The couple behind ParagonCoin, promoted as the cryptocurrency for the cannabis space launched in 2017, have failed to appear in court and cannot be located by the courts, according to a Coin Desk report. Jessica VerSteeg, a former Miss Iowa, and her husband, Russian entrepreneur Egor Lavrov, are being sued over the token sale with plaintiffs asserting that it was an illegal securities offering and that buyers are intitled to refunds or compensatory damages.
In 2018 – about a year after the coin’s launch – the company was fined $250,000 by the Securities and Exchange Commission and ordered to repay the investors of the initial $12 million coin offering. Following the fine, the company put a building up for sale it had planned to use as a co-working space paid for with the token. It’s unclear whether the company paid the SEC fine in full; a 2019 Wall Street Journal report suggests the company missed payment deadlines.
The couple has so far failed to appear at any of the legal proceedings in the Northern District of California. Attorney Donald Enright, who represents the plaintiffs, told Coin Desk that the couple’s attorneys “have withdrawn as counsel.” Plaintiffs are seeking to have the case turned into a class action.
The defendants’ former counsel, attorney Howard Schiffman, said that he hasn’t seen the couple in “years.”
In addition to the VerSteeg and Lavrov, the lawsuit names The Game – the rapper whose real name is Jayceon Terrell Taylor – due to his role promoting the initial coin offering on social media. Technologists Eugene Bogorad, Alex Emelichev, Gareth Rhodes, and Vadym Kurylovich are also named as defendants.
Bogorad told Coin Desk that most of the people named as defendants don’t consider themselves company founders and they only worked on the project in 2017, while VerSteeg promoted the coin throughout 2018.