A class action lawsuit has been filed against a company accused of misleading investors about its capabilities and prospects in the high-performance computing (HPC) sector. The complaint, brought by Paul Williams-Israel on October 7, 2024, in the United States District Court for the Eastern District of New York, targets Iris Energy Limited and its executives Daniel Roberts, William Roberts, and Belinda Nucifora.
The lawsuit alleges that Iris Energy Limited misrepresented its business operations to inflate stock prices. The plaintiff claims that between June 20, 2023, and July 11, 2024, the company made false statements about its ability to operate data centers for HPC applications. These statements allegedly led to financial damages for those who invested in Iris Energy during this period. The plaintiff argues that the company's Childress County site in Texas is not suitable for data center operations due to inadequate infrastructure like backup power sources and cooling systems necessary for HPC workloads.
The complaint highlights several instances where Iris Energy's executives purportedly overstated their readiness and capability to transition from Bitcoin mining to HPC services. For example, Daniel Roberts claimed their facilities were built with HPC in mind from inception. However, a report by Culper Research suggests these claims are unfounded as the facilities lack critical features required for HPC operations. The report also points out that Iris Energy’s pivot towards HPC came suspiciously soon after AI technology advancements gained public attention.
Williams-Israel seeks compensatory damages under federal securities laws due to alleged violations by Iris Energy Limited. The legal action calls for accountability from the defendants for disseminating misleading information that inflated investor expectations and share value artificially.
Representing the plaintiff are attorneys specializing in securities litigation who argue that substantial evidence will support these allegations upon further discovery. Case ID: 1:24-cv-07046.