The Record-Breaking $152 Million Battle Over Blockchain Betting Tool Augur

In a civil lawsuit, Matthew Liston, 26, has taken four Augur associates to court, alleging that angel investor Joseph Ball "Joe" Costello, 64, and three other founding members, Jack "John" Peterson, 35, Joseph Charles "Joey" Krug, 22, and Jeremy Gardner, 26, committed fraud, breach of contract, and trade theft in connection with conflicts that arose out of Liston's termination from the company and his stake in Augur's token distribution, leaving him empty-handed.

Liston is seeking $38 million in general damages and $114 million in punitive damages for a total of $152 million in collective damages - more than one-quarter of REP's market value.

Disputing the extent of Liston's role in the project, Krug went on, "There hasn't been a single GitHub commit by Liston, on any of the Augur repositories. He's not a founder of Augur."

Motivated to build, market, and fund the technology on the Truthcoin model after getting the all-clear from Peterson and Costello, Liston says he then hired Krug and Gardner, the latter of whom conceived the Augur brand name, as well as a software engineer, Zackary "Zack" Hess, who had been working on his own implementation of Truthcoin.

The lawsuit finally alleges that Peterson's refusal to honor Liston as an Augur co-founder as both parties had agreed upon furnishes supplementary proof that Liston had been deceived in the contractual back-and-forth.

Over a year later, when Liston started working as chief strategy officer for a decentralized ethereum application similar to Augur called Gnosis in 2017, Peterson reached out to Liston's boss at Gnosis, to "Try to convince him to lean on Plaintiff Liston to stop referring himself as a co-founder of Augur."

Shortly thereafter, an unnamed Augur employee emailed FOAM chief executive officer Ryan John King, whose company Liston advises, "Using aggressive and disparaging language demanding that FOAM remove the phrase 'Augur cofounder' from Liston's description on FOAM's website."

Sztorc, who wrote a critical expose of Augur in December 2015, told CoinDesk that he sympathizes with Liston, noting the unexpected medical condition of Liston's ex-girlfriend when he was abruptly let go.

While the lawsuit doesn't specify the nature of the disagreements that took place, a source familiar with the matter said that Liston had originally wanted to construct Augur on top of the ethereum blockchain to process predictions more efficiently, but his advice was initially shunned in favor of the bitcoin blockchain.

"[Liston] ended up being right," the source said, pointing out that Augur ultimately switched from the original blockchain to its second-generation successor after Liston departed.