A federal judge ordered the Commodities Future Trading Commission (CFTC) to serve the decentralized trading platform bZeroX's founders Tom Bean and Kyle Kistner as part of an ongoing lawsuit against Ooki DAO.
bZeroX is the predecessor to the decentralized autonomous organization Ooki DAO.
The lawsuit follows already-settled charges against Bean and Kistner with the CFTC from September regarding bZeroX's commodities offerings. Because the pair hold Ooki DAO tokens — and the CFTC has also charged Ooki DAO holders — they will be served with the lawsuit.
“It seems clear in this case that Ooki DAO has actual notice of the litigation,” wrote District Judge William Orrick, continuing: “But to provide the best practicable notice, the CFTC should serve at least one identifiable Token Holder if that is possible.”
“The CFTC is now ORDERED to serve Bean and Kistner, in their roles as Ooki DAO Token Holders,” he said.
The question of how to properly sue a decentralized organization has been a big issue in this case. Initially the CFTC distributed legal service to DAO users via the DAO’s chat box. But this was met with strong opposition by crypto lawyers — not representing the DAO itself — who argued that this didn't count as due process. By serving two token holders, the CFTC is now trying to demonstrate that it has directly served two members of what it sees as an unincorporated association.
© 2023 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.