Bitcoin mining company Hut 8 Corp has filed a motion to dismiss a class-action lawsuit filed by shareholders, Cointelegraph reported. The lawsuit stems from a report by short seller J Capital Research, which claims that Hut 8 overpaid for a company with serious operational problems.
Hut 8 said in a filing in federal court in New York that J Capital sought to profit from a "short-selling and twisting" strategy to drive down Hut 8's stock price. Hut 8 said such cases are typically dismissed and that this case should be no different.
J Capital reported in January that Hut 8 overstated the profitability of its acquisition of US Bitcoin Corp and concealed operational problems at its Texas facility. Hut 8 shares fell 23% after the report was released, triggering multiple shareholder lawsuits.
Hut 8 said its shares have risen about 300% since the J Capital report and have “fully recovered.” The company said many of its forward-looking statements are protected by “safe harbor provisions” and disclosed that USBTC has a limited operating history.
Hut 8 argued that the lawsuit failed to prove that its statements were false, that investors suffered actual harm, and that there was a direct link between the allegations and the decline in its stock price. The company asked the court to dismiss the shareholder complaint.
As of Dec. 3, Hut 8 shares closed at $25.06, down 3.6%, and were up just 0.5% in after-hours trading. So far this year, Hut 8 shares are up nearly 99%, and 296% since their January low of $6.33.
