Dubai-based Alibabacoin Foundation, the company behind the recently launched cryptocurrency Alibabacoin, is being sued by Chinese e-commerce giants Alibaba for trademark infringement.
According to papers filed in in US District Court in Manhattan, New York, Alibaba accused the creators of the coin of “prominent, repeated, and intentionally misleading” use of its trademarks with the intention of confusing consumers into thinking the cryptocurrency is related to it.
The second stage of Alibabcoin’s initial coin offering (ICO) was launched on March 16 and was slated to include 11 rounds with 10 days per round, according to company material.
It had already raised $3.5 million in funding – selling their target 50 million coins in the first round after just five days.
The coin cryptocurrency replaces personal keys with facial recognition technology, which offers more security than a traditional universal cryptocurrency wallet.
Alibaba Foundation was launched by Jason Daniel Paul Philip, a technology entrepreneur.
“Your participation in our ICO is not only about investing in a cryptocoin’s possible growth, it means you are helping the new innovation in the future,” he said last month.
“Our ultimate aim is to settle down as a new cryptocurrency method in this industry.”
The lawsuit seeks a halt to alleged further infringements, plus compensatory, punitive and triple damages for alleged violations of federal and New York law.
District Judge Kimba Wood issued a temporary restraining order and gave Alibabacoin until April 11 to explain why it should not be enjoined from further alleged infringements.
Alibaba is on the record as saying it has no plans to enter the cryptocurrency space.