Crypto Open Patent Alliance v Craig Steven Wright

APPROVED JUDGMENT

I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic. This judgment was handed down remotely by circulation to the parties' representatives by email. It will also be released for publication on the National Archives and other websites. The date and time for hand-down is deemed to be Tuesday 25 ^th July 2023 at 10.30am.

THE HON Mr Justice Mellor

This Judgment is based on an ex tempore Judgment given at the joint CMC in the four actions identified in the heading. The joint CMC was arranged following a CMC in the Coinbase and Kraken actions which took place on 25 ^th & 26 ^th May 2023 at which the Coinbase and Kraken Ds sought a stay of their actions pending judgment in the COPA Claim. At the start of the hearing on 25 ^th May 2023, I made it clear that case management was required in all four of these actions. Fortunately, the parties co-operated to arrange this joint CMC which took place on 15 June 2023. Having reflected further on the central issue, I considered it right to amend slightly what I said in my ex tempore ruling.

It is common ground that a common issue arises, speaking at a general level, in all four actions, namely as to whether Dr. Wright is/was Satoshi Nakamoto. Of the four claims, for understandable reasons the COPA Claim is the furthest advanced, and directions have been given down to a trial which is going to take place in January and February of next year. Fortunately, it is also common ground that this common issue, which has been characterised as the “identity issue”, should be decided once and once only, and how that issue should be decided has been the subject of debate at this hearing.

For this hearing I received skeleton arguments and oral submissions from Counsel identified in the heading, representing either individual parties or groups. I should also mention those parties in the BTC Core Claim who are not represented:

i) D1, BTC Core itself, is alleged to be a partnership comprising or including D2-D26 in the BTC Core Claim. There is a dispute as to whether that partnership exists.

ii) D13, Mr. Eric Lombrozo, who has not entered an appearance.

iii) D17, Spiral BTC Inc. Although the Cs in the BTC Core action claim to have served this company, other parties claim that no such company exists in Delaware. I cannot resolve that dispute. Suffice to say that if this entity exists, it has not entered an appearance and was not represented at the hearing before me.

The issues for determination

The key issues fall under three headings.

The first is essentially a procedural issue, and that is whether the identity issue should be tried by way of a preliminary issue in all four actions, or whether a general stay should be granted in the later three actions, pending the outcome of the COPA claim in which the identity issue will essentially be decided. Certainly in the skeletons for this hearing, the battle lines were drawn in terms of either preliminary issue or a general stay. At the outset of this hearing I introduced a middle ground, a hybrid, whereby some defendants seek a stay, on the basis that they will agree to be bound by the decision on identity in the COPA claim, whereas some other defendants, who are not going to undertake to be bound by the outcome of the COPA trial, will be involved in the preliminary issue: in either case, so they are bound by the result.

The second main issue concerns how to identify the identity issue to be decided, and I have received competing suggestions on this.

The third main issue concerns directions that should be given to accommodate the outcome of the first two issues. As I mentioned, extensive directions have already been given in the COPA claim, down to trial. Dr. Wright seeks a four-week extension for exchange of witness statements, and I will come back to that. The other aspect is how, if other parties are going to be involved in the preliminary issue, directions should be given for them to be involved.

The ‘procedural’ issue

I mentioned the possibility of a hybrid approach on the procedural issue. For the purposes of this issue, it seems to me that in the various parties who are opposing Dr. Wright and his companies, there are essentially two groups. The first group comprises those companies who are either members of or involved in COPA. That includes the Coinbase defendants, one of the Kraken defendants and the Cash App defendants. Perhaps not surprisingly, because they have perhaps varying degrees of involvement in COPA, they are content to be bound by the outcome of the identity issue in the COPA claim. I infer that is because they have sufficient visibility of how that claim is being conducted to leave the trial to be conducted by COPA. Therefore, that group of defendants are very keen on having the proceedings against them stayed, for further reasons which I will come on to.

The second group I characterise in rather general terms as perhaps ‘not privies’. These are the Developers, Blockstream and Chaincode. Some of these defendants have only relatively recently been served with the BTC Core Claim, and they are in a very real sense struggling to catch up with the position which has been reached in the COPA claim. There is certainly evidence filed on their behalf which persuades me at the moment they simply do not know enough to commit one way or another, whether to be bound by the outcome of the COPA claim or whether they should in some way participate in the COPA trial.

It seems to me that on the first procedural issue I should adopt a hybrid approach. For those parties who want a stay, and are prepared to give an undertaking to be bound for all purposes by the outcome of the COPA trial, that should be their way forward. Certainly, there were persuasive points put forward that if that is what they are prepared to offer, they should not be exposed to the incurring of further costs in the COPA trial nor exposed to a costs liability in that trial.

By contrast, for those parties who are unable yet to decide what role they should play in the proceedings, I think it is right to order a preliminary issue as regards them. They will participate at their own risk as to costs, if they choose to engage in the trial beyond what COPA are already doing. It seems to me quite likely that once they have visibility of the disclosure already given by Dr. Wright in the COPA claim, and perhaps some further discussions with the solicitors for COPA in that claim, they may well decide to leave the COPA claim to proceed without their assistance. However, I cannot rule out the possibility that some of the Developers, having reviewed Dr. Wright's disclosure, may consider they have something to add or contribute on...