Celsius Sues Core Scientific For Violation Of Agreement And Bankruptcy Rules
Celsius filed a lawsuit against Core Scientific for breaching their agreement and breaking bankruptcy rules by not deploying miners on time and attempting to pass electricity charges without reason.
On September 28th, the bankrupt Celsius Mining Company filed an automatic right of enforcement petition against Core Scientific, the hosting provider for the bitcoin mining arm of the lending company.
In the filing, Core Scientific is accused of breaching their agreement and violating bankruptcy rules.
Specifically, the company stated in filings submitted to the U.S. Bankruptcy Court for the Southern District of New York that Celsius owed Core Scientific about $5.4 million. In response to Core Scientific’s violation of the automatic stay in connection with Celsius’ bankruptcy petition, the company requests that Core Scientific be placed in civil contempt. In July, this company submitted a Chapter 11 bankruptcy petition.
According to Celsius, Core Scientific has forbidden them from receiving any further machines and has illegally attempted to pass on electricity charges that their agreement forbade. Core Scientific also allegedly failed to deploy mining devices on schedule.
Core Scientific has just deployed 6,564 of the 10,885 rigs Celsius delivered, providing the company with 21.5 megawatts of power when their deal stipulates that Celsius is entitled to 79.4 megawatts in September.
“Thus, rigs that Celsius has been planning to deploy (…) are now sitting in limbo with no place to go, instead of earning revenue for the estate,”
It stated in the document
Core Scientific threatened to terminate the hosting agreement between the two companies until this bankrupt company paid its pre-petition obligations, the filing said.
Additionally, Core Scientific billed more than $3.65 million in “pass-through electricity” fees due to “tariffs” after filing for bankruptcy in July, the document said.
The agreement between the companies has a fixed price and only allows Core Scientific to pass on costs due to “new taxes, fees, tariffs or government fees and charges related to the provision of the service” , the document states.
When asked for evidence of the “tariff increases,” Core Scientific sent “information showing increased power rates in the various jurisdictions where Celsius rigs are located” the company said.
“Core Scientific’s improper attempt to ‘pass through’ to Celsius increased power costs violates the automatic stay,” the company said.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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Celsius Sues Core Scientific For Violation Of Agreement And Bankruptcy Rules
Celsius filed a lawsuit against Core Scientific for breaching their agreement and breaking bankruptcy rules by not deploying miners on time and attempting to pass electricity charges without reason.
On September 28th, the bankrupt Celsius Mining Company filed an automatic right of enforcement petition against Core Scientific, the hosting provider for the bitcoin mining arm of the lending company.
In the filing, Core Scientific is accused of breaching their agreement and violating bankruptcy rules.
Specifically, the company stated in filings submitted to the U.S. Bankruptcy Court for the Southern District of New York that Celsius owed Core Scientific about $5.4 million. In response to Core Scientific’s violation of the automatic stay in connection with Celsius’ bankruptcy petition, the company requests that Core Scientific be placed in civil contempt. In July, this company submitted a Chapter 11 bankruptcy petition.
According to Celsius, Core Scientific has forbidden them from receiving any further machines and has illegally attempted to pass on electricity charges that their agreement forbade. Core Scientific also allegedly failed to deploy mining devices on schedule.
Core Scientific has just deployed 6,564 of the 10,885 rigs Celsius delivered, providing the company with 21.5 megawatts of power when their deal stipulates that Celsius is entitled to 79.4 megawatts in September.
“Thus, rigs that Celsius has been planning to deploy (…) are now sitting in limbo with no place to go, instead of earning revenue for the estate,”
It stated in the document
Core Scientific threatened to terminate the hosting agreement between the two companies until this bankrupt company paid its pre-petition obligations, the filing said.
Additionally, Core Scientific billed more than $3.65 million in “pass-through electricity” fees due to “tariffs” after filing for bankruptcy in July, the document said.
The agreement between the companies has a fixed price and only allows Core Scientific to pass on costs due to “new taxes, fees, tariffs or government fees and charges related to the provision of the service” , the document states.
When asked for evidence of the “tariff increases,” Core Scientific sent “information showing increased power rates in the various jurisdictions where Celsius rigs are located” the company said.
“Core Scientific’s improper attempt to ‘pass through’ to Celsius increased power costs violates the automatic stay,” the company said.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Website: coincu.com
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