Lawsuit: Adjourned lcn v. Blazora Corporation [2025] FCR 18

[Smallfries]

Case Filing

IN THE FEDERAL COURT OF THE COMMONWEALTH OF REDMONT
CIVIL ACTION


lcn (Represented by Dragon Law Firm)
Plaintiff

Spoiler: Proof of Representation

v.

Blazora Corporation
Defendant
Nexalin
Agent of the Defendant

COMPLAINT
The Plaintiff complains against the Defendant as follows:

Blazora Corporation (allegedly formerly known as Easy Corporation) has failed to pay out owed interest. At the time of writing, Blazora Corporation owes two months of interest to lcn, totaling $13,034.

In addition, Blazora has breached the implied contract between company and stakeholder, misrepresented its offer to the investing public and bondholders, committed fraud in the omission of supposed terms of the bond, fraudulently manipulated the market for its own gain, and authorized false and misleading advertising.

The wide range and high dollar value of these offenses, as well as the high public standing of the parties, has and continues to warrant a high level of scrutiny. As a matter of great public interest, President lcn humbly asks the court to observe this case as the highly volatile and important case that it is, and take this as an opportunity to set precedent and greatly disincentivize fraudulent, contract-breaching, and otherwise anti-social or outrageous behavior that is destabilizing to the general welfare.

I. PARTIES
1. Lcn (Plaintiff & Bondholder)
2. Nexalin (Agent of Defendant)
3. Blazora Corporation (Defendant)

II. FACTS
1. On 23 September 2024, Nexalin founded Easy Corporation and listed a bond with a face value of $1,000,000 on The Exchange, a stock exchange hosting several business ventures and entities based in Redmont. This bond was listed under the CUSIP number “EZC24-6M”. (P-004)

2. On 25 September 2024, lcn purchased 931 shares of this bond in five separate transactions at a market price of $39,299.56. The bonds have a face value of $100 each, totalling $93,100. (P-001–003) The bonds held a monthly interest rate of 7.0% and were said to have a maturity date of 1 January 2025. The official issuing date was 1 October 2024. (P-004)

3. On 5 November 2024, lcn privately dm’d Nexalin to ask for interest to be paid. Nexalin responded simply with, “Yeah.” Interest was not paid. (P-005)

4. After all of October and November passed without payment, on 15 December 2024, lcn publicly asked in The Exchange general chat: “@nexalin interest plz #ezc24-6m,” to which Nexalin quickly replied, “Will go out today.” Interest was not paid. (P-006)

5. Later that day, an announcement from Exchange CEO Stoppers (presumably at the behest of Nexalin) said that Easy Corporation “Has been taking aggressive steps to prepare for launch,” and they “Plan[ned] to launch by summer 2025.” (P-015)

6. On 16 December 2024, an announcement from Exchange CEO Stoppers (presumably at the behest of Nexalin) reached out to officially begin a bondholder’s vote as to the matter of extending the bond’s interest payments by six months. (P-010)

7. On 22 December 2024, Nexalin filed a Corporation Registration for Blazora Corporation. (P-016) The documents of this incorporation do not list Easy Corporation in any capacity, nor is there any office announcement on the Easy Corporation (now Blazora Corporation) discord server or the Easy Corporation bond (now Blazora Corporation bond). (P-018, showing that the server had a message dated 23 September 2024 when Easy Corporation was made, and an unedited information bulletin proving the server was originally Easy Corporation; P-019, showing the Blazora discord's announcements channel, with no announcement of the switch from Easy Corporation to Blazora)

8. On 30 December 2024, an announcement from Exchange CEO Stoppers (presumably at the behest of Nexalin) said that the previous vote to extend the duration of the bond had passed, and it would be extended for six months. At this time, Stoppers also announced that “[The] bond and the issuing company (Easy Corporation) have both been named to Blazora.” (P-010) Nowhere in the publicly shown terms for the bond was this shown to be a potential option. (P-004) Approximately ten minutes later, the first (of nine) interest payments were paid out. (P-007)

9. On 31 December 2024, a conference room within Dragon Law Firm was created to ask the Defendant’s agent, Nexalin, to resolve the breach of contract up to that point. Nexalin did not respond. (P-014)

10. On 2 January 2025, an attorney for lcn made an official demand for relief, stating lcn’s willingness to resolve the matter amicably if: (1) immediate payment of all overdue interest was met, (2) a formal explanation of the delays and assurance of compliance going forward was provided, and (3) reimbursement of lcn’s legal fees. Nexalin did not respond. (P-014) Later that day, Exchange CEO Stoppers announced that Blazora Corporation had officially paid its second of nine interest payments. (P-012, P-008)

11. On 6 January 2025, the attorney representing lcn pinged Nexalin. Nexalin responded with, “We are all caught up on bond payments.” The attorney responded, “No, you are still missing the bond payment for the first of January.” Nexalin did not respond, but instead left the discord. (P-014)

12. Later that day, Exchange CEO Stoppers posted that the reason for the failure to pay the third owed month was that the bond’s terms gave them the right to disallow interest to be charged in October, with the first month where interest would be accrued being November. The above terms were provided in the form of a screenshot to a restricted channel, and dated to 23 September 2024, when the bonds were first listed. These newly revealed terms also said that interest will be paid at the end of each month, and that the bond term was to last from 1 October 2024 to 31 March 2025, a period of six months. This is contradictory to the listing information, which said the bond would mature on 1 January 2025. The Exchange claimed they would “[Take] full responsibility for any inconvenience caused by our failure to adequately communicate these terms.” (P-011, P-009)

13. As of 13 February 2025, neither the interest payment for the Month of January, due 31 January 2025 according to the newly revealed terms, nor the fourth interest payment (presumably for October) has been paid. (P-017, showing the final discord announcements for the bond.) lcn still holds their 931 bond shares. (P-013)

III. CLAIMS FOR RELIEF
1. lcn and Defendant entered into an implied contract upon the purchase of the bonds. According to the Contracts Act § 4, the five elements necessary to enter into a contract are: (a) Offer, (b) Acceptance, (c) Consideration, (d) Intent, and (e) Capacity. Contracts do not need to be written out expressly, but can be implied. According to § 6 of the Act, a contract that meets those requirements is valid and enforceable. According to § 7 of the Act, a breach of contract may result in remedies of damages, specific performance, or other equitable relief. The implied contract between the seller and the buyer of bonds listed publicly on an exchange promotes clarity of terms and—most importantly—a promise to pay interest on those bonds. This promise has been broken, and Blazora has breached as a matter of law.

2. Four full months have elapsed since lcn purchased the bond shares. Under the publicly presented terms of the bond, four months of interest should have been paid as of 13 February 2025. Only two have been paid, in late December and early January. Two more months are owed.

3. According to the Contracts Act § 8, Misrepresentation “Happens when a false statement induces another party to enter into a contract.
. . .
Remedies for misrepresentation may include rescission, damages, or other appropriate relief." lcn was induced by false public statements authorized by Blazora in the publicly presented bond terms at the time of purchasing the bond shares.

4. According to the Commercial Standards Act § 6, Fraud is the “Intentional or reckless misrepresentation or omission of an important fact . . . to a victim who justifiably relies on that misrepresentation; and the victim . . . suffered actual, quantifiable injury or damages as a result of the misrepresentation or omission.” This carries a fine of up to $10,000 plus damages. lcn was damaged by fraud when they justifiably relied upon a misrepresentation and made financial decisions with that misrepresentation in mind.

5. According to the Commercial Standards Act § 6, False Advertising is “The act of authorizing a false advertisement for publication.” The maximum fine for this offense is $5,000. lcn was damaged by the false advertisement authorized by Blazora, advertising their bonds as more valuable than they truly were through the omission of unfavorable terms to potential bondholders.

6. According to the Commercial Standards Act § 6, Misleading Advertising is “The act of authorizing a misleading advertisement for publication.” The maximum fine for this offense is $5,000. lcn was damaged by the misleading advertisement authorized by Blazora, misleading them into believing the bonds would mature at a certain date and would have a certain and specific amount of interest payments granted by that date.

7. According to the Commercial Standards Act § 8, Market Manipulation is “The act of fraudulently inflating or deflating the value of a company or asset of which you have a responsibility for.” This carries a fine of up to $10,000 plus damages. In Blazora's act of manipulating the market through the omission of key facts in their public terms which would lower the fundamental value of the asset, lcn was damaged as they were induced to purchase that inflated asset.

IV. PRAYER FOR RELIEF
The Plaintiff seeks the following from the Defendant:

1. $16,526.06 of compensatory damages as a direct result of the breach of contract, following Blazora Corporation’s failure to pay two months of interest, further includes the combined future value of each of the two months where no owed interest was paid, if lcn had received and then reinvested the interest at the time of their payment. Calculated by taking the amounts owed, multiplying each by the formula "x * (1.07)^t", where x is the interest per month owed and t is the amount of time in months from the first two missed payments to now (October and November, four and three months respectively), and adding them together.

2. $25,000 of punitive damages due to Misrepresentation by Defendant as defined by the Contracts Act. $5,000 for each time lcn and Defendant entered into a contract through the former’s purchase of bonds due to misrepresentation(s) made by Defendant.

3. $50,000 of punitive damages due to Fraud by Defendant as defined by the Commercial Standards Act. $10,000 for each of the five times lcn justifiably relied upon a misrepresentation(s), and lcn suffered actual, quantifiable injury.

4. $5,000 of punitive damages due to False Advertising by Defendant as defined by the Commercial Standards Act. $5,000 for each time Defendant authorized a false advertisement for publication.

5. $5,000 of punitive damages due to Misleading Advertising by Defendant as defined by the Commercial Standards Act. $5,000 for each time Defendant authorized a misleading advertisement for publication.

6. $10,000 of punitive damages due to Market Manipulation by Defendant as defined by the Commercial Standards Act. $10,000 for each time Defendant fraudulently inflated or deflated a company or asset of which they had a responsibility for.

7. $100,000 of punitive damages due to the Defendant’s flagrant, obscene, and outrageous violation impacting the officeholder of the most powerful position in the nation that so shocks the conscience and is so monstrous in orchestration that no reasonable person could see it as anything except manifestly against the public interest, requiring sharp and steep correction. Blazora has had several reminders of the owed interest, has not attempted any dialogue, and has totally refused any attempt at negotiation. This brazenly fraudulent and outrageous act towards an upstanding citizen and highly regarded politician indicates that individuals with less ability for legal action than lcn may face similar outrageous behavior, and it is the responsibility of the court to correct this injustice through harsh punitive damages. The naked and unashamed abuse of economic power in a poorly regulated field must not be tolerated. Taken as a whole, these punitive damages are not just about punishing Blazora and restitution for lcn, but to send a clear and firm message that financial misdeeds are not tolerated within our legal system, and that the average citizen can feel safe investing in the future of Redmont.

8. $63,457.82 in legal fees as stipulated by the Legal Damages Act § 9.

V. EVIDENCE

Spoiler: P-001

Spoiler: P-002

Spoiler: P-003

Spoiler: P-004

Spoiler: P-005

Spoiler: P-006

Spoiler: P-007

Spoiler: P-008

Spoiler: P-009

Spoiler: P-010

Spoiler: P-011

Spoiler: P-012

Spoiler: P-013

Spoiler: P-014

Spoiler: P-015

Spoiler: P-016

Spoiler: P-017

Spoiler: P-018

Spoiler: P-019

By making this submission, I agree I understand the penalties of lying in court and the fact that I am subject to perjury should I knowingly make a false statement in court.

DATED: This thirteenth day of February 2025

 

[Dartanboy]

Writ of Summons

@Nexalin or a legal representative of Blazora Corporation is required to appear before the Federal Court in the case of lcn v. Blazora Corporation [2025] FCR 17.

Failure to appear within 72 hours of this summons will result in a default judgement based on the known facts of the case.

Both parties should make themselves aware of the Court Rules and Procedures, including the option of an in-game trial should both parties request one.

 

[Nexalin]

Present

 

[Dartanboy]

Note: There was an error - this case is FCR 18, not FCR 17.

 

[Dartanboy]

Present

Please file an Answer to Complaint within 72 hours.

 

[Smallfries]

Motion

IN THE FEDERAL COURT OF THE COMMONWEALTH OF REDMONT

MOTION FOR SUMMARY JUDGMENT



The plaintiff moves that the complaint in this case be awarded summary judgment, and in support thereof, respectfully alleges:



The Defendant has had 72 hours to submit an answer, and has failed to do so or request an extension.



This lack of an answer means there are no denials of any of the Plaintiff's allegations or facts.



The lack of denial means there are no facts in dispute.



As there are no facts in dispute, as a matter of law the Court should direct the verdict for the Plaintiff.

 

[Dartanboy]

This court is now in recess until Summary Judgement is delivered.

 

[Dartanboy]

I also find Nexalin in Contempt of Court for failing to provide an Answer, if this is his first or second offense, the DHS should fine/jail him as prescribed by law. If it is the third or later, a $500 fine suffices.

 

[Dartanboy]

I apologize for the delay. I've been sick IRL.

 

[Dartanboy]

This carries a fine of up to $10,000 plus damages. In Blazora's act of manipulating the market through the omission of key facts in their public terms which would lower the fundamental value of the asset, lcn was damaged as they were induced to purchase that inflated asset.

Could the Plaintiff please explain to me how the value of the bond was inflated? Please answer within 48 hours.

 

[Smallfries]

Could the Plaintiff please explain to me how the value of the bond was inflated? Please answer within 48 hours.

Of course, your honor.

May it please the court, the plaintiff would like to share some graphs and some elementary economics.

Spoiler: Basic Economics

Market forces—the sum of supply and demand—are the base for which all prices are determined, whether the item in question is a gold block, a signed head, shares of a company, or indeed, shares of a bond. Put simply: there is a limited amount of supply and a theoretically infinite amount of demand, and the mathematical lines for these two sides of the economic equation meet at a specific quantity, Q, and a price, P, which is called the "market equilibrium." Below you can see an example.

Spoiler: P-020

This graph is a very basic market equilibrium graph, typically the first an economic student will lay their eyes upon. The curve that ends at the bottom right, labelled "D-0," is the initial demand "curve," and the curve that ends at the top right, labelled "S-0," is the initial supply "curve." Where these two curves intersect, labelled "E-0," or initial equilibrium, corresponds along the X-axis (Quantity) to the quantity point "Q-0," and along the Y-axis (Price) to the price point "P-0."

Altogether, this graph represents a very basic and simplified understanding of how the price of goods work. Along a give supply or demand curve, you can see along the price axis that the seller(s) in this case would be very willing to sell many more of this good at a price higher than P-0, but consumers would be willing to buy many less at that price. The equilibrium point represents the moment in the market where demand and supply intersect, where there is an equilibrium between what the sellers are willing to sell at the given price and the buyers are willing to buy at a given price.

Spoiler: P-021

This is a similar graph (ignore that the lines are now curved, it does not matter for our purposes). Here, however, we only have the demand curve, there is no supply curve to simplify what I am trying to show. What we can see between these two curves—D-1 moving to D-2—is that a decrease or left shift in the curve reduces the price at which consumers are willing to purchase the same amount of goods, or, a reduction in the amount of goods consumers are willing to purchase at the same price. The lines going down, Q-1 and Q-2, show this.

Spoiler: P-022

This graph shows the opposite, where the demand curve increases (or shifts right). At the same price level, consumers are willing to buy more of a good, or are willing to buy the same amount of a good at a higher price level.

Both demand and supply curves shift for a number of reasons. It is important to note that demand curves shifting do not mean people want to buy more things; but that they are willing to buy the same amount of things more. Consumers do not have an infinite amount of money, and must choose where they spend it. A rightward (increasing) shift in the demand curve represents the consumer being willing to give up more of their budget for that good or service or property.

To apply these thoughts to our case, we need to show one more graph:

Spoiler: P-023

This graph shows the supply curve for a good, service, or property which no matter how high or low the price is the seller is will not (and cannot) change the amount supplied. Common examples in real life include land, societal positions with a fixed number of officeholders, and pre-determined shares of a stock, company ownership, or bonds.

The question here is: How was the price of the bond inflated, and how did Easy Corporation (allegedly Blazora Corporation) benefit from it?

Simply put, by falsely and misleadingly telling the investing public that interest would be paid for the month of October, more people were willing to pay a higher price as a matter of economics, and any reasonable person would agree.

The Defendant has failed to respond to any allegations and listed evidence in the initial complaint, and as a matter of law lcn is entitled to Summary Judgment. As a further consequence of failing to respond to any of the listed allegations, Defendant has tacitly acknowledged all of the allegations from lcn as fact.

Thus, Defendant does not contest—and it cannot be contested—that the public terms of the bond held that the month of October would be a month where interest payments would be made. The Defendant further does not contest—and it cannot be contested—that the hidden agreement, which the Defendant made no effort to publicly reveal until months after the fact, explicitly removes the month of October from receiving interest.

In this case, the sale of bonds by Easy Corporation (allegedly Blazora Corporation) is accompanied by a supply curve that is perfectly inelastic as P-023 shows; there are a set number of bond shares at the very beginning of the sale, and no more or less can be created, no matter what the market price may be. Shares of a bond traded on the market are not like blocks of gold or emeralds, they cannot be created or produced after the bond is introduced; they are opened for the public to invest in at a specific quantity, and that is it. Suppose for a moment that the equilibrium price of one share of this bond is $50. It stands to reason, then, that the price of the bond could only reach $60 if the demand went up, and $40 if the demand went down (due to the supply of the bond being fixed at Q-0).

Spoiler: P-024

If before the bond is released to the public, but after the initial terms are revealed, the bond issuer says that they will raise the interest of the bond from 7% to 8% then the demand will rise, as investors will be willing to spend more of their limited budgets on the bond due to its increase in worth. Thus, the price of the bond will increase, as shown in the graph above. This makes sense intuitively, as investors would of course be willing to pay more money to receive an asset that would in turn pay them more money.

However, if instead the bond issuer were to say that out of the three months the bond would be active, one of the three months would receive no interest—effectively cutting the interest rate by 33%, or to roughly 4.6%—it clearly holds that the demand, and thus the price, of the initial bond offering would go down. This also makes sense intuitively, as investors would be willing to pay less for an asset that pays so little back to them. It is foolish and unreasonable to think that an investor would be willing to pay the same price for an asset with a 4.6% and a 7% interest rate.

With all of this in mind, it is clear that in failing to disclose the disclaimed one out of three interest payments that Easy Corporation (at the time, now allegedly Blazora Corporation) set out in their hidden terms, the Defendant acted in a manner that avoided lowering the value of the bond to where it naturally would have been. By doing this, the Defendant artificially inflated the value of the bond, and thus the amount of money they received in its public offering.

lcn argues that this omission of one month less of interest on the bond was market manipulation which (until the filing of this lawsuit) was a gamble that the Defendant seemed to be winning. Besides being a crime, market manipulation also deprives hard-working citizens of their money and unjustly enriches those that usually are already extremely rich, as is undoubtedly the truth in this case.

lcn asks the court to consider the massive amount of wealth the Defendant and its agent possesses in awarding damages both compensatory and punitive, and prays that the court will see the reasoning that this fraudulent mode of operation must be greatly financially punished, or Defendant—and others—will repeat the behavior.

 

[Dartanboy]

Verdict

IN THE FEDERAL COURT OF THE COMMONWEALTH OF REDMONT
VERDICT
lcn v. Blazora Corporation [2025] FCR 18

I. PLAINTIFF’S POSITION
1. Blazora Corporation (formerly Easy Corporation) entered a contract with the Plaintiff by offering a bond on the Exchange and the Plaintiff purchasing 931 shares of it.
2. Blazora has failed to pay interest multiple times.
3. According to the Plaintiff, this is Breach of Contract.
4. The Plaintiff was not informed of the potential for the Bond to be extended or renamed, and the value of the bond was artificially inflated.
5. According to the Plaintiff, this is a Misrepresentation, Fraud, False Advertising, Misleading Advertising, and Market Manipulation.

II. DEFENDANT’S POSITION
1. The Defendant failed to respond to the lawsuit

III. THE COURT OPINION
I am disappointed in the Defendant’s failure to answer the complaint in this case, as it puts more work on me. Nonetheless, here is the opinion:

There is no doubt that, in the court’s opinion, an offering of any stock, bond, fund, or similar in a Stock Exchange constitutes a contract once accepted. Certainly, therefore, if the bond’s terms require interest to be paid every month, it must certainly be paid out every month. To the Plaintiff, there was not even the slightest indication that there would not be any interest paid for the month of October, thus, certainly the failure to do so is a Breach of Contract. That said, the maturity date of the bond was January 1, exactly 3 months from the issue date of October 1, so I only see one missing payment, not two.

But this is only a piece of the dispute at hand. The remaining portion requires far more analysis. The allegations of the Plaintiff include Misrepresentation (“when a false statement induces another party to enter into a contract”), Fraud (“intentional or reckless misrepresentation or omission of an important fact … to a victim who justifiably relies on that misrepresentation”), False Advertising (“authorizing a false advertisement for publication”), Misleading Advertising (“authorizing a misleading advertisement for publication”), and Market Manipulation (“fraudulently inflating or deflating the value of a company or asset of which you have a responsibility for”). For simplicity’s sake, I’ll be addressing these in the same order they are listed here.

A Misrepresentation occurs when a false statement induces another party to enter into a contract. As already mentioned, the court is satisfied that Blazora Corporation and lcn entered into a contract. The Plaintiff contends that Blazora misrepresented the terms of purchasing the bond, which induced lcn to purchase 931 shares. The Federal Court is satisfied with this argument as well.

Fraud occurs when there is an intentional or reckless misrepresentation or omission of an important fact and the victim suffers actual quantifiable injury. It is already established that the terms of the bond were misrepresented, and it takes no deep analysis to realize that lcn paid money for their shares of the bond, which is certainly a quantifiable injury.

False Advertisement occurs when there is a false advertisement. For the same reasons as the bond was misrepresented, the court is satisfied that there was a False Advertisement.

Misleading Advertisement occurs when there is a misleading advertisement. For the same reasons as the bond was misrepresented, the court is satisfied that there was a Misleading Advertisement.

Market Manipulation occurs when a company or asset’s value is fraudulently inflated or deflated, which by misrepresenting the amount of interest to be paid out, seems to have occurred here.

IV. DECISION
The Federal Court rules in favor of the Plaintiff, and awards:
1. $8,263.03 in Compensatory Damages for Breach of Contract
2. $25,000 in Punitive Damages for Misrepresentation (5 * $5,000)
3. $50,000 in Punitive Damages for Fraud (5 * $10,000)
4. $5,000 in Punitive Damages for False Advertising
5. $5,000 in Punitive Damages for Misleading Advertising
6. $10,000 in Punitive Damages for Market Manipulation
7. $100,000 in Punitive Damages for the Defendant’s reckless disregard for the law and refusal to seek any sort of remedy for their actions.
8. $30,489.45 in Legal Fees (15% of the value of the case – Summary Judgement, but was quick and thorough in responding to my additional inquiry).

In total, the Department of Homeland Security shall ensure Blazora Corporation pays $203,263.03 to lcn (damages) and $30,489.45 to Dragon Law Firm (legal fees).

Note that this verdict shall not be construed as finding the Defendant or its agent(s) criminally guilty for any actions in this case.