Jonathan Mills, founder of the Hashling NFT project, sued by investors for misappropriating millions

A group of investors has filed a lawsuit against Jonathan Mills, alleging he misappropriated millions raised through NFT sales and a connected Bitcoin mining venture.

A group of investors has banded together to sue Jonathan Mills, the founder of the Hashling NFT project, for allegedly misappropriating millions of dollars raised through NFT sales and a Bitcoin mining venture.

The lawsuit, filed in Illinois on May 14 and seen by Blockworks, follows a report by The Block on the project’s collapse earlier this year.

According to legal documents, the case centers around claims that Mills transferred at least $3 million in assets to Satoshi Labs LLC—a company he leads—without delivering promised equity returns to other investors in the project.

Investors say they sold two Hashling NFT collections on Solana and Bitcoin, raising over $1.4 million for the project. The funds were meant to be used for mining equipment and other operating expenses, with investors receiving a portion of the project’s profits.

However, the plaintiffs claim they received no earnings and were eventually blocked from communicating with Mills and the project team.

The plaintiffs accuse Mills of fabricating a flawed shareholder agreement to justify his control of the assets. The document awarded Mills a 67% ownership stake and voting rights, while other investors were granted just 2% equity for contributions of up to $20,000.

The name change from Proof of Work Labs to Satoshi Labs was, according to the lawsuit, used to obscure asset control while falsely assuring partners their equity would remain intact.

Mills had no experience with NFTs and initially pitched the project to one of the plaintiffs, who brought in collaborators for art, marketing, and event representation. Among those who invested was Mills’ girlfriend, the complaint claims.

The group is now seeking full restitution and a constructive trust over the project’s assets. They claim Mills’s actions amount to fraud and a breach of fiduciary duty.

“The team worked well together at first, and they made significant contributions to the project's success,” said the plaintiffs’ attorney, Clinton Ind of Ind Law.

“However, Jonathan's actions later betrayed their trust and financial contributions. This lawsuit seeks to hold him accountable for his actions and ensure that the investors receive the compensation and recognition they deserve.”

The case is A. B. C., et al. v. Jonathan Mills, et al., no 23-03853, in the Circuit Court of Cook County, (Illinois).