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Author Topic: Butterflylabs Huge SCAM  (Read 383818 times)
Flying Hellfish
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July 25, 2013, 01:16:36 PM
 #2241

I thought the point was that BFL claimed capacity to deliver.  $, BTC, or any other form of payment should not be "cashed out" to be "spent", else the thing turns into a ponzi scheme and they can't pay everyone.

They are appealing to customers that don't exist yet at the expense of everyone else, using stupid excuses, (often the same excuse over and over), to "justify" the delay of shipment, with assertive self-righteous standing that they aren't responsible for your delay in satisfaction.  Do you guys remember when BFL were going into detail about how they were going to "future-proof" their asics?  What does that mean standing next to the notion that "BTC is gambling, our stuff could be garbage tomorrow, no refunds"?

Seriously, you maybe hashing right now...  But what you paid for was an experience to be had last year.  If that had happened, you would not be here trying to defend BFL, as well as yourself for settling for "kind of shitty".  You'd be out on the country side sharing the gospel of btc, with your fancy sportcar, meanwhile plunging money into stocks for infinite power engines.

Just saying...  A lot has changed, and the original product sold was not the product delivered, and for 98% that isn't even the case yet.
I'll grant you that.  But it doesn't make BFL a scam.  People were still able to get a refund  at any time if they weren't satisfied with BFL's progress.

Quote
Also, if you pay from another country, and your warranted a refund, the money you get back, is your own currency, and for the same amount.
The money you get back is your own currency, but NOT the same amount.  It is whatever amount makes up the same purchasing value at the time of purchase.  Someone who pre-ordered one of Tom's ASIC's (forgot what they were even called at this point) and paid with Euros on a credit card was actually refunded a slightly different amount, based on the latest exchange rate.  And it was a refund amount dictated by the credit card company, not by Tom, because it was a charge-back.

This just further proves the point that businesses generally consider the listed purchase price to be the price of the product, irrelevant of how other currencies might fluctuate against it.

It appears as though PayPal has a different policy and that they use conversion rate at time of purchase, so there is precedent for this type of refund.

Paypal currency conversion policy:
https://www.paypal.com/helpcenter/main.jsp;jsessionid=rV0JKsnTq3Z197277Pg2sQ4mJ1HJWQ5xpxnJnzGxvW9J1FhW03yL!-1588418?t=solutionTab&ft=homeTab&ps&solutionId=163394&locale=en_GB&_dyncharset=UTF-8&countrycode=GB&cmd=_help&serverInstance=9012
Refunds are performed using the exchange rate which was current at the time of the original payment.

I don't think paypal does this out of the kindness of their hearts, I wonder if it's a legal requirement and I would be curious to see an official credit card companies policy rather than your claim that is how CC companies work (I am by no means saying they don't do it, I would personally just like to see something from a CC company to have it validated).

This thread had a somewhat interesting derail on this topic.

https://bitcointalk.org/index.php?topic=236794.msg2542356#msg2542356

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July 25, 2013, 01:31:49 PM
 #2242

I'll agree that the prices were denominated in USD. 
That is not important at all. What is really important is what currency is mentioned on the commercial invoice. This is the official document that every court of law is considering if there is a litigation. There are two currencies on the BFL's invoice which means both are equally binding depending on the currency of the transaction. If you paid in BTC the currency of transaction is BTC. BFL is trying to convince me that transferring BTC to BFL I have actually purchased USD... No. If I wanted USD I'd have transfered my BTC to MtGox, not to BFL. On top of it, BFL has no right to exchange BTC into USD for their customers as they are not licensed as currency exchange.

Here it is the invoice:







my god, not you again. You even made your own thread a while back about this because you're butthurt. Please don't go on in this thread for pages about this issue. It's been talked about enough.

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July 25, 2013, 01:35:09 PM
 #2243

They assign a dollar value to whatever you contracted to receive, and that is what you get in the judgment.

quite frankly: A court could put quite a huge dollar value on the on time delivery of such a product. It'd probably be in the 10,000 $ range or more for a jalapeno (delivered October 2012) if you calculate it favorably?

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Chugaa
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July 25, 2013, 01:45:19 PM
 #2244

So is BFL a scam or not?  Huh
greenbtc
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July 25, 2013, 01:50:38 PM
 #2245

So is BFL a scam or not?  Huh

Yes, they are a scam. They refuse refunds, they are not shipping product. They take your money and do not give you anything in return.
jordaninthesky
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July 25, 2013, 01:52:26 PM
 #2246

So is BFL a scam or not?  Huh

Considering how much outcry there is, I would think you'd have everything you need to decide on whether or not if you want to invest with BFL.  I've personally been scammed by them.  So my answer is yes.  If they scam you or not, I guess that's between you and BFL.  Considering that 98% of the people who ordered last year have not received their order yet, it doesn't look favorable for anyone new to jump into the pit.
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July 25, 2013, 02:08:01 PM
 #2247

Has anyone verified if that have actually setup a legal company? Inc, LLC, Ect...?

Also what's the chances they are even paying taxes if most of their payments were in BTC?
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July 25, 2013, 02:33:03 PM
 #2248

my god, not you again.
Why not? Everything I've predicted is now a proven fact and now I'm not alone.

https://bitcointalk.org/index.php?topic=136615.0


You even made your own thread a while back about this
While back?! It was half a year ago. One of the mods locked the thread and changed the title to help BFL continue their blatant scam. By that time the only argument defending those crooks was that BFL is still refunding in USD. Now they have stopped all refunds! If that is not a scam it is beyond my understanding what a scam is?

I'm still awaiting an apology from forum mods!

https://bitcointalk.org/index.php?topic=137026.0
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July 25, 2013, 02:38:08 PM
 #2249

Quote
Also what's the chances they are even paying taxes if most of their payments were in BTC?

They were probably keeping track of the USD equivalent for tax purposes. Businesses with the amount of money they were getting from preorders would have to keep record of it, otherwise they'd get screwed by the tax man pretty quickly.

But then again who knows with the way they run their operation.
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July 25, 2013, 03:01:04 PM
 #2250

Quote
They were probably keeping track of the USD equivalent for tax purposes. Businesses with the amount of money they were getting from preorders would have to keep record of it, otherwise they'd get screwed by the tax man pretty quickly.

But then again who knows with the way they run their operation.

It would be funny to see BFL try to treat the IRS like its customers. Welcome to audit land.

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July 25, 2013, 04:02:12 PM
 #2251

Quote
They were probably keeping track of the USD equivalent for tax purposes. Businesses with the amount of money they were getting from preorders would have to keep record of it, otherwise they'd get screwed by the tax man pretty quickly.

But then again who knows with the way they run their operation.

It would be funny to see BFL try to treat the IRS like its customers. Welcome to audit land.

A person would have to be a retarded, incompetent, half wit bully, cock sucking dickhead to try and deal with the IRS like that...  I think a few of the BFL folks fit this description and so it's not a totally out of the realm scenario!!!!

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lucasjkr
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July 25, 2013, 05:09:09 PM
 #2252

Has anyone verified if that have actually setup a legal company? Inc, LLC, Ect...?

Also what's the chances they are even paying taxes if most of their payments were in BTC?

I was going to laugh at your first suggestion, but then I went to the Kansas division of corporation webpage and and found no listing for Butterfly Labs or Butterflylabs. Or course, they could have formed their corporation anywhere (Delaware and Nevada are popular locales) and I'm not going to search 50 states just because. But they should have registered themselves as a Foreign Corporation doing business in Kansas.  My own bet is that they are a legitimate company, just registered elsewhere and forgot to file as a foreign corporation, but who knows?

https://www.kansas.gov/bess/flow/main?execution=e2s3

I'd speculate that they're paying taxes based on the dollar value of their sales. There isn't any reason for them to hold Bitcoins, unless they want to accrue huge accounting expenses due to nearly all CPA's not having a clue about Bitcoins. But who knows? I'm a little surprised that they're not registered to do business in Kansas. Though I won't go as far as to call them a scam, since I already received my jalapeno (and sold it at a handsome profit on eBay). When they get to the end of their backlog, and assumedly announce higher hash rated chips, I'll be happy to order again. And since no one else will, the queue won't be nearly as long, hopefully.
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July 25, 2013, 05:48:43 PM
 #2253

They assign a dollar value to whatever you contracted to receive, and that is what you get in the judgment.

quite frankly: A court could put quite a huge dollar value on the on time delivery of such a product. It'd probably be in the 10,000 $ range or more for a jalapeno (delivered October 2012) if you calculate it favorably?

Yes, a court could find that, but they are unlikely simply to take your word for it that you would have made that amount of money.  That kind of what is called consequential damages would have to be established by expert testimony, because a judge is not going to be familiar with Bitcoin or Bitcoin mining and won't be able to make a ruling on it without expert testimony. 

Then BFL would be likely to come up with their own expert to say something self-serving. 

That would take a lot of billable hours.  You might be looking at well over $10,000 just to get that done.  So it probably wouldn't be worth it for one individual to try to do, but it might be worthwhile for a group of people, each with their own claims, to pursue.

Courts are also often reluctant to award consequential damages.  Specifically, the plaintiff has a higher burden of proof when attempting to characterize lost profits as compensable harm in a breach of contract case.  The plaintiff has to prove not only that the damages were reasonably certain to occur (this part is probably easy) but also was within the understanding of both parties, as well as proving the damages themselves to a reasonable degree of certainty.  Now, I think all these elements are present, but it can be tricky to prove them.

For instance, if BFL had just delivered YOUR unit, you would have made out like a bandit.  However, if they had delivered EVERYONE'S unit on time, the difficulty would have started to increase pretty rapidly, and the profit from each unit would begin to decrease more rapidly.  It could be tough to establish "reasonable degree of certainty" as to the amount of the damages considering the nature of the Bitcoin network.

There's also a detrimental reliance case.  I.e., you purchased a BFL because of their false representations, which they knew to be false, and you reasonably relied on their representations and were harmed.  In this case, you argue that had you not been snookered by BFL's lies, you would instead have purchased an alternate unit like an Avalon, and had you done that, you would have made $X in the interim.

There's also unjust enrichment.  With their false representations, they got to acquire tons of BTC which has since vastly appreciated in value.  It is unfair for them to be allowed to keep that ill-gained profit would be the argument.  If they converted to USD since then, presumably they've been collecting the interest on that money.  Basically, they got an interest-free loan and should have to pay prejudgment interest on it.

(Law school grad but not actively licensed in any jurisdiction, this is not legal advice, for real legal advice, seek licensed legal counsel in the appropriate jurisdiction, rinse, repeat.  This post is mostly off-the-cuff speculation about what a plaintiff might do, not a claim that any legal argument presented in it is necessarily likely to succeed.)
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July 25, 2013, 06:24:19 PM
 #2254

Decent PR?  
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July 25, 2013, 06:45:15 PM
 #2255

I just recently upgraded my miner purchase from BFL.
Don't worry, be happy. BFL are very generous. You'll be allowed to upgrade your purchase many times during next couple of years while they downgrade your bank account "at an unprepared snails pace".
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July 25, 2013, 07:20:44 PM
 #2256

I just recently upgraded my miner purchase from BFL. I don't mind BFL at the moment because they are at least sustaining decent pr with their shipping blog.
https://forums.butterflylabs.com/blogs/bfl_jody/
I'm just happy their still moving forward, at an unprepared snails pace but a pace none the less.

 You are obviously new here...
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July 25, 2013, 07:25:07 PM
 #2257

I just recently upgraded my miner purchase from BFL. I don't mind BFL at the moment because they are at least sustaining decent pr with their shipping blog.

https://forums.butterflylabs.com/blogs/bfl_jody/

I'm just happy their still moving forward, at an unprepared snails pace but a pace none the less.

Wow!  You recently gave BFL more money?   Unheard of!   
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July 25, 2013, 07:36:12 PM
 #2258

Glad I went KnC and never paid for my orders from these sandbagging morons!
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July 25, 2013, 07:40:58 PM
 #2259

It is amazing how much energy and money BFL crooks spend to create new sock puppets every day.
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July 25, 2013, 07:56:00 PM
 #2260

It is amazing how much energy and money BFL crooks spend to create new sock puppets every day.

I keep thinking there is a bug on my screen as I scroll past your posts..  =/   
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