A lawyer representing Charlie Shrem, the Florida-based bitcoin entrepreneur who was recently sued by Winklevoss Capital Fund over an alleged theft from five years ago of 5,000 bitcoins, has now fired back in the lawsuit.

In a Monday court filing, Shrem's attorney, Brian Klein, wrote that WCF's allegations are "nonsense" and that his client "engaged in no wrongdoing. Period."

As Ars reported on Sunday, Shrem was released from prison in 2016 after he was convicted and served time for aiding and abetting an unlicensed money-transfer business by sending $1 million in bitcoins that ended up on the notorious drug website, Silk Road.

According to the new lawsuit—which was filed in federal court in Manhattan in September 2018 and only recently unsealed—WCF hired Shrem in late 2012 to purchase bitcoins on its behalf.

However, WCF alleges that, of the $250,000 sent to Shrem in the fall of 2012 for this purpose, only $189,000 was accounted for. The company now claims that Shrem pocketed the difference ($61,000) to "purchase 5,000 bitcoin for himself."

The investment firm is asking for the 5,000 bitcoins back, which at present exchange rates would be worth over $31.3 million.

Klein argues that WCF's arguments fail for two primary reasons: first, Shrem did not own the 5,000 bitcoins in question. As the then-CEO of BitInstant, Shrem was actually transferring them on behalf of a mysterious investor referred to as "Mr. X." It was this investor's bitcoins that Shrem claims he transferred into "cold storage," which is a way to preserve bitcoins in an offline wallet.

Second, WCF's lawsuit should have been brought under the relevant legal time limits of within two years of the discovery of the alleged fraud. Here, Cameron Winklevoss claimed in court papers that he "confronted" Shrem in January 2013.

The new filing was first reported on Tuesday by CoinDesk.

The two sides are set to appear in federal court in New York on November 8.