Nearly 300 complaints have been filed with the Federal Trade Commission (FTC) against the Bitcoin-miner makers at Butterfly Labs (BFL), according to documents Ars received from a Freedom of Information Act request.

In its short existence, Butterfly Labs has become one of the world’s most mysterious Bitcoin-related companies. For the past year, the Kansas-based manufacturing company has faced numerous accusations of fraud. Currently, the company is battling one lawsuit in federal court with more likely on the way. But Butterfly Labs previously lost a civil case by default in Kansas’ Johnson County Court in late November 2013. The plaintiff, a Californian named William Lolli, won a judgment of more than $13,000 but told Ars that he had not yet collected the award.

And in April 2014, court documents revealed that a Kansas federal judge told BFL’s co-founder Sonny Vleisides that his company had a “strong smell” of fraud about it during a probation hearing.

The FTC complaints come from locales as diverse as Estonia, Argentina, Redding (California), and Winnipeg (Canada). They all tell a similar story, describing orders made that were either never fulfilled or refund requests that were denied or not processed. Ars has made the full spreadsheet—complete with redactions made by the FTC—available here. An example of one complaint, from a customer in Orlando, is below:

I placed two orders for advanced computers on Feb 2nd 2013 for over $60,000 worth of computers. These computers are designed to generate revenue online. I was lead [sic] to believe April or May would be the shipping dates. However they never shipped my products and I requested a refund. I was given a partial refund as I agreed to wait an additional month. I received half my money back, however as of October I still did not have my products shipped and the company was refusing to refund me the remaining $30,000 they still owe me. Despite my [constant] requests for a refund and to cancel my order in its entirety they eventually shipped me a computer that was not what I originally ordered and worse yet it was broken on arrival and poorly constructed. I returned their broken computer and once more requested a refund. They still have not refunded me, they are ignoring me and I am unsure I can follow through with litigation as they are in [Kansas] and I am in Florida.

In total, there are 283 complaints. These begin in September 2012 and end in early April 2014, collectively detailing orders worth around $1 million. (This does not include one complaint alleging $30 million worth of fraud, which simply states: “The company has 30,000 customers and is likely a long con. Read this: https://bitcointalk.org/index.php?topic=110805.0 Then read this: https://bitcointalk.org/index.php?topic=247310.0”)

During testimony in the probation hearing referenced above, BFL’s chief financial officer, Bruce Bourne, said Butterfly Labs is expected to earn $25-$30 million in revenue in 2013. In an e-mail to Ars, Bourne said the company's goal is "100 percent customer satisfaction."

"If there is a problem, we try to resolve it," he said. "We have shipped over 50,000 miners to date and continue to ship and deliver these products with a return rate below two percent. Developing and producing hand-designed ASICs and Bitcoin miners takes time to do right, and we will only deliver products after they are tested and reliable. Our return rate bears out our commitment to excellence and to our customers."

Waiting on resolution

The new FTC complaints do not necessarily mean that customers will see their money back. The FTC only receives complaints and then, if it feels that the case is warranted, can bring litigation. In 2013 (PDF), the agency received over two million complaints, including more than one million fraud-related complaints worth $1.6 billion-plus in total.

“Complaints are used by FTC and partner law enforcement agencies to detect patterns of fraud and abuse, which may lead to investigations and eliminate unfair business practices,” Peter Kapland, an FTC spokesperson, told Ars. “They’re entered in the Consumer Sentinel database, which is used by many local, state, federal, and international law enforcement agencies. The FTC can’t resolve individual complaints, but we can provide information about what next steps consumers should take.”

Robert Flynn, the attorney representing Martin Meissner, a German-Polish man who brought a lawsuit against BFL in February, told Ars that he was frustrated to hear that so many others had bad experiences.

“We are disheartened every time we hear another person may have been victimized by Butterfly Labs, and we hope they are able to find redress for the harm they’ve suffered, just as we look forward to a jury holding Butterfly Labs accountable for its harm to Mr. Meissner,” he said.