According to Cointelegraph, Bitcoin mining company Hut 8 Corp has filed a motion to dismiss a class action lawsuit brought by shareholders. The lawsuit stems from a report by short-seller J Capital Research, which claims that Hut 8 overpaid for a company with serious operational issues.
Hut 8 stated in documents filed with the New York federal court that J Capital is attempting to depress Hut 8's stock price to profit from 'short selling and distortion' strategies. Hut 8 believes such cases are typically dismissed and that this case should be as well.
In a report from January, J Capital claimed that Hut 8 exaggerated the profitability of its acquisition of US Bitcoin Corp and concealed operational issues at its Texas facility. Following the report's release, Hut 8's stock price fell by 23%, triggering multiple shareholder lawsuits.
Hut 8 stated that its stock price has risen about 300% since the J Capital report and has 'fully recovered.' The company claims that many of its forward-looking statements are protected by 'safe harbor provisions' and has disclosed that USBTC has a limited operating history.
Hut 8 believes that the lawsuit fails to prove that its statements were false, that investors suffered actual harm, and that there is a direct link between the allegations and the drop in stock price. The company is requesting the court to dismiss the shareholder complaint.
As of December 3, Hut 8's stock price closed at $25.06, down 3.6%, with after-hours trading up only 0.5%. Year-to-date, Hut 8's stock price has risen nearly 99%, up 296% since its January low of $6.33.