What changed in this filing

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Item 1. Legal Proceedings

2022-11-14 compared with 2022-08-09 · 51 added, 34 removed, 40 unchanged (68% of the section changed)

Legal Proceedings

January 14, 2021, Plaintiff Michael Ho (“Plaintiff” or “Ho”) filed a Civil Complaint for Damages and Restitution

(“Complaint”) against the Company and 10 Doe Defendants.

The Complaint alleges

six causes of action against the Company, (1) Breach of Written Contract;

January 14, 2021, Plaintiff Michael Ho (“Plaintiff” or “Ho”) filed a Civil Complaint for Damages and

Restitution (“Complaint”) against the Company and 10 Doe Defendants.

The Complaint alleges six causes of action against

the Company, (1) Breach of Written Contract;

(2) Breach of Implied Contract;

(3) Quasi-Contract;

(4) Services Rendered;

Intentional Interference with Prospective Economic Relations;

and (6) Negligent Interference with Prospective Economic

Relations, which is the one plead against “all Defendants” and is most likely to involve later named defendants.

arise from the same set of facts, Ho alleges that the Company profited from commercially-sensitive information he shared with the Company

and (6) Negligent Interference with Prospective Economic Relations,

which is the one plead against “all Defendants” and is most likely to involve later named defendants.

The claims arise

from the same set of facts, Ho alleges that the Company profited from commercially sensitive information he shared with the Company

and then it refused to compensate him for his role in securing the acquisition of a supplier of energy for the Company.

On February 22,

22, 2021, the Company responded to Mr.

Ho’s Complaint with a general denial and the assertion of applicable affirmative defenses.

on February 25, 2021, the Company removed the action to the United States District Court in the Central District of California, where

the action remains pending.

Ho’s Complaint with a general denial and the assertion of applicable affirmative

Then, on February 25, 2021, the Company removed the action to the United States District Court in the Central District of

California, where the action remains pending.

The Company filed a motion for summary judgment/adjudication of all causes of action.

On February 11, 2022,

the Court granted the motion and dismissed Ho’s 2nd, 5th and 6th causes of action.

Discovery is closed.

The Court held a pre-trial

conference on February 24, 2022, where it vacated the March 3, 2022 trial date and ordered the parties to meet and confer on a new trial

The Court discussed the various theories of damages maintained by the parties.

In its ruling on the summary judgment motion and

at the pre-trial conference on February 24, 2022, the Court noted that a jury is more likely to accept $150,000 as an appropriate damages

amount if liability is found, as opposed to the various theories espoused by Ho that result in multi-million dollar recoveries.

outstanding issues of fact and law, it is impossible to predict the outcome at this time;

however, after consulting legal counsel, the

Company is confident that it will prevail in this litigation, since it did not have a contract with Mr.

Ho and he did not disclose any

commercially-sensitive information under any mutual nondisclosure agreement that was used to structure any joint venture with energy

Trial has been postponed to February 2023.

On February 11, 2022, the Court granted the motion and dismissed Ho’s 2nd, 5th and 6th causes of action.

substantially closed.

The Court held a pre-trial conference on February 24, 2022, where it vacated the March 3, 2022 trial date and

ordered the parties to meet and confer on a new trial date.

The Court discussed the various theories of damages maintained by the

In its ruling on the summary judgment motion and at the pre-trial conference on February 24, 2022, the Court noted that a

jury is more likely to accept $150,000 as an appropriate damages amount if liability is found, as opposed to the various theories

espoused by Ho that result in multi-million-dollar recoveries.

Due to outstanding issues of fact and law, it is impossible to

predict the outcome at this time;

however, after consulting legal counsel, the Company is confident that it will prevail in this

litigation, since it did not have a contract with Mr.

Ho and he did not disclose any commercially sensitive information under any

mutual nondisclosure agreement that was used to structure any joint venture with energy providers.

Trial has been postponed to

February 2023.

October 6, 2020, the Company entered into a series of agreements with multiple parties to design and build a data center for up to 100-megawatts

16 unchanged sentences

Plaintiff Tad Schlatre served the complaint on the Company on March 1, 2022.

alleged shareholders have moved for appointment as lead plaintiff.

Those motions remain pending before the Court.

September 12, 2022, the court appointed Carlos Marina as lead plaintiff.

On October 21, 2022, lead plaintiff voluntarily dismissed the

complaint without prejudice.

February 18, 2022, a shareholder derivative complaint was filed in the United States District Court for the District of Nevada, against

12 unchanged sentences

June 1, 2022, the Court entered an order consolidating the two derivative actions.

A June 13, 2022 scheduling order provides for

plaintiffs to file a consolidated complaint and for renewed motions to dismiss the consolidated shareholder derivative complaint.

consolidated complaint has not yet been filed.

the opinion of management, after consulting legal counsel, the ultimate disposition of these five matters will not have a material adverse

A June 13, 2022 scheduling order provides for plaintiffs

to file a consolidated complaint and for renewed motions to dismiss the consolidated shareholder derivative complaint.

The consolidated

complaint has not yet been filed.

the opinion of management, after consulting legal counsel, the ultimate disposition of these matters will not have a material adverse

effect on the Company and its related entities combined financial position, results of operations, or liquidity.

than as disclosed herein, we know of no other material, active or pending legal proceedings against us, nor are we involved as a plaintiff

in any material proceedings or pending litigation other than in the normal course of business.

North Bankruptcy

September 22, 2022, Compute North filed

for chapter 11 bankruptcy protection.

Compute North provides operating services to us and hosts our equipment in multiple facilities.

We deliver miners to Compute North, which then installs the equipment in several facilities, operates and maintains the equipment, and

provides energy to keep the miners operating.

In chapter 11, Compute North is currently seeking to sell substantially all of its assets,

including its direct and indirect ownership interests in the facilities that house Marathon’s miners.

Compute North may also seek

to assume and assign the Compute North agreements to which Marathon is party to one or more third-party purchasers of Compute North’s

assets or it may seek to reject such agreements.

Accordingly, Compute North’s chapter 11 cases could cause a disruption in services

provided by Compute North to us and, therefore, could have an adverse effect on our operations in the facilities managed by Compute North.

this stage of Compute North’s chapter 11 cases, it is difficult to predict whether Marathon will receive any meaningful recovery

on account of its claims.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Legal Proceedings