A Federal Judge in Little Rock, US, has provisionally paused Arkansas State’s attempts to close down a cryptocurrency mining firm owned by an individual of Chinese descent. This decision arrives following the firm’s plea for a Temporary Restraining Order (TRO) alleging unlawful discrimination.
Federal Judge Awards Temporary Restraining Order
Chief US District Judge Kristine Baker granted a temporary restraining order amidst the ongoing legal dispute involving the Arkansas state and the cryptocurrency mining company, Jones Eagle LLC. According to Arkansas Advocate reports, the firm’s attorneys sought the TRO, which was sanctioned by the Federal Judge on November 25, along with a preliminary injunction that is still pending approval.
The TRO temporarily restrained Arkansas officials from executing two statutes, Act 636 of 2023 and Act 174 of 2024, aimed at enterprises and properties owned by nationals of China. Act 636 forbids ownership of property in the state by entities or individuals associated with the Chinese government as well as other nations deemed adversarial to the US.
In parallel, Act 174 forbids control of “foreign-party-controlled” interests linked to the nations identified in Act 636. These statutes empower the state agriculture department to scrutinize entities suspected of breaching these regulations and instruct the Attorney General to initiate action against them.
In light of these regulations, Arkansas Secretary of Agriculture Wes Ward referred the cryptocurrency mining firm to Attorney General Tim Griffin in December 2023, asserting that Jones Digital LLC, the former name of Jones Eagle, may have substantial connections to China.
Excerpt from Ward's correspondence to Attorney General Griffin. Source: Arkansas Advocate
The initiative to apply Act 636 and Act 174 against the mining enterprise rests on the owner’s Chinese background. Qimin “Jimmy” Chen, a Chinese-born individual residing in New York, oversees Jones Eagle through Eagle Asset Holdings Inc., which holds the majority share in the mining operation.
Nevertheless, court filings emphasize that Chen immigrated to the United States as a minor and is a naturalized citizen.
The TRO remains in effect for 14 days, after which a court session will occur to deliberate on the request for a preliminary injunction and potentially prolong the restraining order. Alex Jones, the attorney representing Chen, remarked:
The TRO and the preliminary injunction will avert further damage to our client as we get ready for a trial regarding the merits where we will comprehensively present our case on why the statutes are unconstitutional and indicative of legislative overreach.
Cryptocurrency Mining Firm Gears Up For Legal Contest
The cryptocurrency mining firm initiated a lawsuit on November 13 against the state of Arkansas, Ward, and Griffin, claiming a breach of the Fourteenth and Fifth Amendments of the US Constitution.
Jones Eagle's legal action against Arkansas state. Source: Arkansas Advocate
The lawsuit contends that the two statutes infringe upon the US Constitution by “denying due process, unlawfully discriminating against an individual based on national origin, and depriving the person of just compensation for the appropriation of property.”
In a declaration accompanying the firm’s TRO application, Chen asserts that he has sought to collaborate with state authorities but has not received a favorable response.
According to the report, Chen provided the attorney general with documentation demonstrating that the firm operates on leased property. Furthermore, he allegedly attempted to meet with the staff of the attorney general to present evidence of his US citizenship but “has been denied.”
Ultimately, Chen claims that the investigation was predicated solely on his Asian surname and asserts he filed the lawsuit because “he feels the attorney general is poised to take actions against his company that will further damage his business and reputation.”
Total market capitalization for cryptocurrencies is recorded at $3.16 trillion in the three-day chart. Source: TOTAL on TradingView
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