Bitcoin Forum

The areas I know best are criminal law, tort law (personal injury/wrongful death/defamation/etc.), and business law.  

Shoot me an email at ncontendere AT gmail.com and provide me with as much detail as you think I need.  Make me an offer on what you think the answer/advice is worth based on how complicated it is.  Most of your questions I'll be able to answer right away.  Some might require research if it is a highly technical matter, and obviously I would ask for a little bit more for those issues.  

I am only knowledgeable about American law.  Sorry EU.  But make sure you tell me what state you are in, as the laws are very specific to each state.  This is especially important if your question is of a criminal nature.  

Hope to help as many of you as possible!

(continuing from the previous thread)


I don't believe that's quite an accurate assessment. AFAIK, for most of the PPTs, either there was no insurance and the risk and bearers of that risk were explicitly stated publicly in their terms, or else for the insured PPTs (at least those that made good on that insurance, and there were some), would not have been betting against their clients, since they would need to reserve money aside in unrelated assets in order to pay out. In short, just like any other insurance company, they were betting that they would NOT have to pay out (the only situation in which they would have made any extra money), ie that pirate would not default.

Also, many/most of the PPTs are not US based, which makes them much more difficult targets.

I do have a question, though. Assuming we do manage to force pirate and associates to cough up, either by returning what was stolen and/or by liquidating their property, is there a reasonable process that we could arrange a legal agreement for how those funds will be distributed before we get a ruling? I could only imagine a series of disasters following without such an agreement.

Excellent question.  The only way what you can achieve what you are asking for is if a class action lawsuit is filed.  A criminal undertaking by the Securities and Exchange Commission or the Justice Department would not allow for this result. 

Basically a class action lawsuit would be filed against pirate and whoever else.  At that point a lead or lead plaintiffs would be nominated, and the court would either grant or deny the Rule 23 Class Action lawsuit to proceed.  The lead plaintiffs are just the names on the lawsuit basically.  Now at any time the "plaintiffs" (all of the injured parties) could agree amongst themselves in the form of a contract as to how they will split any proceeds.  At this point it could really only be decided upon a percentage basis after legal fees and litigation cost, as no one knows how much there actually is left. 

There is no rule of ethics that would prevent this (there is an ethics rule that dictates the procedure the attorney must take in this agreement Model Rules of Professional Conduct 1.8(g)), and I cannot think of any contractual rule that would bar this type of contract.

Thanks! That clarifies things a lot. I had already figured that a % based agreement would be the only practical way to go about it. Do you have a ballpark figure of what we might be looking at in terms of total fees for a class action? Otherwise, would a criminal action cost us anything? I can see this possibly costing more than what we might stand to gain.

I'll be sure to send a BTC your way when I get the chance.

Attorneys fees range quite hugely depending on the case.  Class Actions of this type are pretty much only taken on a contingency fee basis.  The ethical rule for how much an attorney can charge only says that "the fee must be reasonable."  This is in light of all of the circumstances in the case.  Generally, a contingency fee of 33% is considered reasonable.  This may include the cost of the litigation (court costs, expert witnesses, etc.) or it may not.  That's negotiated between the clients and the attorney.  And then in a class action case, the court usually must approve the fee since it can be so large.  Now, in this case, I don't think anyone would claim that 33% is unreasonable.  This is an extremely novel case.  Never before been litigated.  It will require countless hours of time and research. 

But the good thing about a contingency fee case, is that there really isn't any downside for the plaintiffs if you lose, other than you lose.  You don't pay the attorney fee unless you win the case.  That's the very definition of a contingency fee. 

The bottom line is how much does pirate have left?  And I don't know how you find that out without hiring an attorney with expertise in securities fraud and doing some heavy duty investigation. 

A criminal action doesn't cost anything, but you can't bring that yourself.  Only a government employee such as a state district attorney/attorney general, or a U.S. Attorney.  The good thing about a criminal case is that the bad guy can go to jail.  The bad thing about a criminal case, is that it is not designed to compensate the victims.  The SEC tries in these cases to do that, but that just isn't the primary goal of the criminal prosecution. 

And any BTC tips are always appreciated.  I haven't posted an address yet in this thread, so here ya go.  Thanks again! :)  1Hu8aScogCkcphFVcR376y1T2mMdqiSd1r

I am curious why you did not discuss potential civil/criminal liability for selling insurance without a license, illegal wagering/bookmaking, selling securities without a license, and selling unregistered securities, especially in light of your experience with business law.

These seem like significant issues that X, Y, and Z would want to address, especially if their explanation for why they're not part of A's criminal enterprise is "We're just ordinary businessmen selling insurance/bookmaking/securities!"

Could you explain your understanding of the relationship between "conflict of laws" and criminal charges? I am only familiar with that term being used in a civil context.

Everything I said in my prior post was correct, I just didn't elaborate like I usually do.  Mostly because I qualified that response with  lol


As far as the securities issue, I discussed that in a prior post.  We're not even sure at this point if bitcoins are considered securities by the SEC under the Securities Act of 1933.  Also, this is such a novel area of the law, there could be other political factors at play out there that we simply aren't aware of.  The federal government could feel that intervention on behalf of the SEC to protect bitcoin investors might even "legitimize" bitcoins in the eyes of the public, and therefore they are refusing to classify them as securities for this very purpose.

Illegal wagering/bookmaking and selling insurance without a license are state law issues and are criminal offenses.  Every state is different, every jurisdiction has different penalties.  Sure they are being sold across state lines.  And that's where the whole federal enforcement can come into play.  Possibly they could be investigated for the racketeering charges I discussed in a prior post.  (Mail fraud, wire fraud, conspiracy, etc.)

Plus all of the above primarily deals with the criminal liability of a party.  It is the civil liability that I feel most investors that have lost out on would be interested in.  Sure there could be some civil action against them for breach of these criminal statutes as well, but I feel recovery would be pretty limited there for several reasons.  1) They likely have already disposed of the money and don't have significant enough assets to make it worth while to even sue them, except maybe as part of a larger plan to go after the big fish pirate.  2) Litigation would be extremely expensive.  Sure this could be classified as a Rule 23 Class Action lawsuit, but there would be so many plaintiffs and so little money, the attorney would be the only one that actually recovers any material amount.  3) Once again, you probably can't even sue a "bookmaker".  What theory are you going to sue them on?  You made an illegal bet and they didn't pay when you won?  That's the equivalent of suing a crack dealer, because he gave you substandard crack.  Courts will not enforce illegal contracts.

It seems you have some legal experience, so I think you'll be able to see where the PA Supreme Court was going in its analysis of criminal conflict of laws rule in Commonwealth v. Eichinger, 915 A.2d 1122 (2007):


Conflict of Laws rules are used in criminal contexts just like they are in civil.  Typically a substantive v. procedural issue.  But basically I was just pointing out in my prior post, that we have no idea how these conflicts might come into play.  We don't even know where these people are located and for that matter, exactly what they could be charged with anyway.  All I am able to do at this point is guess and theorize about what possible rights and remedies the players will all have.  But beyond that, in a criminal or civil context, we're likely dealing with international law as well. Treaties between the United States and whatever nation the would be defendant is in.  Can the US extradite him for a criminal case?  For a civil case, can a United States court assert personal jurisdiction over him?  Can the US court even seize any of his assets if they did?  Remember, in a civil context, a judgment without any assets to collect is only worth the paper it is written on.  Without assets to collect, why sue?  

What falls under illegal wagering/bookmaking?  Would Betsofbitco.in be in violation of it?  Would users of Betsofbitco.in be in violation of it?  If I write a post on the forum, telling people I will bet that Matthew won't pay anyone, and people take me up on it, does that make me in violation of it?

The answer is, it depends.  Betsofbitco.in, from what I can see, operates on the exact same model as the famous prediction market intrade.com.  

Intrade.com is base in Ireland.  It is legal under Ireland laws.  Intrade offers the following disclaimer:

.in is a domain name from India.  Pretty safe to say I have no clue on what the laws are in India.  It appears from a quick Google search though, that India is becoming more relaxed in their "gambling" laws.  So it may very well be legal in India.  

What may not be legal, is for you, an individual in another country, to use the site.  That would be up to your individual state/country.  

Back on the subject of defamation, what are the legal liabilities/responsibilities of the operator(s) of a website when someone who is not related to the operator(s) posts a defamatory message on their site (i.e. a forum)?

I certainly hope people appreciate the service your are providing Nolo. I have been keeping up on your posts and they have been very informative and accurate from what I can tell. Thanks for spending some of your free time answering these questions.

Great question.  Fortunately, to help us answer this question there is a huge amount of litigation over this exact issue regarding newspapers/libraries/television/etc. 

What you refer to are "republishers".

Here's the common law on republishers:
One who repeats, or republishes, a defamatory statement is liable to the same extent as the "primary" publisher.  Furthermore, the liability of the "primary" publisher may increase where republication is either intended by him or is reasonably foreseeable.  Those who disseminate material containing defamatory statements (i.e., "secondary" publishers such as libraries, bookstores, and magazine vendors) are subject to liability only if they knew or should have known of the defamatory character of the material. 

The part in bold is the applicable law to message boards such as this one.  Basically, your responsibility would be to take down posts immediately once you have knowledge of (or if a reasonable person under the same circumstances should have knowledge of) the fact that the post is not true.  If you do this simple step you should be pretty well protected from liability for defamation.  If the same person persists in posting defamatory information, then you might have a higher duty to take additional steps such as banning the individual. 

But there is also a law that Congress passed that specifically protects individuals that run such sites and internet service providers.  Under Section 230 of the Communications Decency Act, ISPs and website operators cannot be held liable for defamation for publishing statements that are were posted by someone else.

Hope this helps! 

Thank you! Happy to help!  :)

Absolutely! I've been looking for the answer to this question on and off for a few months, so thank you.

Does this mean that website operators do not have to remove defamatory statements even if they know it is defamatory?

I believe that's correct according to Zeran v. America Online, Inc. 129 F.3d 327 (4th Cir. 1997)

"[L]awsuits seeking to hold a service liable for its exercise of a publisher's traditional editorial functions – such as deciding whether to publish, withdraw, postpone or alter content – are barred. The purpose of this statutory immunity is not difficult to discern. Congress recognized the threat that tort-based lawsuits pose to freedom of speech in the new and burgeoning Internet medium.  Section 230 was enacted, in part, to maintain the robust nature of Internet communication."

This case is still good law, and the United States Supreme Court denied cert to hear the case. 

But doing what is legal, isn't necessarily doing what is "right".  So I still would advise clearly defamatory statements to be taken down, but it is not something a website operator should fear will lead to lawsuits. 

Sure, that makes sense.  I just had a case on a rating site of mine (not bitcoin feedback) where the business owner threatened to sue me if I didn't remove particular statements about her business.  I did some quick research, and told her why I could not be sued over it, and that shut her up, but I wanted to be sure I was in the right about that!

EDIT:  And to be clear, it was a "he said, she said" sort of thing... no way for me to know if it was false or defamatory or not.  I felt like it was prudent to keep the feedback posted, and offered the business owner the opportunity to respond to the accusations.

Sounds like you handled the issue appropriately then.  That's pretty much the same thing the Better Business Bureau does (although I'm not sure if the substance of their complaints become public, they just give the other side the opportunity to respond.)  Even without Section 230 you would only be liable for defamation if you knew or reasonably should have known the statement was false and defamatory.  So based on what you've told me you have absolutely no liability. 

Been a few days...just bumping the thread.  I'm kind of surprised all of my questions have been serious security law / civil law type questions.  I really thought most of them would be of a criminal nature around here ;) 

You don´t see the community spirit and, am afraid, don´t really want to be part of it.

Ciao

What does that even mean?

Well it was meant to be offensive apparently, but I didn't really understand it either lol.  No harm no foul I guess.

I think the criminal law is more cut-and-dry, so fewer questions about it.  People buying drugs on silk road know it is illegal - what questions would they have?  I am sure there are some, but I can't think of any myself at the moment.

People are more interested in questions regarding the economics and usage of Bitcoin itself... questions that haven't yet had the opportunity of being specifically answered in a courtroom yet.  I think that's why you get more of them based around security law / civil law instead of criminal law.

True.  I might be dealing with a slightly more intelligent crowd then I'm used to in my practice as well lol.  Typically the criminal questions I get are along the lines of "Yeah I did it, but what legal grounds can I use to get off."  That's mostly what I do in criminal cases.  Just poke holes in the prosecution's argument. 

The law surrounding bitcoin usage is definitely intriguing though.  It basically requires the application of hundred(s) year old law to cutting edge modern technological and security issues.  And you nailed it.  There is about 0 actual case law on the subject.  So I can't wait until someone actually brings some of these issues to trial. 

Haha, a higher class of criminal!

Here's a question for you:  What's your take on the legality of Bitcoin as a currency?  Could the US deem it illegal to use (even though they couldn't stop people from using it) as they did with other alternative currencies, like eGold and Liberty Dollars, etc?

Well as of right now, I see nothing illegal about the existence and use of bitcoins.  (It goes without saying that illegal acts can be engaged in with them, such as buying/selling on silkroad, using it as a way to launder other currencies, or failing to pay taxes on gains.  It is after all an asset.)  

The federal government may disagree with my analysis that I do not view anything illegal with the existence and use of bitcoins.  They clearly did with Liberty Dollars and would almost certainly attempt to make the same arguments against bitcoins if they chose to do so.  The problem is, that a bitcoin's very existence is so different in nature from that of a Liberty Dollar (which was usually an actual coin or printed paper currency).  Plus it was a whole lot easier for the feds to get to liberty dollars as they were primarily locally used and not as "virtual" as bitcoins.  The feds would not be able to disrupt bitcoins without substantial investment and effort.  

The more complicated question is could the US deem it illegal to use?  This goes into serious question of Constitutional Law.  Sure, the Congress could pass a bill that makes it illegal to trade something of value for bitcoins.  The President could then sign this bill, thus atleast temporarily making bitcoins illegal.  But, this law would (hopefully) be challenged in the courts.  This is when the real constitutional challenge would come into play.  Unfortunately, I just don't have the expertise in this area to give a full analysis of what the courts might do.  (And I'm not sure anyone does, to be honest since there is just so little precedent on the issue.)

The Securities and Exchange Commission already has a little bit of authority to make the transfer of bitcoins illegal, but as of yet, have failed to do so.  They could merely classify bitcoins as a security rather than a currency, and it would then fall squarely within their jurisdiction to regulate.  For example, they may require that only those with proper licenses could sell them.  This would almost certainly be challenged as well.

So the bottom line is: Are they illegal?  I don't think so, but the fed might.  If they are currently legal, then the government could make it illegal.  Would they?  I don't know.  Probably not until they consider it a competitive threat to the US Dollar.  If they did, would it survive a constitutional challenge?  I don't know and I don't think anyone fully does.    

Good answers, thanks for the insight Nolo.

I keep meaning to send you a tip, but forget every time I am at the computer actually holding my coins.  I will get to it someday though, I promise.  ;)

Lol if I had a BTC for every time a client has told me the check is in the mail  ;D

Hah, I bet!  Thing is, I hold myself to my word, and think it is despicable when others do not do the same.

I don't have a lot of money (certainly not compared to a lawyer's salary!) but I will give you a tip at least!

I'm just messing with you.  I appreciate your honesty.  All you have as a lawyer is your reputation.  Pretty much the same way online. 

What country are you from again? United States / America? How much different is law from there and the Philippines for example? We have courts, but we do not have juries. The cases are decided by a judge. You do not get tried by 12 peers because there are no jurors.

Sometimes, you get tried in public by media, and sometimes media seems to have an effect on the judge. Also, some judges have refused certain cases because of who it involves (like some big time corrupt government official who has the means to kill the judge, which is not an uncommon event here.)

Recently we impeached our Chief Justice and appointed a new one who should sit there for the next 18 years. Some cases get special courts which are judged by Senators (like the recent impeachment of the previous Chief Justice.)

I am particularly interested in self defense and justifiable homicide, in the event it happens, while hoping it will ever happen, at least to me. An opinion on your thoughts about the 2nd amendment would be appreciated.

I have read about cases where an entire jeep was robbed, but a good samaritan killed the robber while disappearing.

I'll be honestly harsh.  I believe it is very difficult to have a fair criminal trial without a jury.  That is such a fundamental principle of American justice, that I have an incredibly difficult time with the idea of not having one.  

I know nothing of the judicial system in the Philippines other than what you have just told me.  So I'll move on to your next couple of questions, self-defense, justifiable homicide, and the 2nd Amendment.  I believe that the 2nd Amendment is a civil liberty the drafters of the Bill of Rights found necessary.  But this doesn't mean that this right is inviolate, and cannot have restrictions placed on it.  Just as the 1st Amendment, has restrictions (the most frequently invoked example is "You can't yell fire in a crowded theater"), so does and can the 2nd Amendment.  Clearly the Drafters did not envision fully automatic assault weapons.  Is the government within its right to ban such weapons?  In my opinion, absolutely.  Can the government restrict ownership to those it deems fit to grant a license to?  In my opinion, absolutely.  Can the government ban all firearms?  In my opinion, absolutely not.  Not until the Constitution is amended anyway, and that isn't happening anytime soon.  Now on to justification defenses.    


Self-Defense
If a person has a reasonable belief that he is in imminent danger of unlawful bodily harm, he may use that amount of force which is reasonably necessary to prevent such harm, unless he is the aggressor.

An aggressor is one who strikes the first blow or commits a crime against the victim.  The aggressor can regain the right of self-defense in either of two ways:
1) upon complete withdrawal perceived by the other party; or
2) escalation of force by the victim of the initial aggression.

The majority view of the states is that there is no duty to retreat.  In jurisdictions that do follow a retreat rule, one need not retreat unless it can be done in complete safety, and retreat need not be made in one's home.

Defense of Others
A defendant is justified in defending another person with reasonable force only if he reasonably believes the victim had a right to use such force.  Some jurisdictions limit this defense to situations where a special relationship exists between the defendant and the victim, while other jurisdictions view the defendant as "standing in the shoes" of the person defended.

Defense of Property
Reasonable non-deadly force is justified in defending one's property from theft, destruction, or trespass where the defendant has a reasonable belief that hte property is in immeidate danger and no greater force than necessary is used.  Non-deadly force is also proper when used to re-enter real property or regain prossession of wrongfully taken personal property upon immediate pursuit.

Deadly force is that which threatens death or serious bodily harm.  Non-deadly force threatens only bodily harm.  

The use of non-deadly force is improper where a request to desist would suffice.  (Example:  "Put down my book now!"  If this would suffice, then the use of force is not allowed.  This is viewed from a reasonably prudent person standard.  What would a reasonable person believe under the circumstances?)

Deadly force may NEVER be used merely to defend property.  However, by virtue of other defenses (self-defense, defense of others), deadly force may be used where unlawful interference with property is accompanied by a threat of deadly force or where the defender reasonably believes an entry will be made or attempted in his home by one intending to commit a felony.  

Law Enforcement Defenses
Police:  A police officer may use that amount of non-deadly force that he reasonably believes necessary to effect a lawful arrest or prevent the escape of the arrestee.  Deadly force may not be used to arrest or prevent the escape of a misdemeanor offender.  A police officer may use deadly force to prevent the commission of a dangerous felony or to effectuate an arrest where it is reasoanbly believed the person has committed a felony and the force is reasonably necessary to effectuate the arrest.  

Private Citizen: A private citizen is privileged to use that amount of non-deadly force that reasonably appears necessary to prevent the commission of a felony or a misdemeanor amounting to a breach of the peace.  A private citizen may use non-deadly force to make an arrest if the crime was in fact committed and he reaosnably believes the person against whom he uses the force committed the crime.  A private citizen may use the same amount of deadly force as a police officer only if a dangerous felony is involved and the person against whom he used the force is actually guilty of the crime.  (In other words, really bad idea to try this.  Let the police do their job.  If you do it, and you make a mistake, you're going to jail.)

Resisting Unlawful Arrest
A defendant may use reasonable non-deadly force to resist an unlawful arrest.  An individual may only resist a lawful arrest by a police officer where the individual does not know that the other person is a police officer.  (Once again, just don't do it if you know it is a cop)

Necessity
Even deadly force is justified to avoid imminent injury resulting from natural forces or where an individual reasonably believes that his criminal conduct is necessary to avoid a "greater harm".  (For example, Mark kills Sam to save Jane and Jill.)  There is no defense of necessity where the defendant is at fault in creating the perilous situation.  


If this summary of the law of justification has been helpful for you, please feel free to contribute to: 15vdQBqJ3FrVWAnkPTAUERVaco2ozsn3Ss
I do quite a bit of pro bono work, and any extra I can earn online providing legal advice, allows me to spend more time during the day assisting and providing high quality legal services to the indigent and those that simply can't afford high priced attorneys.

The reason Liberty Dollars were illegal was because of their design. Specifically they had phrases and words on them that were too close to actual government currency, things like the use of the word "dollar" and "In God We Trust" and $ signs and busts of women that looked governmental, things like that. The guy that mints "physical bitcoins" could get into trouble if he made them look too similar to actual government coins.

There are lots of "local" currencies that don't use any of these phrases that are perfectly legal. Bitcoins, being virtual, don't even come close to having the same problems that Liberty Dollars did. Not only that, Liberty Dollars were part of a larger anti-government conspiracy. They were going to take down Liberty Dollars no matter what.

If the gov't wants to shut you down, they can find a reason. Silk Road might put a target on Bitcoin's back, but it seems more likely that they'd go after Silk Road first. Besides they can't shut down Bitcoins as it's widely distributed on an on international network basis. Even a trial ruling in the USA would have no jurisdiction outside the USA.

Agreed.  I think I said all of that.   ;D

If you guys had any idea how much you should have paid for all this OP has posted so far...

I think it's great of you to offer this advice, and do it basically free. But I don't really understand why you bother, since you cannot even redeem the goodwill, since you will have to stay anonymous since you are not allowed to give this advice here as an attorney....???

Anyways, carry on!

What bitcoin needs is a league of lawyers, just incase uncle sam gets a wild hare up his ass and decides go all out guns ablazin'. When the day comes, and it will, we will need a collection of legal representatives to go at bat for bitcoin, which the community could fund (and its for damn sure they will donate if they want their precious bitcoins to keep their value).

As for the talk of constitutionality, being a fellow U.S citizen we both know our government, with its all knowing unchallenged wisdom, has already shat all over our constitution time and time again. All it takes is the words "national security" or "funding terrorist organizations", or anything along those lines and the debate is over, the doors are closed, and the war begins.

I know... that's why I at least sent a tip his way!

Honestly, it'd be great to have a lawyer who was quite familiar with Bitcoins, and would be willing to defend/prosecute Bitcoin-related cases in court.  Not sure if that's something you're interested in Nolo, but "specializes in Bitcoin-related cases" might be a great thing to add to your or your employer's website.

I'm considering it.  In order to meet my ethical standards of "competency" I still feel I have a ways to go as far as education on the whole cryptocurrency type of transactions.  So don't want to go public until I feel fully qualified to handle those types of matters. 

But I am very grateful for the tip :)  Thank you! 

And thanks to everyone else for the kind words. 

Bump!!! :) 

I'm getting great questions from you guys in PMs.   Thanks again! 

Hi again,

Recently, the world may have noticed the Philippines again with its new Cybercrime law, and online libel. Have you looked into it, and what are your opinions? Almost everyone is very vocal about it, the penalty for online libel is very much higher than if you had mentioned it in print or traditional media (radio, TV.)

Of course, that's not stopping anonymous libel. (so easy to make a blog and it goes viral, and you stay anonymous, just don't be stupid.)

I obviously know very legal about the legal system in the Philippines and even less about the new Cybercrime law, so I decided to look it up.  Basically, it looks like a disaster.  Vast overreaching by the government.  It is almost blatantly obvious that it's real goal is to stifle speech, and not protect those that have been injured by false statements. 

I would hope that any attempt to pass something similar here in the U.S. would met with harsh criticism, and a Constitutional challenge. 

Nolo, still here ?
I'm familiar with two cases:
CryptoXChange (https://bitcointalk.org/index.php?topic=126724.0 )  - basically stopped services and severed communication - owners/company are Australian
bASIC ( https://bitcointalk.org/index.php?topic=143496.0;topicseen ) - ASIC mining device - project failed, pre-order money taken and not returned, communication  stopped In this case, BTCFPGA/Tom is American.

They're similar with the Trendon Shavers case, not a ponzi scheme, but in that a larger group of people are affected, and each is owed a smaller sum (probably not worth hiring a lawyer for). Together the damages are quite large, but people inflicted are from all over the globe, didn't know each other before and have a hard time putting a fight together.

Maybe we can build a 'how-to' for such cases, they seem to pop-up from time to time in the BTC industry, which is still pretty much not regulated.

Basically, from your experience, what should the people do in such a case ? What I'm thinking of ?
1. Which kind of actions are worth taking into consideration ? I'm thinking:
a) laywer/case
b) direct contact (parents ? e. g. Trendon family contact- https://bitcointalk.org/index.php?topic=109126.80 )
c) report to police
d) report to a regulatory institution (Money Laundering, Fair Trade, Finance  or something like this)
e) report to secret service
f) debt recovery agency (legal ways) - commission based

2. Which from 1. has the most chance to get your money back ?  Or what would be a top 3/5 ?

3. What would be the best first step / second step /third ?

Thanks,
Baboon

Good question.  I'll mostly address the bASIC issue, since I know the most about that issue, and the principal place of business is in the U.S.  WARNING: What I am describing below is a 30,000 feet overview of the process, and what most commonly happens. Do NOT assume that everything that has to be done is listed below. Seek counsel in your own state. 

First, with any type of lawsuit you have a statute of limitations you have to be aware of.  With bASIC you are primarily dealing with a breach of contract case.  Sure there are some possible tortious fraudulent activity out there, but most judges don't like when you try to confuse a breach of contract case with torts.  So let's assume we're suing under a breach of contract theory.  Each state is different, so you have to check with your own, but the majority of jurisdictions is 6 years.  So no hurry here. 

So now we want to file a lawsuit.  Where do we do it?  Most commonly if you were under $25,000 in pre-orders, your looking at small claims court or what is commonly referred to as "General Sessions" by many states.  (It is called something different in many states though.)  Some states limit you to $5,000, some states limit you to $15,000.  You just have to check with your state, and for that matter each county in a particular state might have a different limit.  To file the suit all you have to do is pay the court costs (typically around $150) and file your "complaint".  There are countless examples of complaints on the internet, but they typically do not have to be very detailed to be sufficient.  You will have to serve him though.  You'll have to pay someone in NY to do that for you. 

Do you need an attorney?  It's up to you, but most of you are probably intelligent enough to meet the basic filing requirements to get into court yourself.  Tom almost certainly isn't going to show up to defend his actions.  You'll get a default judgment against him.  Then you have to take that default judgment to NY and execute it there.  I would sue him personally and in the names of bitcoinasic.com and btcfpga.com.  Research needs to be done to see if those companies were ever incorporated.  But either way, if you sue him personally, and he doesn't defend, you'll get a personal judgment against him.  Take it to NY and have it executed.  You can file it with NY banks, and they will freeze his funds, and send them to you in the amount of the judgment.  Or you can have the sheriff actually show up at his house and start taking his stuff.  As far as executing it, no you don't personally have to go to NY to try to collect.  There are companies you can hire in NY to actually do that for you.  You just have to file the judgment with the NY courts. (They have to comply under the Full Faith & Credit Clause of the Constitution).

And for anyone wondering about suing Tom in federal court, you can't do it.  It would have to be in state court.  The only way to sue him in federal court, would be if he owed you over $75,000 in refunds and you were from a different state than NY. 

Don't call the police, they don't care.  This is a civil matter.
Don't harass his family.  They didn't screw you over, and worst case, you could get in trouble doing that.
Secret Service doesn't care. 
Debt collection will take any case for the right price, but I don't see them getting anywhere in this case.  If Tom can ignore all of you, he can ignore their phone calls and letters just as easily.
The only possible people I would report him to would be the US Attorney's Office for NY and the NY Attorney General's Office.  They might care enough to do something.  But even if they did that will NOT help you get your money back.  That will only cause them to prosecute him based on some type of criminal activity.  If they win you still get nothing.

(Like I said, I typed this out in 5 minutes.  I'm sure I missed something.  Don't rely on it.  It's just a general overview of what I would do.)

Anyone know of anyone around here who is an expert in similar topics as the OP but is familiar with EU law?

I'm an American attorney (like NOLO) who is quite knowledgeable on Securities regulations and understand the cryptocurrencies. Knew to this site but been watching BTC and other since the inception. Also licensed in Ireland, so understand EU directives and policies. I can try to answer EU questions to the best of my knowledge or research them if needed and provide a general overview  (if needed) of US ones to supplement NOLO (who has been spot on for 5 min summaries so far). I don't want to overstep, so I'll let NOLO keep up on the US aspect unless i need to chime in with something additional.