BENGALURU: Byju's term loan lenders have filed a lawsuit against founder Byju Raveendran, his wife and co-founder Divya Gokulnath and Anita Kishore (former chief strategy officer) in a US bankruptcy court.
The lawsuit was filed following the judgment of the US Bankruptcy Court for the District of Delaware against Riju Ravindran. The lawsuit claims that each of them co-orchestrated and executed a lawless scheme to "conceal and steal $533 million of loan proceeds".
The ad hoc group of term loan lenders of Byju's Alpha’s Term Loans said in a statement, “On the heels of the Delaware Bankruptcy Court’s recent judgment against his brother and companies, this action is being brought to now hold Byju Raveendran, the former CEO of Byju's Alpha, and two more of his co-conspirators – namely his co-founder and close business associate – accountable for their roles in masterminding the theft of more than half a billion dollars.”
It is clear that Byju, Divya, and Anita deliberately hid the assets of Byju's Alpha and repeatedly were deceptive about the location of the money in order to steal funds rightfully owed to the lenders, they said. "In light of the Court’s recent decision, there can be no doubt that they acted unlawfully and tried to cover their tracks, breaching fiduciary duties and making numerous misrepresentations, among other misconduct, in the process. If it is not abundantly clear to them by now, Byju and his cohorts will soon learn that the laws of the United States are immutable, and they can either choose to live the rest of their days as international fugitives or face the music and return the money they stole," they stated.
Meanwhile, the founders of Byju's in a statement said the allegations are fabricated and baseless.
"The allegations made by GLAS in the recent lawsuit are completely baseless and untrue. This lawsuit is a part of their conspiracy to wrestle control of Byju’s through all possible nefarious means. It is nothing but yet another cog in the wheel of lies that GLAS, the illegal representative of disqualified lenders in the US, has been rotating for a long time now," the founders added.
Raveendran said that a signed and verified affidavit submitted in the court of Delaware has the details of how the entire $1.2 billion loan was spent. "And yet, that affidavit was conveniently ignored and GLAS has continued to raise the question of the so-called missing $533 million repeatedly to mislead. They want to divert the attention by repeddling old news as now their conspiracy along with EY to sabotage the insolvency process of Think & Learn Pvt. Ltd. is becoming public," he and his wife added in the statement.
Recently, Raveendran in a post on X informed that an FIR was filed against the former resolution professional (RP) Pankaj Srivastava, Glas Trust and a few EY employees. "It is certainly no coincidence that this lawsuit was filed just days after the news of the FIR and public disclosure of the bribery video involving an Indian court official who has already admitted the fraud in his affidavit to IBBI. This is a serious FCPA (Foreign Corrupt Practices Act) violation requiring further investigation into the involvement of Vishal Chanani of Redwood, Dan Ornstein of HG Vora and Irena Goldstein of GLAS in the bribery scheme involving Pankaj Srivastava," the founders added.
GLAS, who is representing disqualified lenders Redwood and HG Vora, is already under investigation in a criminal case involving corruption and bribery charges in India, they further added.
Byju's Alpha is a Delaware special purpose financing vehicle established by Byju's to receive proceeds of a $1.5 billion Term Loan B. In mid-2022, it started transferring $533 million of the Alpha Funds to Camshaft Capital Fund. On February 1, 2024, Byju's Alpha filed for Chapter 11 bankruptcy.
In the lawsuit now, the lenders are seeking an award of damages for Byju’s breach of fiduciary duties, an award of damages for Byju’s, Divya’s, and Anita’s aiding and abetting of the breach of others’ fiduciary duties; an accounting of the Alpha Funds; an award of damages for conversion and civil conspiracy; reimbursement of all attorneys’ fees, costs, and expenses; and reimbursement of interest expenses.
