How to put Mt. Gox into involuntary bankruptcy in Japan.

[Nagle]

Here is a guide to bankruptcy in Japan, from Japan's largest law firm, Nishimura & Asahi:

IV. Liquidation under Bankruptcy Code

A. Commencement of Proceedings

An application can be made if (i) the debtor is unable to pay its debts generally or (ii) the liability of the debtor exceeds the value of the assets of debtor. Suspension of payment by the debtor shall be considered that the debtor is unable to pay its debts generally. An application for bankruptcy proceedings can be made not only by the debtor but also by creditors against the debtor.
...
D. Administration of Bankruptcy

1. Appointment of Administrator

The administrator is generally a practicing attorney. The administrator takes immediate possession of the debtor's assets (with the exception of assets which are exempt from the estate), administering and managing the bankruptcy estate until the final distribution of assets. Upon receiving permission from the court or the supervisory committee as described below, the administrator may convert all such assets into cash and deposit such in an appropriate bank.

Bankruptcies start fast - a week or two from filing to bankruptcy.

This will require a lawyer in Japan. It's what normally happens to companies in Japan who don't pay their bills.

Depositors with Mt. Gox may be able to argue that they have preferred status as secured creditors, because the Mt. Gox terms of service claim that depositor funds are kept in bank accounts separate from the company's own funds. So they should be paid before landlords, employees, etc.

[HerrAndreas]

nice of you putting this up.

there must be someone with enough funds locked and too little trust and patience left to go for it.

[ArticMine]

This seems to me the fairest way for everyone involved especially in light of the pending litigation. By the way I do not have any assets tied up in MTGox.

[Entropy-uc]

This is long past due.  Someone with withdrawals that haven't been fulfilled should file and put an end to the cancer that MtGox is upon Bitcoin.

[CompNsci]

Very good to know. Thanks for putting that up. It looks like it may be the quickest and cheapest way to get some supervision for them.

[Nagle]

Different countries handle bankruptcy very differently. The US is relatively easy on bankrupt companies. In the US, forcing a debtor into involuntary bankruptcy is difficult and very rare.  Ireland, on the other hand, is very tough on debtors.  Japan is somewhere in the middle, but leans towards the tough end of the scale.

Dun and Bradstreet has a summary of collection options in Japan and how much they cost. As of 2000, a bankruptcy cost about $3000-$5000. Probably more if you have to do it cross-border.

If you're looking at this option, you need a lawyer who's familiar with bankruptcy procedures in Japan.

[cescan]

someone needs to be held accountable.

[Nagle]

With Mt. Gox offline and rumored to be insolvent, it's more important than ever to do this. The people who were gearing up to sue Mt. Gox using Bingham should take the lead on the bankruptcy. Bankruptcy is how you stop the money that's left from disappearing.

[CompNsci]

Nagle - would you be willing to repost your original under Legal. I think it might get more of the attention it deserves there.

I agree this is the best option now for all parties. If Mt. Gox is solvent, they can then prove it to the court and continue with their merger/re-branding plans.

[rograz]

The problem is that Japan doesn't see btc as a currency and therefor mtgox would only have to prove fiat deposit solvency most likely, making this rather pointless.