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Author Topic: Open letter to Hashfast in response to refund terms.  (Read 3116 times)
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dhenson
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December 30, 2013, 04:14:08 AM
 #1

This open letter is in response to your Shipment and Refund Letter (https://bitcointalk.org/index.php?topic=262052.msg4206282#msg4206282)  earlier today.

In the beginning, Hashfast convinced the entire community that they were the next evolution in ASIC manufaturers, being honest above-board and communicative.  In fact, it took quite a bit of convincing to get me to pull the trigger.  Having been burned previously I had initially decided not to order.  After many posts by Simon and John (via the Hashfast account), I slowly came around.  Full BTC refunds, the MPP program, imminent delivery (being on track to deliver at the end of October) all convinced me that my BTC was safe and that this would be the a solid investment.

Since then as we all know Hashfast has turned out to be a completely different company.  
  • You guys were never on track to deliver in October (not even close), effectively selling January equipment @ October prices.
  • You never actually intended to provide full refunds, as it turns out, that was a complete lie.
  • You repeatedly modified the TOS to the detriment of your customers. Most changes were done secretly without versioning and are now expecting customers who ordered in August to be bound by the modified terms.
  • John and I'm at this point convinced Eduardo, employed the use of shill accounts (iCEBREAKER, bitcoinermax and others) to badmouth competition and squash negative posts whenever directed towards your company.

So in response to your email I answer your 6 questions below:
  1) Batch 1 Order Number: 1460
  2) Product & Quantities: Babyjet x 2
  3) Full Name: *withheld*
  4) Shipping Address: *withheld*
  5) Method of Payment: Direct BTC transfer (http://blockchain.info/tx/b97e4a16ebf5e7da03a32e0c31fe04de69c29ddde689f2c03f0ccb5c67ae7075)
  6) Confirmation that I understand USD order totals that were originally paid with BTC can be refunded in BTC at the USD to BTC market exchange rate on the date of refund: NO I DO NOT CONFIRM

Hashfast is in clear violation of FTC guidelines regarding refunds (http://business.ftc.gov/documents/bus02-business-guide-mail-and-telephone-order-merchandise-rule).

I, pursuant to my rights as defined in the above linked guidelines demand a full BTC refund (89.27399159 btc) within 7 days of receipt of this request.

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dhenson
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December 30, 2013, 04:24:26 AM
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*Reserved for official Hashfast reply.*

lightlord
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December 30, 2013, 04:34:20 AM
 #3

Many have lost a lot, I myself spent 280 BTC on 5 hashfast units. And remember the earlier TOS that state full refund in BTC.
That of course been modified, I never expect to see those BTC back ever again  Undecided

And I remember the OCT 21-31 delivery dates, of course those are removed. Now its not even ready for shipping, at this rate
I won't be getting em to late Jan, and by the time I get em, each will make like 8 bitcents every 24 hours.

I thought it was in their memo to serve, and make sure their first batch customers are treated the best.
If they had any sense of mind, they could decdiate a bit of their company, to building tons and tons of hashfasts.
Point em all at a pool, and work towards mining back what they owe me. If they can't refund the 280 BTC.

At least they can build a ton more asics, and somehow make up for it. If they for example ship my 5 hashfast units at 2 TH.
And have 25 TH in the back mining for 6 months to my name, once all the BTC is payed out, then turn off those other 25TH.

As ASICS are a huge mark up, so they could in theory spend a lot less doing this method, instead of sending back 280 BTC at current market cost
or $230,000+. Maybe someone can email them about this idea, and perhaps something like that can be arranged.

And make some kind of threat, if they are not willing to help batch 1 in this way, or another, then we can all collaborate, gather all the evidence together.
And bring them to court, perhaps then they will talk more about this.

Just some ideas, but sadly I lost a lot.

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December 30, 2013, 05:08:05 AM
 #4

^^ Ouch

JJJJust
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December 30, 2013, 05:21:07 AM
 #5

If you read the actual text of 16 CFR 435 it says:

"(d) Refund shall mean:
(1) Where the buyer tendered full payment for the unshipped merchandise in the form of cash, check, or money order, a return of the amount tendered in the form of cash, check, or money order;

(2) Where there is a credit sale:
(i) And the seller is a creditor, a copy of a credit memorandum or the like or an account statement reflecting the removal or absence of any remaining charge incurred as a result of the sale from the buyer's account;
(ii) And a third party is the creditor, a copy of an appropriate credit memorandum or the like to the third party creditor which will remove the charge from the buyer's account or a statement from the seller acknowledging the cancellation of the order and representing that it has not taken any action regarding the order which will result in a charge to the buyer's account with the third party;
(iii) And the buyer tendered partial payment for the unshipped merchandise in the form of cash, check, or money order, a return of the amount tendered in the form of cash, check, or money order."

Bitcoins do not meet the definition of cash, check, or money order. (While they may be "money", "money" is not the same as "cash")

Compliance with the rule is not possible.
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December 30, 2013, 05:30:33 AM
 #6

The problem is actually finding a lawyer with the knowledge and desire to take on a case such as this.  I personally would be willing to pay up to 50% in lawyer fees to see Hashfast pay for their underhanded practices.

I'm sure others would as well.

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December 30, 2013, 05:33:05 AM
 #7

Quote
Just did the following calculation for the Baby Jet on Eligius. At 0.33 BTC per day, that is almost 7 Bitcoins in only 21 days. Exciting!

lol...we bought from a company that can't even accurately put numbers into a calculator, and obviously knows nothing about Bitcoin.  I really don't think any consumer protection laws apply in the Bitcoin space.  BFL, Avalon, bASIC, KNC...any legal action?  Chasing unicorns...

Losing hundreds of Bitcoins with the best scammers in the business - BFL, Avalon, KNC, HashFast.
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December 30, 2013, 05:34:27 AM
 #8

A very obtuse reading of the law.

The key part is that a refund is required.  Using FINCEN's guidance, Bitcoin is currency.  It is therefore reasonable to demand payment of the refund in the currency that was tendered.

There was a related ruling earlier this year where Coinlab's was ordered to deliver BTC as they had contracted rather than returning cash as they had tried to do.

Nothing is open and shut in Bitcoin at this stage.  But there is an argument on both sides.

Currency also does not equal cash. FinCEN also said that virtual currencies are NOT legal tender.

The Coinlab case is different as a contractual obligation is, and should be, enforced as written.
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December 30, 2013, 05:36:19 AM
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A very obtuse reading of the law.

The key part is that a refund is required.  Using FINCEN's guidance, Bitcoin is currency.  It is therefore reasonable to demand payment of the refund in the currency that was tendered.

There was a related ruling earlier this year where Coinlab's was ordered to deliver BTC as they had contracted rather than returning cash as they had tried to do.

Nothing is open and shut in Bitcoin at this stage.  But there is an argument on both sides.

Currency also does not equal cash. FinCEN also said that virtual currencies are NOT legal tender.

The Coinlab case is different as a contractual obligation is, and should be, enforced as written.

Batch 1 customers have a contract as well. 

I'm beginning to think you are just a troll.
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December 30, 2013, 05:42:40 AM
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Quote from: Entropy-uc
Batch 1 customers have a contract as well. 

I'm beginning to think you are just a troll.

My interest in what other people think of me is limited, and even less so when those thoughts are motivated by disagreement.

Troll or not, I am simply saying that, using the Mail Order Rule as the basis of demanding a BTC refund is not the strongest idea and that my assessment of the rule is that, when paid in BTC, such a refund need not be performed in the manner outlined by the rule.
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December 30, 2013, 05:44:03 AM
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Quote from: Entropy-uc
Batch 1 customers have a contract as well. 

I'm beginning to think you are just a troll.

My interest in what other people think of me is limited, and even less so when those thoughts are motivated by disagreement.

Troll or not, I am simply saying that, using the Mail Order Rule as the basis of demanding a BTC refund is not the strongest idea and that my assessment of the rule is that, when paid in BTC, such a refund need not be performed in the manner outlined by the rule.
He is using the mail order as a point in demanding the refund as its been more than enough time for them to deliver, the BTC refund is based on the contract of the terms of sale at the time of his purchase.

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December 30, 2013, 05:50:31 AM
 #12

A very obtuse reading of the law.

The key part is that a refund is required.  Using FINCEN's guidance, Bitcoin is currency.  It is therefore reasonable to demand payment of the refund in the currency that was tendered.

Not obtuse at all.

USD are legal tender for all debts public and private.

The Baby Jets were priced in USD and the delivery date was unknown but to be performed on best efforts basis and the future exchange rate of BTC is irrelevant to the contract unless there was a specific term that shifted it somehow like a put or call contract.

Consequently, the FinCEN guidance and your reasoning from it is also flawed. Additionally, just look to the UCC to see how foreign currency payments are treated (3-107 or 4-214).

If HF delivers Batch 1 Baby Jets in January then I think it will be very difficult to prove HF has not made best efforts relative to common industry practices to get the merchandise delivered.

I thought it was in the TOS that refunds were to be in USD at the price of the Baby Jets or in BTC at the amount paid and at the discretion of the customer so long as there were enough other people on the wait list so there would not be unsold Baby Jets. But I am not aware of any screenshots or prints of the TOS so that returns the BTC exchange rate issue to irrelevance.

Consequently, I think it will be very difficult to find an attorney to take this case and even more difficult to find one to take it on contingency because you will likely lose.

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December 30, 2013, 05:55:18 AM
 #13

Would public statements made by the CTO prior to sale effect this at all?

Now since the only payment option is in BTC Will I get the same ammount of BTC back should you fail to deliver by December 31st?

Orders are taken in BTC, in the unlikely event we get to refunds they will be given in BTC.


The USD addition to the TOS didn't happen until very recently.

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December 30, 2013, 06:20:51 AM
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I suppose my problem is that I had assumed that the court system would frown upon a company making statements prior to sale that conflict with their actions after.

In retrospect, I can see how that assumption was a bit naive.

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December 30, 2013, 06:48:46 AM
 #15

A very obtuse reading of the law.

The key part is that a refund is required.  Using FINCEN's guidance, Bitcoin is currency.  It is therefore reasonable to demand payment of the refund in the currency that was tendered.

There was a related ruling earlier this year where Coinlab's was ordered to deliver BTC as they had contracted rather than returning cash as they had tried to do.

Nothing is open and shut in Bitcoin at this stage.  But there is an argument on both sides.

Currency also does not equal cash. FinCEN also said that virtual currencies are NOT legal tender.

The Coinlab case is different as a contractual obligation is, and should be, enforced as written.

The fact that it currently might not be legal tender does NOT interrupt its EQUIVALENCE to currency!. Do listen to the director of FInCEN acknowledging Bitcoin status back in November irrespective of "tenderness":

"....A convertible virtual currency either has an equivalent value in real currency, or ACTS as a SUBSTITUTE for real currency. In other words, it IS a virtual currency that CAN be exchanged for REAL currency...."

In other words, we don't give a shit if it's "legal" tender or not. If HF is TAKING currency from us, for applicable refunds, HF needs to refund 100% of that currency to us.

Anyhow, leave that to a lawyer and let's not waste time believing we are lawyers.  

The People of The United States of America vs. Hashfast. Let the lawsuit begin!!

Can someone please post online a TEXT version of both the OLD email confirmation (with full refund text) and old TOS to show to judges the multiple violations HF is liable for?
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December 30, 2013, 06:55:25 AM
 #16


I thought it was in the TOS that refunds were to be in USD at the price of the Baby Jets or in BTC at the amount paid and at the discretion of the customer so long as there were enough other people on the wait list so there would not be unsold Baby Jets. But I am not aware of any screenshots or prints of the TOS so that returns the BTC exchange rate issue to irrelevance.

Consequently, I think it will be very difficult to find an attorney to take this case and even more difficult to find one to take it on contingency because you will likely lose.

Are you a HF shill??  You sound like having a loser mindset otherwise.. Anyhow, don't think. READ the TOS: NO USD exchange and no "subject to people wait list" bullshit either.
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December 30, 2013, 08:03:55 AM
 #17

You might start by sending a registered letter.  I don't see why you would expect them to even acknowledge your posting here.

I think you have a case based on the terms of sale I have seen posted, and the precedent of the ruling against Coinlabs requiring fulfillment in BTC.  But are you ready to file a suit to enforce your claim?

This is the single most important step.  IIRC the ToS stated that all official communication, post purchase, between customer and HF needs to be done in this capacity.

It's absolutely astonishing how many people either did not read the ToS they agreed to, or failed to have it reviewed by proper council.
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December 30, 2013, 02:57:47 PM
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A very obtuse reading of the law.

The key part is that a refund is required.  Using FINCEN's guidance, Bitcoin is currency.  It is therefore reasonable to demand payment of the refund in the currency that was tendered.

Not obtuse at all.

USD are legal tender for all debts public and private.

The Baby Jets were priced in USD and the delivery date was unknown but to be performed on best efforts basis and the future exchange rate of BTC is irrelevant to the contract unless there was a specific term that shifted it somehow like a put or call contract.

Consequently, the FinCEN guidance and your reasoning from it is also flawed. Additionally, just look to the UCC to see how foreign currency payments are treated (3-107 or 4-214).

If HF delivers Batch 1 Baby Jets in January then I think it will be very difficult to prove HF has not made best efforts relative to common industry practices to get the merchandise delivered.

I thought it was in the TOS that refunds were to be in USD at the price of the Baby Jets or in BTC at the amount paid and at the discretion of the customer so long as there were enough other people on the wait list so there would not be unsold Baby Jets. But I am not aware of any screenshots or prints of the TOS so that returns the BTC exchange rate issue to irrelevance.

Consequently, I think it will be very difficult to find an attorney to take this case and even more difficult to find one to take it on contingency because you will likely lose.

Wow... someone who actually understands the legal system and contract law on Bitcointalk... and posts?  It's a banner day here in Custom Hardware land!  Ya'll should listen to him, he apparently has a firm grasp on reality.


And you will honor your lost bets when?

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December 30, 2013, 05:33:20 PM
 #19


I thought it was in the TOS that refunds were to be in USD at the price of the Baby Jets or in BTC at the amount paid and at the discretion of the customer so long as there were enough other people on the wait list so there would not be unsold Baby Jets. But I am not aware of any screenshots or prints of the TOS so that returns the BTC exchange rate issue to irrelevance.

Consequently, I think it will be very difficult to find an attorney to take this case and even more difficult to find one to take it on contingency because you will likely lose.

Hey Sunnakar -

The USD exchange rate wasn't listed in the TOS at the time of sale... however my receipt had the following text on it.

Quote
Your order is expected to ship between October 20 and October 30, 2013.  Physical delivery of your order will take place within days, depending on the shipment method selected.  HashFast guarantees that all "Baby Jet" units from our first production batch will be delivered by December 31, 2013.  If Buyer ordered one or more Baby Jet units, and HashFast does not deliver such units by that date, then Buyer may at his or her discretion, cancel the undelivered portion and HashFast will issue a full refund the payment for the units that Buyer purchased but did not receive and cancelled.   This cancellation and refund is Buyer's sole and exclusive remedy for HashFast failing to deliver by the December 31, 2013 guaranteed delivery date.  Buyer must cancel the order and request a refund by January 15, 2014 to avail him or herself of this remedy. Buyer to pay all taxes, duties and shipping costs on units delivered.

"full refund the payment" ... the payment was a BTC payment.
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December 30, 2013, 06:44:46 PM
 #20

A very obtuse reading of the law.

The key part is that a refund is required.  Using FINCEN's guidance, Bitcoin is currency.  It is therefore reasonable to demand payment of the refund in the currency that was tendered.

Not obtuse at all.

USD are legal tender for all debts public and private.

The Baby Jets were priced in USD and the delivery date was unknown but to be performed on best efforts basis and the future exchange rate of BTC is irrelevant to the contract unless there was a specific term that shifted it somehow like a put or call contract.

Consequently, the FinCEN guidance and your reasoning from it is also flawed. Additionally, just look to the UCC to see how foreign currency payments are treated (3-107 or 4-214).

If HF delivers Batch 1 Baby Jets in January then I think it will be very difficult to prove HF has not made best efforts relative to common industry practices to get the merchandise delivered.

I thought it was in the TOS that refunds were to be in USD at the price of the Baby Jets or in BTC at the amount paid and at the discretion of the customer so long as there were enough other people on the wait list so there would not be unsold Baby Jets. But I am not aware of any screenshots or prints of the TOS so that returns the BTC exchange rate issue to irrelevance.

Consequently, I think it will be very difficult to find an attorney to take this case and even more difficult to find one to take it on contingency because you will likely lose.

Wow... someone who actually understands the legal system and contract law on Bitcointalk... and posts?  It's a banner day here in Custom Hardware land!  Ya'll should listen to him, he apparently has a firm grasp on reality.


Oh, really?? Are you a lawyer or have become an HF shill?? You seem to be equally clueless of any legal shit as well. Why don't you just go back to the hole from where you delayed products for 6 months and constantly misled people. That's probably a better "firm grasp on reality."
As I said before, "tender" o no "tender" shit does nothing from a currency validity standpoint per as the latest FinCEN guidance:

https://bitcointalk.org/index.php?topic=391375.msg4215273#msg4215273

This guidance was provided by the FinCEN a bit over "two weeks" ago, BTW if that magic time period resonates ;-)
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