Jeff Pagliuca, left, and his client Mark Shin at Shin’s trial in Arapahoe County District Court in May 2023. (KDVR.com)
Lawyers for an Aurora man who exploited a software bug to take $9 million in cryptocurrency say that they haven’t been paid for helping him beat theft charges last year.
One day in summer 2020, Mark Shin noticed a flaw in the South Korean crypto network ICON that gave him 25,000 coins for free. He then repeated the process 557 times, generating nearly 14 million coins that were, at that time, worth about $9 million in U.S. dollars.
ICON seized some of Shin’s coins and alerted the FBI, which seized others. In 2021, a grand jury in Arapahoe County indicted Shin on charges of theft and money laundering. The case went to trial in May 2023 with Jeff Pagliuca of Haddon Morgan & Foreman representing Shin.
Pagliuca argued that the government and ICON were trying to scapegoat Shin for ICON’s mistake and that his client’s opportunism was not a crime, according to past coverage by FOX31. Jurors deadlocked after 10 hours of deliberation — FOX31 reported that they voted 10-2 to acquit — and a mistrial was declared. Prosecutors opted not to retry Shin.
“In advance of Mr. Shin’s trial, Mr. Shin was unable to pay for ongoing legal fees and costs,” Pagliuca wrote in an affidavit July 12. “Haddon Morgan & Foreman agreed to represent Mr. Shin with the mutual understanding that HMF would be paid at some point in the future.”
“It was anticipated that in the event of a successful outcome of the criminal action, the payment would be from Mr. Shin’s assets that had been seized,” the lawyer said.
But those seized assets, which Pagliuca now values at $14 million, still haven’t been released, so Shin, 32, hasn’t paid the law firm that kept him out of prison, according to a lawsuit that Haddon Morgan & Foreman filed against its former client in Denver District Court. The firm said it is owed $277,417 for its work and that Shin agrees the amount is fair.
Jeff Pagliuca is an accomplished defense attorney with Haddon Morgan & Foreman in Denver. (LinkedIn)
“Mark is a great guy and a great client,” Pagliuca said by phone Tuesday, stressing that last week’s collection lawsuit is not at all personal. “The assets are all tied up in litigation in California, so this is a necessary step in order to secure our right to payment out of the assets. I don’t want it to sound like Mark is somehow avoiding his responsibilities to us.”
In July 2023, a federal judge in California appointed a receiver to oversee the cryptocurrency and U.S. dollars that the FBI had seized. The judge was overseeing the case of Shin v. ICON, in which Shin was suing ICON for seizing some of his bug-generated coins.
Last month, U.S. District Judge William Orrick dismissed Shin’s claims against ICON.
“While the cryptocurrency context of this case makes it somewhat unique, the legal principles are clear cut,” he wrote. “Shin has no legitimate claim to exclusivity over the bug-generated cryptocurrency that he obtained contrary to the rules and practice of the network and no right to retain the benefit of his willful decision to exploit what he knew was a flaw.”
What that means for the assets seized by the FBI, which are separate from those seized by ICON, is not yet known. Orrick said he needs more time to decide the matter.
Pagliuca is an accomplished defense attorney with some noteworthy former clients, most recently Ghislaine Maxwell, the British socialite who is serving a 20-year sentence for child sex trafficking. In 2022, Haddon Morgan & Foreman sued Maxwell and her brother over unpaid legal bills and won a $1 million judgment against them in Denver District Court.
Jeff Pagliuca, left, and his client Mark Shin at Shin’s trial in Arapahoe County District Court in May 2023. (KDVR.com)
Lawyers for an Aurora man who exploited a software bug to take $9 million in cryptocurrency say that they haven’t been paid for helping him beat theft charges last year.
One day in summer 2020, Mark Shin noticed a flaw in the South Korean crypto network ICON that gave him 25,000 coins for free. He then repeated the process 557 times, generating nearly 14 million coins that were, at that time, worth about $9 million in U.S. dollars.
ICON seized some of Shin’s coins and alerted the FBI, which seized others. In 2021, a grand jury in Arapahoe County indicted Shin on charges of theft and money laundering. The case went to trial in May 2023 with Jeff Pagliuca of Haddon Morgan & Foreman representing Shin.
Pagliuca argued that the government and ICON were trying to scapegoat Shin for ICON’s mistake and that his client’s opportunism was not a crime, according to past coverage by FOX31. Jurors deadlocked after 10 hours of deliberation — FOX31 reported that they voted 10-2 to acquit — and a mistrial was declared. Prosecutors opted not to retry Shin.
“In advance of Mr. Shin’s trial, Mr. Shin was unable to pay for ongoing legal fees and costs,” Pagliuca wrote in an affidavit July 12. “Haddon Morgan & Foreman agreed to represent Mr. Shin with the mutual understanding that HMF would be paid at some point in the future.”
“It was anticipated that in the event of a successful outcome of the criminal action, the payment would be from Mr. Shin’s assets that had been seized,” the lawyer said.
But those seized assets, which Pagliuca now values at $14 million, still haven’t been released, so Shin, 32, hasn’t paid the law firm that kept him out of prison, according to a lawsuit that Haddon Morgan & Foreman filed against its former client in Denver District Court. The firm said it is owed $277,417 for its work and that Shin agrees the amount is fair.
Jeff Pagliuca is an accomplished defense attorney with Haddon Morgan & Foreman in Denver. (LinkedIn)
“Mark is a great guy and a great client,” Pagliuca said by phone Tuesday, stressing that last week’s collection lawsuit is not at all personal. “The assets are all tied up in litigation in California, so this is a necessary step in order to secure our right to payment out of the assets. I don’t want it to sound like Mark is somehow avoiding his responsibilities to us.”
In July 2023, a federal judge in California appointed a receiver to oversee the cryptocurrency and U.S. dollars that the FBI had seized. The judge was overseeing the case of Shin v. ICON, in which Shin was suing ICON for seizing some of his bug-generated coins.
Last month, U.S. District Judge William Orrick dismissed Shin’s claims against ICON.
“While the cryptocurrency context of this case makes it somewhat unique, the legal principles are clear cut,” he wrote. “Shin has no legitimate claim to exclusivity over the bug-generated cryptocurrency that he obtained contrary to the rules and practice of the network and no right to retain the benefit of his willful decision to exploit what he knew was a flaw.”
What that means for the assets seized by the FBI, which are separate from those seized by ICON, is not yet known. Orrick said he needs more time to decide the matter.
Pagliuca is an accomplished defense attorney with some noteworthy former clients, most recently Ghislaine Maxwell, the British socialite who is serving a 20-year sentence for child sex trafficking. In 2022, Haddon Morgan & Foreman sued Maxwell and her brother over unpaid legal bills and won a $1 million judgment against them in Denver District Court.
