Liquidity Technologies Ltd and Another v. Mark David Lamb and Others

HCA 1646/2023

[2026] HKCFI 1758

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

ACTION NO 1646 OF 2023

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DECISION

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Introduction

1.I have before me the following:

(1)     An application by the 1^st and 2^nd Plaintiffs (collectively, “Ps”) for partial summary judgment against the 1^st Defendant (“Lamb”), 3^rd Defendant (“D3”) and/or 4^th Defendant (“D4”) by Amended Summons dated 8 December 2025 (“SJ Summons”); and

(2)     An application by Lamb for security for costs against Ps by Inter Parte Summons dated 9 July 2025 (“Security for Costs Summons”).

2.The following evidence was filed in respect of the SJ Summons pursuant to previous court order/directions:

(1)     6^th Affidavit of Kirill Gourov (“Gourov”) dated 10 June 2025 (“Gourov 6^th”);

(2)     Affirmation of Ewelina Anna Mielecka (“Mielecka”) dated 5 July 2025;

(3)     Affirmation of Lamb dated 5 July 2025;

(4)     7^th Affidavit of Gourov dated 6 August 2025 (“Gourov 7^th”);

(5)     5^th Affirmation of Douglas Stephen Clark dated 3 September 2025 (“Clark 5^th”);

(6)     Affirmation of Lamb dated 26 November 2025 (“Lamb Nov 2025”); and

(7)     10^th Affidavit of Gourov dated 22 December 2025 (“Gourov 10^th”).

3.An Affirmation of Lamb dated 11 December 2025 (“Lamb Dec 2025”) and a Supplemental Affirmation of Lamb dated 5^th January 2026 (“Lamb Supplemental”) were filed without leave of the court but was agreed by Ps to be considered by me on a de bene esse basis.

4.The following evidence was filed in respect of the Security for Costs Summons:

(1)     Affidavit of Lamb dated 11 July 2025 (“Lamb July 2025”); and

(2)     8^th Affidavit of Gourov (“Gourov 8^th”) dated 15 August 2025.

5.Mr Lamb, a director of D3 and D4, appeared in person, not legally represented, but not having been granted leave to represent D3 and D4, was treated as representing himself only whereas D3 and D4 were treated as absent.

6.Mr Clark, solicitor advocate, appeared on behalf of Ps.

Background Facts

7.The 1^st Plaintiff (“P1”) is a company incorporated under the laws of the Republic of Seychelles (“Seychelles”). 

8.The 2^nd Plaintiff (“P2”) is the wholly owned subsidiary of P1 and is a company incorporated in Hong Kong. 

9.P1 operated a cryptocurrency exchange (“CoinFLEX”) which was co-founded by Lamb and Mr Arumugam (“Arumugam”).   CoinFLEX issued a cryptocurrency named FLEX token which can be purchased or exchanged for cash according to its market exchange rate.

10.P2 was established to employ CoinFLEX’s Hong Kong team and operational staff running CoinFLEX.

11.Lamb was the CEO of CoinFLEX until his removal on 8 October 2023 and a director of P1 and P2 until his removal on 22 October 2023 and 7 November 2023 respectively.

12.Roger Ver, the 2^nd Defendant (“D2”), a well-known cryptocurrency investor, entered into a manual margin agreement dated 14 May 2021 with P1 (“the Margin Agreement”). 

13.D3 and D4 are companies incorporated in Seychelles for which Lamb had been their sole director since their inception in 2023.  D4 is the wholly owned subsidiary of D3.

14.On 9 July 2022, Arumugam and Lamb issued a statement on behalf of CoinFLEX stating that a large individual customer had a written manual margin arrangement with CoinFLEX but had dishonoured his obligations leaving a significant deficit of US$84M.  The statement further stated that they were looking for ways to re-finance CoinFLEX.

15.On 28 July 2022, P1 (through its then sole director, Lamb) applied to the Supreme Court of Seychelles (“Seychelles Court”) for the approval of a Scheme of Arrangement pursuant to section 208 of the International Business Companies Act (“IBC Act”). An interim order was made by the Seychelles Court on 17 August 2022.   

16.The Scheme of Arrangement was approved by the Seychelles Court on 6 March 2023.  The terms of the Scheme of Arrangement approved provided inter alia:

(1)     The creditors of P1 shall comprise: (a) the customers of CoinFLEX who deposited their assets on the CoinFLEX platform; (2) the lenders to P1; (3) the trade creditors of P1; and (4) other counterparties owed money or contractual obligations by P1 (“the Creditors”);

(2)     All existing equity interest in P1 shall be deemed cancelled and extinguished.  Liquidity Technologies Holdings Limited (“LTL Holdco”), a Seychelles company, shall be the sole equity owner of P1;

(3)     The shareholders of LTL Holdco shall comprise: (a) the Creditors owning 65% of its issued shares; (b) the holders of Series B Preferred (as defined therein) collectively owning 20% of its issued shares; and (c) the remaining 15% of its issued shares shall be set aside for the purposes of stock grants, performance awards and other equity linked incentives to eligible employees;

(4)     P1 shall distribute all customer assets comprising P1’s cash assets and assets held in customer accounts on the CoinFLEX Exchange to the Creditors on a pro rata, pari passu basis save for US$10M as distribution holdback (“the Holdback Sum”).  The Holdback Sum was to be allocated to the legal fees of pursuing any legal claims of P1 including the arbitration proceedings against D2 and to the operating expenses of CoinFLEX;

(5)     Four additional individuals shall be appointed to the board of directors of both LTL Holdco and P1.  Each of these individuals shall be designated by the following groups: (a) Platform depositors; (b) SmartBCH holders or SmartBCH Alliance Limited (a BVI company); (c) Series B Preferred holders; and (d) an independent director nominated by platform depositors and reasonably acceptable to Series B Preferred holders;

(6)     P1 shall retain ownership of all FLEX token currently held on P1’s balance sheet;

(7)     P1’s Memorandum & Articles of Association shall be amended and restated to reflect the conditions and terms of the Scheme of Arrangement; and

(8)     Through the Recovery Value Trust and other instruments and entities specified therein, the Creditors shall be entitled to the pro rata share of the net proceeds of all P1’s claims and causes of action against a defaulting manual margin agreement counterparty (i.e. P1’s claim against D2) together with all related claims and rights which have been or to be enforced.

17.To implement the Scheme of Arrangement, LTL Holdco and P1 have procured inter alia:

(1)     All 100,000 issues shares of P1 were transferred to LTL Holdco;

(2)     The Certificate of Arrangement was registered on 5 July 2023;

(3)     On 28 July 2023, P1 filed the amended Memorandum & Articles of Association of P1 (“Amended M&A”) to the Registrar of International Business Companies in Seychelles; and

(4)     On 22 August 2023, Gourov, Charles Ashley Richard Melvin, Samuel Hapak and Huang Yao (“the 4 Additional Directors”) were appointed directors of P1.

18.On 12 August 2023, P1’s arbitration in Hong Kong International Arbitration Centre against D2 for approximately US$84M based on the Margin Agreement (“the Arbitration”) was settled based on a settlement agreement purportedly entered into between P1 (through Lamb) and D2 (“the Settlement Agreement”).  Ps claim that the Settlement Agreement was entered into in breach of duty owed by Lamb to P1 by: (a) entering into the Settlement Agreement without authorisation; (b) giving instructions to counsel to terminate the Arbitration; and (c) putting himself in a position of conflict of interest where the terms of the Settlement Agreement is solely to the benefit of himself and D2, and to the detriment of P1. 

19.Ps have commenced separate proceedings against D2 to set aside the Settlement Agreement in HCCT 87/2023 but in the event the Settlement Agreement is not set aside, P1 claims against Lamb the sum of US$84M and interests, or in the event it is set aside, all costs incurred in the setting aside.

20.Ps further allege that Lamb, D3 and D4 have since early 2023 operated an online cryptocurrency exchange named OPNX Exchange (“OPNX”) which issues a cryptocurrency named OX Token.  OPNX(HK) Limited (“OPNX(HK)”), is a Hong Kong incorporated company wholly owned by D3.  It is alleged that Lamb established D3 and D4 or OPNX(HK) as a competing business, to transfer or licence the assets of Ps to D3, D4 or any other OPNX entity.  It is also alleged that Lamb represented to customers of Ps and the public at large that CoinFLEX will be re-branded or “transitioned” to OPNX and passed off OPNX as that of CoinFLEX or as a business in some way connected with CoinFLEX. 

21.In the Amended Statement of Claim (“ASOC”), Ps claim that there were various misappropriations of Ps’ assets by Lamb:

(1)     A Technology License Agreement entered into on behalf of P1 and D3 on 31 March 2023 (“License Agreement”) which allowed D3 to use all CoinFLEX’s technologies for no consideration is null and void, and therefore Lamb, D3 and D4 have infringed the software and other intellectual property licensed under that agreement for which they are liable to pay damages, give an account of profits and should be subject to injunctive relief;

(2)     Lamb, as one of the administrators of CoinFlex’s account with Fireblocks (an online infrastructure used to move and store digital assets), signed on behalf of P1, and D4 an Assignment, Assumption and Consent Agreement on 25 and 26 September 2023 (“Fireblocks Assignment Agreement”) that assigned to D4 all of P1’s rights, title and interest in the License Agreement between Fireblocks and P1 dated 16 April 2020, for no consideration and which was unauthorized by P1, which resulted in Ps not having access to the Fireblocks account of CoinFLEX;

(3)     There were various alleged wrongful use or misappropriation of assets and human resources of Ps for the operation of OPNX totaling US$10,631,392.90 (“Unauthorized Payments”) for which Lamb, D3 and/or D4 is liable to repay;

(4)     There were also various misappropriations of FLEX tokens from P1 by Lamb to himself, D3 and/or D4 or their affiliates for which Lamb, D3 and/or D4 is liable to compensate, account to P1 and/or make restitution;

(5)     Lamb has divulged confidential information, records and/or trade secrets to third parties including but not limited to D3 and D4 for the benefit of OPNX; and

(6)     Lamb as registered owner of the domain name (coinflex.com) had failed to disclose information necessary to login into and act as administrator and for other infrastructure platforms as well which resulted in Ps not being able to resume business as well.

22.In the ASOC, Ps have claimed inter alia the following relief:

(1)     Damages against Lamb, D3 and D4 for unlawful means conspiracy;

(2)     Declaration that the License Agreement is null and void and restitution of any benefits received by D3;

(3)     Declaration that various amounts of FLEX tokens of P1 misappropriated by Lamb are held on trust for P1 or damages to compensate or account for their value and any profits made therefrom;

(4)     Damages for improperly settling the Arbitration against D2 and improperly giving instructions to terminate the Arbitration, to be assessed;

(5)     Various injunctive relief against Lamb;

(6)     Order that Lamb do deliver up to Ps’ solicitors any and all confidential information which are in his possession, custody or control and to remove, delete, destroy all such information;

(7)     Declaration that all of Ps’ assets transferred to Lamb, D3 and D4 and/or their traceable proceeds are held on trust for Ps;

(8)     Orders that Lamb do deliver up to Ps’ solicitors specified information necessary for access and login to the specified accounts and to transfer ownership of the specified accounts to P1;

(9)     A declaration that the Fireblocks Assignment Agreement is null and void;

(10)     Repayment of or an account of the profits for the Unauthorized Payments;

(11)     Equitable compensation;

(12)     Order that each of the Defendants do provide a full and proper account of the profits they each made and payment of all sums found due to Ps upon such taking of account;

(13)     Interest;

(14)     Costs; and

(15)     Further and/or other relief.

23.According to Gourov 6^th, partial summary judgment is sought on Ps’ claims regarding Lamb’s conduct after he was removed as a director of Ps and those which Ps verily believe Lamb and/or D3 and/or D4 have no defence.  These were as summarised in Ps’ Skeleton Argument dated 29 December 2025 (“Ps’ Skeleton”) as follows:

While a sole director:

(1)      Entering into drop hands the Settlement Agreement with D2 abandoning P[1]’s claim for US$84M, the principal reason for the Seychelles Court ordering the Scheme of Arrangement;

(2)      Causing P1 to transfer 17,277,778 FLEX tokens to a Singapore cryptocurrency platform named Hodlnaut in return for 20,000,000 USDT;

(3)      Signing on behalf of P1 and D3 the License Agreement;

When no longer a sole director:

(4)      Entering into Fireblocks Assignment Agreement on behalf of P1 and D4 to assign P1’s Fireblocks account (which held its digital assets) to D4 when no consideration was given and Mr Lamb had no authority to enter into the agreement;

Post removal as a director:

(5)      Mr Lamb’s failure to give access to all the books and records of CoinFLEX (in particular, electronic records) to Ps’ new board of directors;

(6)      Mr Lamb’s unauthorized transfer of the companies’ assets (6,106,188.14 FLEX tokens) in November 2023 after he has ceased to be a director, in violation of an injunction prohibiting such transfer; and

(7)      Mr Lamb continued to claim that he remained the CEO of CoinFLEX notwithstanding his removal as a director of Ps.

24.By the SJ Summons, Ps seek:

(1)     A declaration that the License Agreement is null and void etc;

(2)     An order that D3 do account to P for any benefits received under the License Agreement;

(3)     Lamb, D3 and D4 be restrained from: (a) acting in breach of confidence or otherwise disclosing, using, divulging, copying, extracting, releasing, publishing to any third party any confidential information and/or records and/or trade secrets of Ps (“the Confidential Information”) in their possession, custody or control; (b) disposing, removing, deleting etc the Confidential Information otherwise than by delivery up or transfer to Ps; (c) making copies of the information other than by delivery up or transfer to Ps; (d) acting or holding out as being authorised to act in the name of Ps and/or CoinFLEX; (e) operating the website(s), customer account(s), trading platform(s), email account(s), telegram group(s) and/or other channels, accounts or platforms operated by and/or under the name of Ps and/or CoinFLEX; and (f) disposing of or dealing with or diminishing the value of any of the assets, intellectual properties, and other technologies of Ps and/or CoinFLEX; 

(4)     An order that Lamb do deliver up all Confidential Information and remove, delete, destroy etc, electronic copies of the Confidential Information in his possession, custody or power and file and serve an affirmation setting out his compliance of such orders;

(5)     An order that Lamb do deliver up all information for access to various accounts and transfer ownership of those accounts to P1 and file an affidavit setting out steps to comply with such orders;

(6)     Declaration that the Fireblocks Assignment Agreement is null and void;

(7)     Lamb, D3 and D4 be restrained from: (a) soliciting or canvassing employees, clients, business and/or business opportunities from Ps; (b) directly or indirectly passing off or attempting to pass off any business of Ds as that of Ps or as business in any way connected with Ps; (c) infringing P’s copyright in any software purportedly licensed under the Licence Agreement; and (d) making use of Ps’ confidential information transferred under the Licence Agreement;

(8)     Lamb do pay damages of 20M USDT or account for profits from the transfer of the 17,277,778 FLEX tokens to Hodlnaut;

(9)     Lamb do pay damage to be assessed for the unauthorized transfer/misappropriation of 6M FLEX tokens from P1 on 20 November 2023;

(10)     Assessment of damages for Ds’ acts of passing off, breach of confidence and copyright infringement; and

(11)     Lamb do pay damages to P1 to be assessed for improperly settling the Arbitration and giving instruction to terminate the Arbitration.

Applicable Principles

25.The applicable principles for summary judgment are well-established.  In Guanghua SS Holdings Limited v Lim Yew Cheng & Another [2022] HKCFI 1052 at §13, Ng J set out a helpful and succinct summary of the proper approach to such application as follows:

(1)     The Order 14 machinery works on the basis that if the plaintiff’s application is properly constituted, it is prima facie entitled to judgment unless the defendant shows cause to the contrary;

(2)     The mere assertion in an affidavit of a given situation by the defendant responding to an application for summary judgment does not, ipso facto, ground leave to defend;

(3)     The burden is on the defendant to show a real or bona fide defence or some other reason for a trial.  The defendant must satisfy the Court that his evidence is capable of being believed and that on the basis of such evidence, there is a fair or reasonable probability of the defendant having a real or bona fide defence;

(4)     In deciding whether there is a fair or reasonable probability of the defendant having a real or bona fide defence, the Court does not isolate each factual issue and consider whether it is possible that the defendant’s story on that issue is credible.  Rather, the Court must look at the whole situation;

(5)     In assessing the credibility of the defendant’s factual case, while the Court will not embark upon a mini-trial on affidavit evidence, the Court is not obliged to suspend its critical faculties and assume that the defendant’s evidence is accurate;

(6)     If having regard to inherent plausibility, inconsistency with contemporaneous documents and other compelling evidence, the defence is not credible, the Court must say so; and

(7)     If the defendant’s evidence is incredible in any material respect, it cannot be said that there is a fair or reasonable probability that the defendant has a real or bona fide defence.

26.Furthermore, the summary judgment procedure is entirely inappropriate where the plaintiff’s entitlement to recover any sum is subject to any serious dispute, whether of law or fact: see Hong Kong Civil Procedure 2026, Vol.1, §14/4/9.

27.As for the legal principles governing application for security for costs under s.905 of the Companies Ordinance, Cap 622 (“CO”), these were helpfully set out in Sunni International Ltd v Kao Wai Ho Francis [2021] 1 HKLRD 841 at §§20-24 by Ng J:

(1)     The court’s jurisdiction under s.905 of CO is engaged once it has been established that the plaintiff company will be unable to meet an adverse costs order.  The court has a discretion under s.905, just as under O.23, r.1 of the Rules of the High Court, Cap 4A, whether to order security for costs having regard to all the circumstances of the case;

(2)     Security for costs may be ordered if there is credible testimony that there is reason to believe that the plaintiff company will be unable to pay the defendant’s costs if the defendant succeeds in the defence.  The fact that a plaintiff is in liquidation is prima facie evidence that it is unable to pay such costs, unless evidence to the contrary is given;

(3)     While the Court may have regard to all the circumstances of the case, including merits, it is not the function of the Court to make a “preliminary run” at deciding the ultimate success or failure of the claim.  The Court should not delve into the respective merits of the parties’ case unless it can clearly be demonstrated one way or other that there is a high probability of success or failure.  The threshold of demonstrating the probability of success is very high; and

(4)     Other circumstances which might be taken into account in deciding whether or not to grant security for costs include, inter alia, whether the application is being used oppressively e.g. so as to stifle a genuine claim, whether the plaintiff’s want of means has been brought about by the defendant’s conduct and delay in making the application.

Discussion re: SJ Summons

Entering into drop hands the Settlement Agreement with D2

28.In Clark 5^th, the judgment of Mr Justice Vidot of the Seychelles Supreme Court delivered on 31 July 2025 (“Seychelles Judgment”) was exhibited.  Ps rely on the Seychelles Judgment to seek judgment for their claim against Lamb for improperly settling the Arbitration:

“[28] The Defendant [i.e. Lamb] represented the Plaintiff [i.e. P1] as a Director thereof. As I have pronounced above, it is absolutely clear to this Court that the Defendant was absolutely aware of the reconstruction application made in pursuance to Section 208 of the IBC Act. He was equally aware of the Order of the 6^th March 2023 approving the scheme of reconstruction. The Plaintiff had received a Certificate of Arrangement from the FSA. Hence the Defendant, as Director needed to implement certain changes to the directorship. It is averred and not traversed that at the material time, the Plaintiff was involved in an arbitration in Hong-kong, claiming about US$84M from Mr Roger Ver. This was in response to breaches of agreement by Mr Roger Ver as regards to his trading on Coinflex. Without consultation nor knowledge of other Directors and/or shareholders the Defendant proceeded to enter into and sign a settlement with Mr Roger Ver which was to his benefit and that of Roger Ver. That irrespective that the Plaintiff through the Defendant’s directions filed with the Registrar of Companies an amended and restated M&A on 28^th July 2023.

[29] Directors of a company have a fiduciary duty towards the company. That duty should reflect a relationship of trust and loyalty between the directors, the company, its members and shareholders. Directors should exercise such fiduciary duty in conformity with the Articles of Association of the Company. The directors should act in the interest of the company. It should not be for the directors’ personal interest. It is expected that a director would act in good faith. Sections 50 to 55 inclusive of the Companies Act list the duties and powers of directors of a company. More importantly and pertinent to this case is Part 111 of the IBC Act which provides for duties of directors. Therefore, this Court has to consider whether or not the Defendant was acting in good faith when he decided to enter into a Settlement Agreement which provided for relinquishing all claims against Roger Ver at the Hong-kong arbitration for a claim of approximately US84M for breaches of agreement in relation to trading on Coinflex.

[30] The Plaintiff’s witnesses all testified that the purpose of reconstruction of the plaintiff company, thus the application before the Court for a scheme of arrangement in terms of section 208 of the IBC Act was to pursue the arbitration against Roger Ver. In fact the Defendant proceeded in breach his fiduciary duty, signed the Agreement that provided no benefit to the company and same time benefitted the Defendant to a waiver of liability against the liability Roger Ver has or may have against the Defendant. It is a necessary requirement for a director should not personally benefit from any interest he may have in a proposed transaction or arrangement. A director is duty bound not to accept benefits from third parties that compromises his relationship with the company.

[31] It is uncontroverted that Mark Lamb was made aware of the amended M&A (Exhibit P7A and P7B) of Liquidity dated 18^th July 2023. The Articles provide for the composition of the Board of Directors. Therefore, the Defendant acted in contravention of the Articles by taking the sole decision to settling the claim against Mr Roger Ver acting as sole director. In fact, section 144 of the IBC Act which deals with duties of a director provides as follows;

‘ Subject to this section and section 145, a director, in exercising his powers and performing his duties, shall-

(a) act in accordance with the company’s memorandum and articles;

(b) act honestly and in good faith and in what the director believes to be in the best interests of the company; and

(c) exercise the care, diligence and skill that a reasonably prudent person would exercise in the same circumstances.’

In entering into the agreement with Roger Ver, the Defendant was not acting in conformity with the company’s M&A and neither was he acting in good faith. The Board of Director had not resolved to settle the arbitration proceedings in Hong-kong and as a result the Plaintiff has been seriously prejudiced by such action. It is starkly evident that the Defendant breached the fiduciary duty towards the Plaintiff.

…

[35] Relying on the uncontroverted testimonies of the Plaintiff’s witnesses and having given due consideration of the various exhibits, I conclude that there is sufficient evidence that supports allegation of breach of section 144(b) by the Defendant in that:

i. he failed to inform the creditors or Creditor Directors of the settlement agreement;

ii. his Counsel, Mr Yeo opposing the approach of Mr Behlmann representing Lowenstein Sadler LLP who claimed to represent the Creditors Directors which shows direct intent to deceive the creditors;

iii. he provided no benefit nor consideration to the company or creditors of the company in the settlement agreement;

iv. he agreed to a personal waiver of liability in the settlement which is of personal interest rather than the interest of the company.”

29.In Lamb Nov 2025, a summary of Lamb’s position regarding Ps’ claim that he improperly settled the Arbitration was set out as follows:

(1)      I deny that the Settlement Agreement dated 12 August 2023 was entered into improperly or in bad faith;

(2)      The Settlement Agreement was entered into because P1 had exhausted its legal budget, could not fund the continuation of the Arbitration, and the creditors failed to provide promised funding despite being given 5 days’ notice;

(3)      I notified the creditor representatives of the funding crisis on 7 August 2023 and repeatedly requested confirmation of funding, which was never provided;

(4)      The creditors’ own lawyer stated in writing that the creditors were “ready, willing and able” to fund, but then they went silent and provided nothing;

(5)      Settlement was the only commercially rational option in the circumstances – the alternative was the collapse of the Arbitration with zero recovery;

(6)      I received no personal benefit from the Settlement Agreement;

(7)      I was myself a creditor of P1 and suffered loss from the outcome; and

(8)      The Seychelles Judgment relied upon by Ps was obtained entirely ex parte, without the email evidence now before this Court, and should be given limited weight.

30.The email evidence referred is Exhibit “MDL-1” and is said to demonstrate that Lamb notified the creditors of the funding crisis on 7 August 2023, the creditors promised that they were ready, willing and able to fund but went silent and failed to provide any funding and settlement was therefore commercially necessary.

31.Lamb Nov 2025 further stated that the Seychelles Judgment cannot satisfy the requirements for issue estoppel for the following reasons:

(1)      No fair opportunity to contest.  I was not present at the hearing.  I was not represented by counsel.  I had no opportunity to present evidence or cross-examine witnesses. An ex parte judgment, by definition, involves no contest.  Ps presented their case unopposed.

(2)      Not a judgment “on the merits” in the relevant sense.  A judgment obtained without any participation by the defendant is not a determination “on the merits” in the sense required for issue estoppel.  It is a determination based solely on the evidence on one party.

(3)      Incomplete evidentiary record.  The critical documentary evidence at MDL-1 was not before the Seychelles Court.  The Seychelles findings on authority and good faith were made without the contemporaneous emails showing that I notified the creditors, sought funding, and was met with silence.

(4)      Fundamental unfairness.  To hold that an ex parte foreign judgment binds a defendant who had no opportunity to participate would be fundamentally unjust and contrary to the basis principles of natural justice.

32.In Lamb’s Skeleton Argument, he also submitted that there is a triable issue on his authority to enter into the Settlement Agreement when the Tribunal issued a Procedural Order No. 7 on 28 August 2023 (“Procedural Order”) recording that it was satisfied that the parties were duly represented by their respective counsel, had jointly requested the termination of the Arbitration and on the basis of the Settlement Agreement terminated the Arbitration.  See also Lamb Dec 2025.

33.However, this last argument can be disposed of quickly.  It is plain from the Procedural Order, in terminating the Arbitration, the Tribunal expressly stated it did so without deciding the validity of the Settlement Agreement and authority of P1’s board or P1’s right under the Scheme of Arrangement.  See at §43 of the Procedural Order where it was stated that: “The Tribunal decides to terminate the present proceedings in the form of a procedural order and not in the form of an award, as requested by the Parties.  It does so because there are no terms of the settlement to record.”  See also at §44, where it was recorded that in reaching its decision the Tribunal notes as follows:

(a)      The Tribunal does not make any determination as to the validity of the Settlement Agreement.  Pursuant to Clause 7.2 of the Settlement Agreement, “[t]he High Court of the Hong Kong SAR shall have exclusive jurisdiction to settle any dispute(s) which may arise out of or in connection with this Settlement Agreement and the Parties irrevocably submit to the exclusive jurisdiction of the High Court of the Hong Kong SAR.”;

(b)      The Tribunal does not make any determination as to the composition or authority of the Respondent’s [i.e. P1’s] Board or the Respondent’s right under the scheme of arrangement approved by the Supreme Court of Seychelles on 6 March 2023;

(c)      The Tribunal is satisfied, based on the powers of attorney or letters of engagement presented in the present arbitration by the Claimant and Respondent, respectively, that the Parties, duly represented by their respective counsel on record, jointly requested the termination thereof; and

(d)      The Tribunal does not rule on the merits of any claims or counterclaims presented in the present arbitration as the Parties have agreed that the Arbitration is to be terminated.

34.I then consider whether by reasons of the Seychelles Judgment, there is no triable issue whether Lamb had no authority to settle the Arbitration as the issue is res judicata.

35.It was not disputed that the requirements for issue estoppel are: (a) that the earlier judgment relied on must have been a final judgment; (b) that there must be identity of parties; and (c) identity of subject matter.  See Carl Zeiss Stiftung v Rayner & Keeler Ltd and Others [1967] 1 AC 853 at 909G-910A.

36.I am of the view that a triable issue is raised whether the Seychelles Judgment is a judgment which is final and conclusive where it plainly was an ex parte decision (see §6 of the Seychelles Judgment) and it appears that it may be liable to be set aside.  In Carl Zeiss Stiftung, it was held that a judgment would not be regarded as conclusive if the judgment is capable of being reopened by the foreign court.  See at 918F-919D:

“ It is clear that there can be no estoppel of this character unless the former judgment was a final judgment on the merits. But what does that mean in connection with issue estoppel? When we are dealing with cause of action estoppel it means that the merits of the cause of action must be finally disposed of so that the matter cannot be raised again in the foreign country. In this connection the case of Nouvion v Freeman is important. There had been in Spain a final judgment in a summary form of procedure. But that was not necessarily the end of the matter, because it was possible to reopen the whole question by commencing a different kind of action: so the summary judgment was not res judicata in Spain. I do not find it surprising that the House unanimously refused to give effect in England to that summary judgment.

When we come to issue estoppel I think that, by parity of reasoning, we should have to be satisfied that the issues in question cannot be relitigated in the foreign country.   In other words, it would have to be proved in this case that the courts of the German Federal Republic would not allow the re-opening in any new case between the same parties of the issues decided by the Supreme Court in 1960, which are now said to found an estoppel here.  There would seem to be no authority of any kind on this matter, but it seems to me to verge on absurdity that we should regard as conclusive something in a German judgment which the German courts themselves would not regard as conclusive.  It is quite true that estoppel is a matter for the lex fori but the lex fori ought to be developed in a manner consistent with good sense.”

37.In Lamb Supplemental, he says that whilst he had not applied to set aside the Seychelles Judgment because he was not properly advised on the procedural steps available to him, he is aware that D2 has commenced proceedings to set aside the Seychelles Judgment on 16 September 2025, and on 11 November 2025, Judge N Burian ordered a copy of the “Plaint” of D2 seeking to oppose and set aside the Seychelles Judgment be served on Lamb on being satisfied that D2’s application complied with the relevant provisions of the law and it was a proper case for service out of jurisdiction and ordering Lamb to appear in court on 12 December 2025 in answer to the Plaint.

38.Mr Clark relied on the case of Nintendo of America Inc v Bung Enterprises Ltd [2000] 2 HKC 629, where it was held that the fact that a judgment is a judgment by default is not a ground for saying that the judgment is not final and conclusive: see at 634A-B.  However, that case was one where the plaintiff brought an action to enforce a default judgment entered against the defendant in the United States.   It was in that context that Recorder Edward Chan SC at 633G-H held “it is well established that for the purpose of enforcement by an action in Hong Kong, a foreign judgment may be final and conclusive even though it is a default judgment liable to be set aside in the very court which rendered it.”   

39.The circumstances of that case are also very different to the present case as the defendant had initially defended the claim and also brought a counterclaim against the plaintiff.  Furthermore, the defendant had also applied to set aside the default judgment and succeeded but on conditions which it later decided not to comply with.  It was therefore clear that the defendant had submitted to the jurisdiction of the court in bringing a counterclaim and using its procedure in applying to set aside the judgment (at 632E-F).  It is therefore readily understandable when the learned Recorder said at 634B that, “The defendant cannot improve its position by refusing to comply with the procedural requirement of the foreign court or refusing to defend an action properly brought against him in a foreign court.”  On the other hand, in the present case, whilst there can be no doubt that Lamb had notice of the Seychelles proceedings, Lamb puts Ps to proof that the Seychelles proceedings were properly served on him and that the Seychelles court had jurisdiction over him personally.  Although Mr Clark submitted that as a director of a companies incorporated in Seychelles, Lamb must have impliedly submitted to the jurisdiction of the Seychelles court, this raises a triable issue of law.

40.Furthermore, the question of whether a default judgment may give rise to res judicata is not all together straightforward: see Spencer Bower and Handley: Res Judicata, 6^th Edn, §2.22 referring to the more recent view of Etherton MR in R (on the application of Gray) v Chief Constable of Nottinghamshire Police [2018] 1 WLR 1609 at §52 that statements to the effect in previous authorities that default judgment may give rise to estoppel should be treated with caution.  In all, difficult questions of law are raised which is not appropriate to be resolved in an application for summary judgment.

41.However, even if there is a triable issue whether Ps can rely on the Seychelles Judgment and even if it cannot be relied upon, it remains a bare assertion by Lamb that the settling of the Arbitration was not improper but in good faith and in the interest of P1.

42.The clear terms of the Settlement Agreement is for P1 to give up the US$84M claim against D2 for no apparent benefit to P1 whereas Lamb himself benefitted from D2’s waiver of liability of claims which D2 has or may have against him. 

43.The fact that settlement of (as opposed to pursuing) the Arbitration was not in the interest of Ps is also evident from the fact that Lamb had applied and deposed to the Seychelles Court in July 2022 that the Scheme of Arrangement was in the best interest of the P1 or creditors or members (under s.208 of IBC Act).  According to his evidence, it was because of D2 that caused the company to commence with the restructuring and the Scheme of Arrangement would maximize the outcome for the creditors (see Judgment of Esparon J delivered on 6 March 2023 at §§37-38).

44.The assertion that it was in the best interest of P1 to settle the Arbitration because there was no funding is also contradicted by the Scheme of Arrangement that provided for US$10M for legal fees for the Arbitration and operational expenses of CoinFLEX.  Whilst Lamb attempted to rely on Exhibit “MDL-1”, which records Lamb’s assertion that the lawyers said they need around $852k for the arbitration and “we have run out of legal budget”, Bryan Reyhani of Lowenstein Sandler LLP (lawyer for P1) replied on 8 August 2023, “This is the first we’re hearing about any monies owed to CC [Clifford Chance] in connection with the RV matter.  What happened to the corporate funds that were earmarked to cover the legal expenses associated with the RV matter?  Such monies should be readily on hand to pay CC for the services they are providing and you should pay it promptly.  Either way, subject to learning more information, the creditors – as sole beneficiaries of the RV arbitration pursuant to CF’s scheme of arrangement – are ready, willing and able to cover any monetary shortfall.”  There was a further email on 8 August 2023 where Bryan asked for records of CC’s invoices and payments to see how the corporate funds were spent for legal services and current financial statements (“as there should be ample funds to cover legal and expert fees”).

45.Furthermore, the assertion that CC would be pulling out unless their fees would be paid is flatly contradicted by Gourov 10^th and an Affirmation of Thomas Richard Walsh, a partner of CC, dated 10 October 2023, where it was stated that CC resigned because they found Lamb had forged a Confidentiality, Non-Disclosure and Without Prejudice Communications Agreement dated 30 June 2023 (“NDA”) entered into with D2 which was given to CC to put before the Tribunal.  The fact that the NDA was forged is confirmed by D2’s 4^th Witness Statement in the Arbitration.

46.In all, I do not find the matters raised by Lamb in defence to the entering into the Settlement Agreement credible such as to afford a real or bona fide defence.  At the very least, judgment should be given for this part of Ps’ claim.

Re: Hodlnaut transfer

47.In Lamb’s Defence, §4.3 he has admitted that in around May 2023, he caused P1 to transfer 17,277,778 FLEX token to Hodlnaut but claims the proceeds (20M USDT) were used to fund OPNX operations and were used in the restructuring operations.  Essentially, Lamb’s case that there was a townhall meeting attended by over 90% of creditors as evident from CoinFLEX Q&A on 6 April 2023 (“Q&A”) and that there was a formal restructuring vote which the creditors voted to create a new business and supported the OPNX restructuring plan to rescue P1 which was in financial difficulties.  Lamb also relied on the WhatsApp messages between him and Gourov in January and February 2023 where there were discussion of the valuation of CoinFLEX, the equity split and board membership of the new company.   He also submitted that given the involvement of Gourov, who represented 68% of the creditors, he had the authority to go ahead with the restructuring and all along they had acquiesced to him so acting.  In the latest reply submissions, Lamb claims that the 20M USDT belonged to OPNX and he did not have to report to P1’s Board.   Lamb also relied on ratifications by the creditors and Gourov, even if he exceeded his authority.

48.Lamb’s case is contradicted by the terms of the Scheme of Arrangement approved by the Seychelles Court in March 2023 that P1 shall retain ownership of all FLEX token currently held on P1’s balance sheet and that part of the Holdback Sum would be used to fund operations of CoinFLEX.  There is no mention at all of OPNX’s role in the Scheme of Arrangement or transfer of assets/funds to OPNX not withstanding the alleged discussion back in January/February 2023. 

49.The Q&A and WhatsApp messages relied upon by Lamb which I have carefully read are unequivocal and do not support Lamb’s alleged restructuring.  Lamb has essentially invited me to read those messages in the way understood and explained by him.

50.However, given that Mr Clark has indicated Ps do not seek summary judgment on the actions in relation to the establishment of OPNX and the “bridging” of P1’s business to OPNX (see Ps’ Skeleton, §§12-13), which must be an acceptance that in relation to that claim there are triable issues raised, and given that there will be a trial of those issues, it seems to me that there is a reason for this issue to also go to trial. 

Re: License Agreement

51.Ps rely on the fact that no consideration is stated in the License Agreement and effectively gave away all P1’s rights in intellectual property and was a one-sided contract in favour of D3.   

52.In Lamb’s Skeleton Arguments dated December 2025, it was submitted that there are WhatsApp messages to prove inter alia that CoinFLEX became a shareholder in OPNX as consideration.   On the other hand, Mr Clark submitted the Licence Agreement contains an entire contract clause.   Insofar as Lamb seeks to rely on some sort of a collateral agreement, this has to be believable.  Lamb’s reliance on the WhatsApp conversations do not clearly support Lamb’s case that the consideration was that CoinFLEX became a shareholder of OPNX. 

53.Lamb’s case also seems to be contradicted and internally inconsistent when in Lamb’s Skeleton in Reply dated 8 January 2026, he asserted that CoinFLEX did not become a shareholder of OPNX because Gourov (representing 68% of the creditors) blocked it.  Whilst he submitted that multiple witnesses can testify to this, no affirmations have been filed by these witnesses.  Lamb’s defence remains a bare assertion unsupported by contemporaneous document or independent witnesses and is incredible.  However, again insofar as the defence raised relates to bridging of P1’s business to OPNX, this matter should be tried together with P’s other claims in this respect.

54.Furthermore, Ps seek a declaration that the License Agreement be declared void and an injunction against Ds for infringement of copyright and disclosure of confidential information etc. which are discretionary remedies.  Given that in the present case Lamb has raised the doctrine of “unclean hands” of Mr Komaransky who he alleged has funded and control these proceedings which should be imputed to Ps and also raised acquiescence and estoppel, it seems to me that summary judgment is not appropriate where these issues are fact-sensitive and should be matters to be investigated at trial: see Top Base Development Limited & Ors v Lloyd Laurence Philip and Fong Yin Mei (unrep) CACV 286/2007, 23 July 2008, §28 and The Incorporated Owners of Hong Kong House v Senfield Limited (unrep) CACV 117/2003, 12 November 2003, §14.

Re: Fireblocks Assignment

55.Ps’ case is that at the time when he was no longer a sole director he represented to Fireblocks that he was the sole director and did not have actual authority of P1’s Board of Directors to sign the Fireblocks Assignment.  There can be no real dispute that at the time of entering into the Fireblocks Assignment, the 4 Additional Directors were appointed to P1’s board.  However, Lamb’s case is that he was still one of the directors and had full authority to act on behalf of P1. Furthermore, he claims that the agreement served a legitimate purpose for handling client funds for customer who had migrated from CoinFLEX to OPNX as part of the restructuring.

56.Again, whilst I am skeptical whether Lamb has a bona fide defence to this claim where it seems the matters stated are him are unsupported by any contemporaneous documents, but insofar as he relied on the alleged restructuring to OPNX and Gourov’s alleged involvement (which Gourov 7^th at §§12 and 19 said falls outside the scope of the present application and did not address the issue of authorisation by creditors in details) and this is admittedly an issue for trial, this issue should also be tried.

Re: Lamb’s acts after his removal as a director of P1

57.In relation to Ps’ claim that Lamb had failed to provide access to books and records of P1, it remains a bare assertion that he did not have control or access which is inherently unlikely as he was the sole director until the 4 Additional Directors were appointed to the board.

58.In respect of the domain name, in the Response to the World Intellectual Property Organisation filed on Lamb’s behalf dated 22 March 2024, it was mentioned that the domain name was acquired by Lamb prior to the launch of the CoinFLEX business in 2019 and he had purchased the domain in his own name on around 18 December 2018 from a third party.  Lamb’s case is also contradicted by a telegram chat between Lamb and Huaxing Lu on 28 February 2025 when Lu asked Lamb to give Gourov access to emails and the domain but Lamb replied, “Happy to give it in exchange for this being over.  Obviously I’m not giving it for free.”  Whilst Lamb tried to put his gloss over this in Lamb Supplemental explaining he was prepared to help obtain access for a fee, this is plainly not what was stated. 

59.Whilst I have real reservations on Lamb’s assertion that he had no administrative control of the domain name and the various infrastructure systems but given he also said that these were OPNX accounts not CoinFLEX accounts because of the alleged restructuring, this is a matter which should be resolved at trial.

60.In relation to the 6,106,188.14 FLEX tokens in November 2023 from P1, Lamb puts Ps to strict proof that the CoinFLEX Fireblocks corporate wallet from which the FLEX tokens were transferred were owned by P1 and that he actually or personally initiated, authorised or procured the transfer.  I agree that I should not be and am not in a position to resolve this on affidavit evidence.  Lamb also asserted that an OPNX user requested the transfer and it was an ordinary business of OPNX which the Amended Injunction Order dated 20 October 2023 expressly permitted him to carry on the ordinary business of OPNX.  Again this relates to the “bridging” of P1’s business to OPNX and is a matter for trial.

61.Lastly, in relation to Lamb’s holding out as a CEO of P1, there is no real response by Lamb.  By his email of 3 September 2024 to Rouben Trivedi, Lamb still claimed to be the CEO of CoinFLEX.  No response has been made by Lamb in his affirmations save at the hearing he said this signature had been left over from when he was a director.  Clearly, after he has been removed he must not hold himself out as a director or CEO of P1.  However, as the injunction sought is an equitable relief and as mentioned Lamb has raised the doctrine of “unclean hands”, whether a permanent injunction should be granted should be left to be determined at trial.

Disposition re: SJ Summons

62.Accordingly, judgment ought to be entered against Lamb for improperly settling and giving instructions to terminate the Arbitration with damages to be assessed.

63.As I am only prepared to enter judgment for a part of Ps’ claim, and unconditional leave to defend is granted on all the other claims, I would order costs of the SJ Summons be in the cause.  See Hong Kong Civil Procedure 2026, Vol.1, §14/7/10.

Discussion and Disposition re: Security for Costs Summons

64.This court has a discretionwhether to order security for costs and is to have regard to all the circumstances of the case.

65.Even if it appears by credible testimony that there is reason to believe P1 will be unable to pay Lamb’s costs because in Gourov 10^th it was admitted that P1 has been served with bankruptcy proceedings in the US on 17 November 2025 and because of the Lamb’s refusal to provide access to relevant records it is very difficult for P1 “to mount a substantive defence”, for all the following reasons, I will not exercise my discretion to order security in the present case:

(1)     I have ordered judgment be entered against Lamb for a part of Ps’ claim and damages to be assessed;

(2)     Lamb is not legally represented and his costs incurred to date should not be substantial;

(3)     Any impecuniosity of P1 is arguably caused by Lamb’s conduct in settling the Arbitration;

(4)     No material is placed before the court to enable it to come to a view on the quantum to be ordered as security.  There is a claim to HK$15.1M for security on the bare assertion of the complexity and “international scope of this litigation”.  There is no skeleton bill to provide a breakdown of the exorbitant sum sought; and

(5)     Whilst it has been asserted in Lamb July 2025 that the amount includes “solicitor-and-client costs and disbursement” and defending the claim requires “expert evidence on cryptocurrency matters” etc., there is no evidence that Lamb has engaged lawyers and/or experts to assist him.  Notwithstanding the refusal for him to represent D3 and D4, as sole director, Lamb has not even instructed lawyers to represent them with the consequence that D3 and D4 are treated as absent. 

66.I therefore will dismiss the Security for Costs Summons with costs to Ps, to be taxed, if not agreed.

Mr. Douglas Clark, Solicitor Advocate of Messrs Tanner De Witt, for the 1^st and 2^nd Plaintiffs

The 1^st Defendant appeared in person

The 3^rd and 4^th Defendants were not represented and did not appear