine other top executives for the illegal misappropriation of the firm’s assets for personal gain.
According to the filing, the executives are accused of violating the U.S. Securities Exchange Act, breaching fiduciary duties, unjust enrichment and misappropriation of corporate funds.
The plaintiffs also seek compensation from the top executives for actions that led to investigations with the U.S. Securities and Exchange Commission (SEC). The regulator is investigating whether the firm violated any provisions of federal securities laws at one of its facilities.
In November 2021, the miner already received a subpoena from the SEC. At that time, the agency demanded that the company provide documents relating to the same facility.
Shareholders did not seek a specific amount of damages, leaving that to the court’s discretion. The investors also call for governance changes to strengthen oversight of the board’s activities and nominate at least four of their own candidates.
According to the prosecutors’ lawyers, Marathon’s leadership downplays its problems and artificially inflates the company’s valuation, enabling excessive compensation and profitable insider sales.
In June, the cryptocurrency mining company mined 979 BTC. The figure fell 21% from May’s record, but was up 599% year on year.
Earlier, Marathon’s chief predicted an exodus of miners to offshore jurisdictions due to higher US taxes.