Byju's founders filed US lawsuit for more than $533 million transfer

Byju's Alpha, the US-based lending unit of the edtech company, stated on Thursday that it sued its co-founders Byju Raveendran and Divya Gokulnath, and ex-chief strategy officer and senior executive Anita Kishore in a US court. The lawsuit alleges that they conspired to create a scheme of fraud to transfer $533 million of loan proceeds - known as the "Alpha Funds" - out of the company without providing any consideration in return.

In a statement given to TOI, Raveendran refused the allegations saying they were "completely baseless and untrue". He stated, "This litigation is part of Glas' conspiracy to take over Byju's by all possible devious means. It is nothing but another gear in the wheel of falsehoods that Glas, the unlawful representative of disqualified lenders in the US, has been turning for long now." Glas Trust is the trustee to lenders to whom Byju's owes $1.2 billion.

Raveendran further said that a signed and attested affidavit filed in the Delaware court described the application of the full $1.2 billion loan "to the last dollar," and claimed the affidavit was "conveniently ignored" by Glas. He also charged FCPA violations by individuals connected to the lenders, including "Vishal Chanani of Redwood, Dan Ornstein of HG Vora, and Irena Goldstein of Glas," in relation to an alleged bribery scheme with an Indian court official. Raveendran said Glas is "already under investigation in a criminal case in India."

In the latest court filing seen by TOI, Byju's Alpha accused the three defendants of being part of a "lawless scheme" to siphon Alpha Funds from the debtor company to other group affiliates following the default on a $1.2 billion term loan by the company in 2022. The filing accused Raveendran of acting as the "self-appointed CEO" of Byju's Alpha of transferring the company's limited partnership interest in Camshaft Capital Fund worth more than $540 million to a non-guarantor affiliate, Inspilearn, on March 31, 2023, for nil consideration.