Recent changes in technology and currency have not only altered the global economy, but they have also modified settlements and property division in divorce cases. This was demonstrated in a recent California case in which the court found that the husband violated the fiduciary duty he owed his wife as well as her interest in the community estate by failing to disclose information regarding his cryptocurrency investments. If you are in the process of determining whether to end your marriage, it is important to understand how the investments you and your spouse own may be evaluated, and you should consult a knowledgeable California divorce attorney regarding your rights.
Facts of the case
It is reported that in January 2013, the wife filed a petition for divorce and, along with the petition, served her husband with a restraining order that prohibited him from transferring, concealing, or disposing of any property, whether community or separate. In April 2013, the husband made three bitcoin-related transactions. Ultimately, most of his $45,000 were tied up in a bankruptcy action. He eventually recovered a small amount, and in his financial disclosures in February 2014, disclosed ownership of 1,062 bitcoins.
Allegedly, the court found the bitcoins to be community property and divided them equally between the spouses. Only after the wife sought to collect her half of the bitcoins was it disclosed that the remaining coins were tied up in bankruptcy. The value of the bitcoins had increased greatly at that time, and the original investment of $45,000 was now worth $8 million. The wife filed a motion to have half of the value of the bitcoins transferred to her and to grant her attorneys’ fees. The court granted the motion, finding that the husband breached the fiduciary duty he owed his wife. The husband then appealed.