Bitcoin Forum

Question of the day:  Who's going to head the lawsuit against BFL?


[Disclaimer:  I am not a lawyer; what is presented below was done quickly and hastily. Any and all following statues of law may or may not be applicable.]

Motivation:

https://bitcointalk.org/index.php?topic=88363.0 (https://bitcointalk.org/index.php?topic=88363.0)
https://bitcointalk.org/index.php?topic=88365.0 (https://bitcointalk.org/index.php?topic=88365.0)
https://bitcointalk.org/index.php?topic=88304.0 (https://bitcointalk.org/index.php?topic=88304.0)
https://bitcointalk.org/index.php?topic=76916.0 (https://bitcointalk.org/index.php?topic=76916.0)
https://bitcointalk.org/index.php?topic=77796.0 (https://bitcointalk.org/index.php?topic=77796.0)
http://news.yahoo.com/butterfly-labs-announces-next-generation-asic-lineup-054626776.html (http://news.yahoo.com/butterfly-labs-announces-next-generation-asic-lineup-054626776.html)

Considerations:

Pursuant to: Federal Trade Commission Act:  15 U.S.C. § 45 Section: (A)(1) – Unfair Methods of Competition

http://www.law.cornell.edu/uscode/text/15/45 (http://www.law.cornell.edu/uscode/text/15/45)

In response to allegations of using second-hand hardware.

http://law.findlaw.com/state-laws/deceptive-trade-practices/missouri/ (http://law.findlaw.com/state-laws/deceptive-trade-practices/missouri/)

Missouri has not adopted the Uniform Deceptive Trade Practices Act.  This act discretely: Represents that goods are original or new if they are deteriorated, altered, reconditioned, reclaimed, used, or second-hand.

See: Uniform Deceptive Trade Act (Source: Unavailable)


In response to allegations of upcoming ASICs

Pursuant to the State of Missouri's Satute Chp: 570:

http://www.moga.mo.gov/STATUTES/C570.HTM

• 570.160. 1. A person commits the crime of false advertising if, in connection with the promotion of the sale of, or to increase the consumption of, property or services, he recklessly makes or causes to be made a false or misleading statement in any advertisement addressed to the public or to a substantial number of persons.
• 570.170.1 - A person commits the crime of bait advertising if he advertises in any manner the sale of property or services with the purpose not to sell or provide the property or services: (3) At all.

Pursuant to the State of Missouri’s Merchandising Practices Act §407.020, §407.145 15 - CSR 60-7.040

http://ago.mo.gov/publications/advertisingrules.pdf

• (1) A seller shall not make a claim with respect to a product’s performance in an advertisement unless the seller has in its possession information sufficient to form a reasonable belief that the claim, in fact, is true. A seller may rely on reasonable performance claims supplied by the manufacturer or supplier of the product.

Pursuant to Missouri’s Merchandising Practices Act §407.020, §407.145, §570.160 – 15 CSR 60-7.020

• (1) A seller shall not: make a representation or statement of fact in an advertisement that is false or has the capacity to mislead prospective purchasers.

In response to allegations of grossly inaccurate shipping times:

Pursuant to Missouri’s Merchandising Practices Act §407.020, §407.145, §570.160 – 15 CSR 60-7.020

http://ago.mo.gov/publications/advertisingrules.pdf

• (1)(B) – A seller shall not advertise any product unless the seller has that product in stock or available for sale in sufficient quantities to meet reasonably anticipated customer demand during the effective period of the advertisement.
• (2)(C) – A seller shall not: refuse to … deliver it [product] within a reasonable time frame.

In Response to the required (full) payment up front and grossly inaccurate shipping/lead times:

Pursuant to the Federal Trade Commissions Merchandise Rule - §435.2

http://business.ftc.gov/documents/bus02-business-guide-mail-and-telephone-order-merchandise-rule#rule

**The relevant portions are long, for sake of brevity I have summarized them in my own words**

• (a)(1)(i) - Covers the reasonable basis of the seller accepting payment with intent to ship in a prescribed time.
• (a)(2) - Covers the requirement of a seller to notify the buyer of any (known) delay in shipping.
• (a)(3)(i)(ii) - Covers the seller being unable to make any representation regarding length of delay.
• (b)(1)(i) - Covers the sellers inability to ship while failing to inform the buyer clearly and conspicuously without prior demand

EDIT:  I may have recalled their operating state incorrectly, I am revising this post.

Obviously not you, since you don't have the balls to come up with some proof. Secondhand, my ass.

NO SHIT SHERLOCK.

http://dictionary.reference.com/browse/allegation?s=t (http://dictionary.reference.com/browse/allegation?s=t)

allegation
noun

• 1. the act of alleging;  affirmation.
• 2. an assertion made with little or no proof
• 3. an assertion made by a party in a legal proceeding, which the party then undertakes to prove
• 4. a statement offered as a plea, excuse, or justification.

"balls to come up with some proof."  What kind of retarded statement is that anyways?  I personally don't believe they're utilizing second hand chips.  However, that's just my assumption, be it correct or not. That's why it's an allegation genius. Furthermore, it's not beyond the realm of reality. 

Example: http://www.nytimes.com/1995/07/15/business/packard-bell-settles-class-action-suit.html (http://www.nytimes.com/1995/07/15/business/packard-bell-settles-class-action-suit.html)

Do you know that they are not located in the State of Kansas :-). You obviously did lot of research, didn't you.

See the disclaimer.  I recalled the questionable business license being issued in Kansas.  I'll verify and revise.  Thanks for the heads-up.

So do tell me, why would anyone start an expensive lawsuit over what are nothing more than allegations?

You realize that every lawsuit starts on the basis of allegations, right?  You then (hopefully) procure the evidence to support or deny the allegations proving or disproving them as fact.  It's a colloquial statement, but to entertain you: Something like what BFL is doing could potentially ruin an otherwise successful business.  Does it even matter? Stereotypically Americans (which I'm not) love to sue.  I'd think this doesn't need any explanation.

God damn there are a lot of ignorant trolls on this forum. BFL is a far better company than what you morons give them credit for. I don't see any other companies out there that have shipped the amount of FPGA boards they have, designed their own BTC mining software to use w/ them or come out with anything remotely close to the mini rigs or singles at anywhere near the price that they are letting them go for. Keep talking shyt and once again BFL will pull your foot out of your mouths for you.

Ztex has shipped a fair amount of boards by now..... and there are other competitors in the field (Modminer; Icarus; X6500; enter point; bitforce; etc)

But why a lawsuit against them?

If u don't have any of their products nor waiting on them ....?

Class action law suit coming on because yeah Americans love to sue because where's there's blame there's a claim  ;)

I think there are much more serious violations in the area of securities law.

Taking 100% deposits on products you know you won't deliver on your promised schedule doesn't seem to be proscribed under US consumer laws.  At least not in an obvious way that I can find.

But selling things before you invent them likely runs into the domain of securities regulations rather than simple consumer law.

I'm not crazy enough to let a dime of my money flow into their hands so I can't be bothered to dig through the relevant materials.  If I was one of their competitors, I would spend some time on the phone with a few lawyers in their state capital.  $2000 placed with the right man would probably put them completely out of business.

Enterpoint : doooooooooo it !
 :D

This bullshit FUD is in the wrong section anyways. Move it to Legal.

It's intended to be a topic of discussion more than action, however in an ideal world having this all spelled out may motivate BFL to get their shit together.  I would have sat idly by, but after the trolling of Enterpoint, and the confirmation (note: hearsay), that the ASIC announcement was nothing more than a malicious attempt at stealing business from their competitors perturbed me a bit.

Wouldn't that be something?  As far as my understanding goes though, this wouldn't classify for a class-action.

You raise a good point.  Much of what I've read/posted are merely misdemeanor offences, although it seems as there is a line in the sand between that and class D felony dependant on the amount of money in question.

I hear what you're saying, I think there's a lot of grey area when approaching it from a securities stand-point, especially in the determination as to whether the product design exists, or whether it's vapourware.  In fact, I think there's a section of law that deals with 'inventor-for-hire' type cases. 

Fair enough.  Conversely, I actually have a couple of their singles, but I'm sure-as-shit not going to buy any more at this point.  Realistically, the arrogance and total disrespect for their clients is what drove me to wasting my time on this.  I have no intention of starting a literal law suit, but maybe having an open discussion about the actual legalities of their business practice might ensure that those who have entrusted their money with BFL aren't dicked around any more.

My my, aren't your panties in a bunch.  Don't you have some pictures of wires you miraculously managed to bend into 90' angles you should be posting?   ;)

Friendly jabs aside, you're right and I've PM'd DiabloD3 to try and get this relocated.  Thanks for bringing the legal sub-forum to my attention.

You are able to move it yourself with the link at the bottom of the page. If you move it there, you won't have to hear from me again since I don't look at that section ever.

I don't know if I would classify it as FUD.  BFL is clearly walking a thin line in regard to consumer protection/trade law.

ignore rjk, he just trolls for BFL.

Ignore mem, he is retarded, just like galambo. Are they the same person?

Oh! It just so happens that I know the law you're looking for  ;)
http://business.ftc.gov/documents/bus02-business-guide-mail-and-telephone-order-merchandise-rule


Thanks for jogging my memory :)

must be hard defending a company like BFL when they constantly come off as lying dicks who have no respect for their clients and troll other respectable manufacturers.
Have fun seeing it through to the bitter end.

Please do not move this to legal, the BFL shills want this buried for the obvious reasons.

IMO, I think they are.  Thanks for directing me to the 'move' link.

In case you haven't bothered to read what I've been writing for the past dozens of posts, I will repeat here that I am not at all impressed or infatuated by them or their business ethics. I however know a good product when I see it, and I find no reason to detract from the product itself. I have been bashing them as hard as anyone in regards to the abysmal business conduct, even going as far as to troll a competitor's thread.

However, legal action on questionable principles is going to do nothing more than put an innovative company out of business for no really good reason. We know what to expect from them now, and we know that there is nothing to fear any time soon. Can you say biting the hand that feeds you? Making a device that is faster than any GPU on the market, yet cheaper than most of them will result in widespread adoption like never before, which in turn leads to decentralization like never before, when many users have some small hash instead of some users having small hash and others having far more.

In case you have not noticed, they are my sockies :-*

I think taking peoples money for over three months before delivering a product is bad for consumers although I don't know if it is illegal if they told you the lead times.  That recent announcement they made is really bad for competitors tho and I don't think they can live up to it.  I just hope OpenBitASIC or Enterpoint can blow them out of the water with an actual product, price and delivery.   

But is there any relevant law they are violating in that space?  I recall restrictions against taking full deposits on goods ahead of manufacturing in Canada, but there doesn't seem to be anything specific in the US.  All I see is requirements for written notice of the right to a refund after 60 days without delivery.

Jesus....Whatever happened to THIS promise ?

2 posts after the fact and here we are with your next little ditty.... ;)


Small hash vs more hash. I like more hash personally...LOL

Rubbish and pointless thread, lock it and let it die.

This thread=bullshit and wasted bytes

The dinosaurs fearing the ASICs, so much fail.

Just like Singles and Mini Rig were never delivered and don't exist?  ::)

There are still a good number of $600 ~850MH singles still not in customer hands. Meanwhile they are taking money for $149 ~3500MH units that DO NOT exist yet...

This seems perfectly normal to you?


edit; when they started taking money for singles they atleast had a prototype or 2 they were working with. No one has seen anything but claims from the current offerings.

They are definitely, flagrantly violating FTC rules as seen here.

http://business.ftc.gov/documents/bus02-business-guide-mail-and-telephone-order-merchandise-rule (http://business.ftc.gov/documents/bus02-business-guide-mail-and-telephone-order-merchandise-rule)

I still can't find anything about selling products that haven't been designed yet.  

Failing to conform to these rules looks expensive.    ;)


https://www.ftccomplaintassistant.gov/ (https://www.ftccomplaintassistant.gov/)

Nobody cares.

Funny world we live in ... government never respects the law ... they are above it !

I think any legal action would hurt the Bitcoing mining community the most (the customers) as it will simply create further delays and in worst case the company could liquidate without the members of the mining community getting their refund.

The weirdest and most shadiest part of this all is that BFL only put there policies and terms on the forums and not on there website.
I pmed, and they just stated there policy again instead of pointing me to this statement on there website or explaining why it's not on there website.
See: https://bitcointalk.org/index.php?topic=90350.0
and don't let it die.

Note: That they can state as much as they want on this forum.
You cannot rely on the statements they make on the forums. And if shit does hits the fan, stuff they state on the forums like:
"We will give a full refund when we fail to perform" will not be valid in some future lawsuit.

I hope you guys realize that.

Edit: You also don't have to agree to any terms and conditions when purchasing something.
I don't get why people spend thousands of dollars without knowing what there rights are and what they deserve when shit goes wrong and they actually do fail to deliver or whatever.
And since they are not really fast with there customer support you may have to wait months before you get shit done without being able to appeal to anything.

Thanks for this. Reading through this link (http://business.ftc.gov/documents/bus02-business-guide-mail-and-telephone-order-merchandise-rule), it appears that BFL must cancel the order before they ship if a customer requests it. 


In their FAQ, BFL's policy on pre-orders states:


I wonder what takes precedence in this case.

And you read correctly sir...or at least that's what I gathered from the reading too haha.

Given what is still going on I wonder what your take on all this is now Grouver?