California court dismisses huge suit against Hogeg

Moshe Hogeg Photo: Yonatan Bloom

After the court ruled that Moshe Hogeg was not subject to its jurisdiction, Adam Perzow said he would file suit against Hogeg in an Israeli court.

The largest lawsuit filed to date against cryptocurrencies investor Moshe Hogeg has been dismissed, at least for the time being. The US California Central District Court dismissed the $50 million claim filed against Hogeg and two of his partners in venture capital fund Singulariteam by Canadian Internet entrepreneur Adam Perzow, first reported two months ago in "Globes," because of a lack of jurisdiction. Following the claim's dismissal, Perzow told "Globes" that he planned to file the lawsuit again, this time in an Israeli court.

Sources further inform "Globes" that additional legal proceedings will shortly be instituted against Hogeg by investors disappointed with their investments in startups that he led in recent years.

After considering Perzow's claim request and Hogeg's response, US California Central District Court Judge Manuel L. Real stated in his ruling yesterday that Hogeg's connections with California, whether evaluated separately or in general, were inadequate to determine that he was subject to the jurisdiction of his court. He therefore granted Hogeg's petition, filed three weeks ago, for dismissal of the claim against him. This is the second time that a lawsuit filed by Perzow against Hogeg was dismissed for lack of jurisdiction; the same thing happened early this year in a New York court.

Perzow's request for a claim against Hogeg, chairman of Singulariteam and controlling shareholder of the Beitar Jerusalem soccer team, and two of his partners: Kazakh billionaire Kenges Rakishev and Chinese-American investor Joseph Chen was first reported in "Globes" last April. "Forbes Magazine" previously listed Rakishev as one of the 50 most influential people in Kazakhstan, saying that his wealth exceeded $2 billion. According to Perzow's claim, Chen, a director in IDC Holdings, which operates the invest.com website, is a consultant in the ventures led by Singulariteam, including the STX startup, known under the name Stox.

Perzow sold Singulariteam the invest.com domain in 2014 for over $5 million. He alleges that Hogeg and his partners breached their agreement with Perzow to found a joint venture based on this website. In his statement of claim, the Canadian entrepreneur alleged that Hogeg had taken part in an deliberate plot involving at least 16 units or companies, together with Rakishev and Chen. Hogeg says that Perzow has no grounds for a lawsuit against him.

"Globes" reported that three weeks ago, following a mediation proceeding presided over by Judge (ret.) Hila Gerstel, a NIS 17 million lawsuit filed against Hogeg and STX by Chinese investor Zhewen Hu was withdrawn. As part of the mediation agreement, given legal validation by Judge Michal Amit-Anisman, Hogeg agreed beyond the letter of the law, without admitting any assertion, and with the encouragement of the mediator, to pay the claimant $50,000 in legal expenses, a negligible sum in comparison with the amount of the claim.

An earlier lawsuit against Hogeg filed by haredi (Jewish ultra-Orthodox) billionaire Shlomo Rechnitz in a Los Angeles court in March 2018, is still outstanding. Rechnitz alleges that he bought shares Mobli, a startup founded and managed by Hogeg, for $5 million, following a false presentation by Jason Lyons, who served as an intermediary in the deal. Rechnitz is suing Lyons and Hogeg for violations of securities laws and unjust enrichment, and is also suing Lyons for fraud, false and negligent presentation, and violating the brokers registration law in California.

Published by Globes, Israel business news - en.globes.co.il - on June 6, 2019

© Copyright of Globes Publisher Itonut (1983) Ltd. 2019

Moshe Hogeg Photo: Yonatan Bloom
Moshe Hogeg Photo: Yonatan Bloom
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