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Canadian class-action lawsuit filed against Mt. Gox, Mizuho Bank

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[March 15, 2014]  By Amanda Becker

(Reuters)  A class-action lawsuit has been filed in Canada against Mt. Gox, the leading bitcoin exchange that lost more than $400 million of customers' digital currency, along with Mizuho Bank Ltd, one of Japan's largest lenders.

The lawsuit, filed Friday in the Ontario Superior Court of Justice, comes just days after Mt. Gox, based in Tokyo, filed for a U.S. Chapter 15 bankruptcy, which shields the company from lawsuits in U.S. courts.

The plaintiffs are Canadian residents who allege they are owed currency and the value of bitcoins by Mt. Gox that they have been unable to withdraw.

The lawsuit was filed on behalf of "all persons in Canada who paid a fee to Mt. Gox to buy, sell or otherwise trade bitcoins" and all those who had bitcoins or currently stored with Mt. Gox on February 7.

The filing alleges that a lengthy security breach at Mt. Gox resulted in "the pilfering of millions of dollars' worth of its' users' bitcoins."

On February 25 the website was shut down and users who had currency, including bitcoins, in Mt. Gox accounts could no longer access those funds. Approximately 750,000 of users' bitcoins were lost, the lawsuit states.

Mizuho Bank is named in the lawsuit because "all non-bitcoin currency received by the Mt. Gox Defendants from its users was held in an account or accounts" at the Japanese lending institution, the lawsuit said.

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The case is David Joyce, et al and MtGox Inc, et al, Ontario Superior Court of Justice, CV-15-500253-00CP.

(Additional reporting by Tom Hals in Wilmington, Delaware; editing by Lisa Shumaker)

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