(BlockBar) Zerocoin Electric Coin Company is being sued by former employee Simon Liu for $2 million over breach of contact, unpaid shares, and damages. To be noted, Zerocoin is the organization behind the popular cryptocurrency Zcash (ZEC). The complaint by the former employee alleges that Zerocoin founders made false promises regarding employee compensation and breached their fiduciary duty to employees. Liu does not recall the “true names and capacities of defendants sued” and is also claiming the defendants operate under fictitious names.
According to the reports, Zerocoin was joined by Simon Liu as Senior Software Engineer in August, 2016. After the joining, Liu had entered into a contract with the company to receive “incentive stock options to purchase” 12,000 units of company stock. Later, the company amended this agreement in October, 2016, reportedly, to award Liu 15,000 units. Liu, who resigned on May 28, 2019, now argues that “Zerocoin did not have authorization to issue common stock to employees in 2016, and that defendants were aware they did not have such authorization.”
Reportedly, he also alleges that his superiors knowingly mislead him. According to him he was misled when he was told that he would receive a “Founders Reward” tied to the number of outstanding company shares then counted as 1,345,486 units. The company provided a status update on December 31, 2018, that admitted Zerocoin had not created a stock option plan for its employees. It also states that no formal option grants had been issued. The company also published another internal statement, one month later, in which it outlined its plans to “issue new shares in the Zerocoin Electric Coin Company, diluting everyone’s percentage of ownership interest.”
It is worth paying attention that Zcash currently trades around $79 and has an overall market cap of just under $600 million. It’s all-time high saw valuations closer to $900 million in January 2018. To be noted, Zerocoin is a limited liability company and is organized under the laws of the State of Delaware. In February, it changed its name from Zerocoin to the Electric Coin Company. This was done to avoid confusion between Zcash and the nonprofit Zcash Foundation.
Mayan MV is a passionate writer and cryptocurrency enthusiast. He currently serves as marketing strategist and contributor at BlockBar, based in Singapore. Mayan has started his career in blockchain technology about five years ago, and he has also written over a hundred articles that span across various fields.