Cardano Foundation faces new lawsuit from ‘old business’

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A company that previously worked with the Cardano Foundation on different projects is now suing the organization. Z/Yen Group Ltd. out of the U.K., which was previously a research partner for the blockchain company, has submitted a lawsuit against the Cardano Foundation, according to an announcement on the Cardano website, but no significant details are provided. Given the fact that the two entities worked together on several research projects, it could be that the suit is tied to an intellectual property dispute.

Cardano states that it released the notice of the lawsuit because it wants to remain transparent. It adds, “The proceedings relate to an alleged agreement between the Z/Yen Group Limited and the Cardano Foundation dated July 2017.” However, that agreement was terminated early by Cardano for “various reasons” that the foundation didn’t spell out.

Less than two years ago, when the two entities were still on the same side, they published a joint report called “The Quantum Countdown: Quantum Computing and the Future of Distributed Ledger Encryption.” It’s possible that the lawsuit could be a result of work associated with that paper, especially since Cardano is apparently now working on quantum-resistant signatures. Charles Hoskinson, the founder of Cardano, is staying tight-lipped on the whole ordeal, only explaining in the company notice about the lawsuit, “The Cardano Foundation fully rejects the claims raised by the Z/Yen Group Limited. Due to the ongoing nature of this judiciary process, no further information will be given while proceedings are in progress.”

While he may not have wanted to relay more details, consternation over the lack of substance forced his hand and he put together a YouTube video to provide a better description. He explains that it’s “old business” not specific to Cardano and adds, “It’s not an intellectual property dispute. It’s merely a commercial dispute. IOHK has nothing to do with this issue. There is nothing in what Z/Yen has done that has ended up in the protocol design the code or anything implemented in Cardano.”

He further explains, “This is old business stemming from the prior administration at the Cardano Foundation Michael Parsons. Parsons was a good friend with another businessman who’s the Principal of Z/Yen Group Limited. So the nature of that relationship, in my understanding of it, was that they would write a series of reports on behalf of the Cardano Foundation.” He states the lawsuit is not for a particularly large amount of money, and that it’s puzzling that Z/Yen would choose a lawsuit over arbitration. He doesn’t expect any disruptions in Cardano and reiterates that the dispute doesn’t center on anything related to the Cardano project itself.