Jonathan Mills, Founder of Hashling NFT and CEO of Satoshi Labs LLC, Has Been Sued by Several Investors

Jonathan Mills, founder of Hashling NFT and CEO of Satoshi Labs LLC, has been sued by several investors who claim he stole millions of dollars from their joint ventures.

Jonathan Mills, founder of Hashling NFT and CEO of Satoshi Labs LLC, has been sued by several investors who claim he stole millions of dollars from their joint ventures. The lawsuit, filed May 14 in Illinois, accuses Mills of fraud and breach of fiduciary duty after he allegedly failed to distribute promised equity returns.

According to the complaint, the investors raised $1.46 million through two NFT drops on the Solana and Bitcoin blockchains. Despite this success, plaintiffs say they never saw any returns from their investment.

Instead, they claim Mills misappropriated profits from both the Hashling NFT project and a related Bitcoin mining operation. At least $3 million was allegedly transferred from the mining project to Satoshi Labs LLC, formerly known as Proof of Work Labs LLC.

The Shareholder Agreement Controversy

A significant point of contention is a shareholder agreement that plaintiffs describe as “rife with errors.” This agreement supposedly gave Mills a 67% equity share in the company while other investors received just a 2% equity stake despite contributing up to $20,000 each.

Mills also allegedly held a 67% voting interest on all company matters. No other partner had more than 2% voting power, giving Mills the majority to decide all key issues.

Plaintiffs claim Mills assured them their equity stakes would remain unchanged when he changed the company name from Proof of Work Labs to Satoshi Labs. Shortly after these arrangements, Mills allegedly began “ghosting” his business partners.

Project Origins and Team Formation

The origins of the Hashling NFT project can be traced back to discussions between Mills and plaintiff Dustin Steerman, who had a prior working relationship with Mills. Notably, Mills reportedly told Steerman that he did not have any money or NFT-related experience to bring to the project.

“[Mills] had a willingness to help push the project forward, and he did have an idea at the start,” said Clinton Ind, the investors’ attorney from Ind Legal Group LLC. “Even though that wasn’t the final idea, it did embolden it, and… everyone kind of enjoyed working together in those early stages.”

To launch the project, Mills and Steerman enlisted additional team members, who are now plaintiffs in the case. These members assisted with NFT art creation, social media marketing, and even attended NFT conferences in New York to promote the venture.

The lawsuit claims Mills even persuaded his girlfriend to invest in the Hashling NFTs project, showcasing his apparent confidence in the venture despite allegedly planning to misappropriate funds.

In addition to fraud and breach of fiduciary duty claims, the plaintiffs have requested the establishment of a constructive trust over the project’s assets and full legal restitution from Mills.

When reached by email on May 15, Mills had not yet responded to requests for comment on the allegations.

The case highlights the complex legal challenges that can arise in cryptocurrency ventures, especially when formal agreements feature unusual equity distributions. The plaintiffs’ lawsuit aims to recover their investments and determine proper control over the project assets.

May 14 marks the commencement of what could be a protracted legal process to adjudicate the shareholders’ claims against Mills and decide the rightful ownership of the project assets.