Compound DAO and other defendants are accused of selling unauthorized names. Plaintiffs allege that they suffered damages by holding the COMP mark for less than $100. Three plaintiffs. $100. A possible class action lawsuit.
Compound DAO is one of eight defendants listed in a lawsuit brought by three plaintiffs who claim they suffered damages when they bought the COMP brand, which they say is a trademark. lack of rights that defendants sell, such as a recently filed lawsuit that rejects class action. The case was filed on Dec. 8 in the US District Court for the Northern District of California, San Francisco Division. It lists Amanda Houghton, Susan Franklin and Charles Douglas as plaintiffs on behalf of other users of the COMP mark.
The plaintiffs claim they received damages by purchasing COMP tokens, the underlying tokens of DeFi lender Compound Finance. The lawsuit also alleges that the violations relate to the sale of COMP tokens as unregistered securities.
Compound DAO is described as a general partnership in the case. The lawsuit argued that the independent company and its affiliates were responsible for selling COMP tokens as securities without authorization. He also alleged that the defendants made false and misleading statements about the prospect of profiting from holding COMP tokens. Finally, the plaintiffs argue that the COMP costs have already started and the defendants are to blame.
Besides Compound DAO, the other defendants are the founders of Compound Finance, Robert Leshner and Geoffrey Hayes. The lawsuit also names Bain Capital Ventures, Polychain Alchemy, and Paradigm Operations, among others, as sponsors.
According to court documents, Douglas bought $75 worth of COMP tokens when they were trading at $130 in January 2022. The other plaintiffs bought $2 and $3 worth of COMP tokens, respectively. Houghton and Franklin also received additional COMP tokens as a reward for watching crypto ads on their Coinbase accounts. They got $9 each for it, but the coins are now worth $1 each. Together, the plaintiffs named in the lawsuit have only $98 worth of COMP tokens as collateral.
The plaintiffs, represented by Gerstein Harrow LLP and Fairmark Partners LLP, asked the court to declare COMP safe. They also want the court to order Compound DAO and other defendants to stop selling these tokens, pay damages, and cover the plaintiffs’ legal fees.
Neither attorneys for the plaintiffs nor Compound Labs responded to The Block’s request for comment by press time.