What happened to Bitmain yesterday? Series 13 (497 that determines its lifeline?)

What happened to Bitmain yesterday?

Zhan's side threw out a legal document that seemed unfavorable to Wu Jihan, hoping to influence customers, suppliers (especially TSMC) and employees. Because of the tight funds, only the sale of futures can recover the money for subsequent actions. A third-party lawyer said that if banks and suppliers sue for arrears one after another, the legal person may even be labeled as a deadbeat and a dishonest person.

Back to this document, the document shows that the Fourth Intermediate People's Court of Beijing suspended Wu Jihan's proposal to veto the previous administrative reconsideration case because the trial of this case needs to be based on the trial results of the civil case (2020) Jing 04 Min Chu 497, which was also heard by the Fourth Intermediate People's Court. Previously, Zhan Ketuan took back the legal person of Beijing Bitmain through two administrative reconsiderations, but Wu Jihan, the 100% shareholder of Beijing Bitmain, is still the executive director.

(Photo from Planet Daily)

According to information obtained by the Planet Daily, the civil case No. (2020) Jing 04 Min Chu 497 is: On November 20, 2019, Zhan Ketuan filed a lawsuit for confirmation of the validity of the resolution with the Haidian District Court, requesting that the shareholder decision signed by Wu Jihan on behalf of Hong Kong Bit on October 28, 2019 (appointing Wu Jihan as the executive director of Beijing Bit and removing Zhan Ketuan from the position of executive director) be invalid. The case was formally accepted by the Haidian District Court on January 8, 2020, and was transferred to the Beijing Fourth Intermediate People's Court for trial on June 2, 2020.

Ji Fengjian, a lawyer at Beijing Yizhun Law Firm, told Planet Daily that Hong Kong Bitmain is the sole shareholder of Beijing Bitmain, and that Hong Kong Bitmain’s decisions on major matters concerning Beijing Bitmain are called shareholder decisions. Wu Jihan is the executive director of Hong Kong Bitmain and legally can make decisions on behalf of Hong Kong Bitmain to replace the executive director and legal representative of Beijing Bitmain.

Lawyer Ji Fengjian told the Planet that the dispute to be resolved in the "No. 497" civil lawsuit is whether the shareholder resolution made by Wu Jihan on behalf of Hong Kong Bitmain is legally valid. The court will determine whether the change of legal representative of Beijing Bitmain is legal and whether the relevant change procedures are legal based on the ruling of this case (administrative litigation). As for whether Wu Jihan will have a chance to regain the position of executive director and legal representative of Beijing Bitmain in the future, lawyer Ji Fengjian said that this depends entirely on the ruling of the "No. 497" civil lawsuit.

A well-known third-party lawyer familiar with the Bitmain equity dispute told Wu Blockchain:

First, regarding the duration of this type of lawsuit. From January 8 to June 2, it should be a dispute over jurisdiction. This type of lawsuit takes a long time, and may take another year and a half;

Second, who should the employees obey? In theory, the legal representative of the company is responsible for representing the company externally, and the internal management of the company is under the management of the person appointed by the shareholders. Currently, the legal representative of Beijing Bit Company is Zhan Ketuan, and the person appointed by the shareholders is Wu Jihan.

Third, regarding the current debt problem, due to the financial disputes between the two parties, Beijing Bit and its subsidiaries may face a huge number of lawsuits, including lawsuits for debts owed to suppliers and banks, and the legal person may be included in the list of dishonest persons in the future.

Fourth, in the final analysis, the lawsuit in Cayman is the core, and who wins or loses in Cayman will determine the final outcome of the equity battle. The "No. 497" civil lawsuit may also need to observe the outcome of the Cayman case, which will delay the trial time even longer.

Let's go back to the topic and say a few words. Wu said that all the lawyers consulted by Blockchain basically believed that Beijing Bit's internal affairs should be managed by shareholders, and it was meaningless to register who was the legal person, because 100% of Beijing Bit's shareholders were Hong Kong Bit. This can be seen from the case of ARM China.

The complexity of the Bitmain controversy lies in the fact that Jihan Wu is not Wu Xiong'ang of ARM China, but just a pure professional manager. He is also the largest individual shareholder of Bitmain Cayman's parent company, holding 36% of the shares. He believes that the revoked voting rights are invalid and he himself is still the controller of the parent company.

From a legal perspective, the lawsuit against the parent company in Cayman is the core of Bitmain’s struggle, and the loser can withdraw automatically after the verdict is made. Making such a fuss in China is not only meaningless, but also a huge harm to all related parties, employees and even the two legendary founders.

(Off topic: I recently heard someone threatened me, saying that he had worked as a police officer and asked me to be careful and pay the price. Wu said that blockchain is just an individual author, barefoot is not afraid of wearing shoes. Your family is big and powerful, with many connections and a lot of black material. If you really want to tear it apart, let's see who will pay a bigger price)