27 former employees of ConsenSys AG, a Swiss company specializing in Ethereum infrastructure development, have filed a lawsuit against the company’s founder and CEO, Joseph Lubin. They claim that Lubin broke his commitment to grant them equity in the company by transferring its valuable assets to a new US-based entity without their consent. According to the lawsuit, Lubin convinced the plaintiffs to join ConsenSys AG in 2014 with promises that the company would be the future of cryptocurrency and assured them that their equity would not be decreased. However, they allege that Lubin diluted their equity through corporate maneuvers in 2020.
The plaintiffs contend that with assistance from JPMorgan, Lubin transferred significant assets of ConsenSys AG to a newly-incorporated Delaware company called ConsenSys Software Inc. They claim that Lubin failed to disclose these transactions and neglected to include them as stakeholders in CSI. As a result, they were left with shares in ConsenSys AG that depreciated due to the loss of its primary assets.
ConsenSys has dismissed the allegations as “frivolous” and accused the plaintiffs of attempting to manipulate US courts after unsuccessful proceedings in a Swiss court. The plaintiffs are seeking damages for breach of contract, breach of fiduciary duty, fraud, unjust enrichment, and other claims. They are also demanding an impartial assessment of ConsenSys AG’s assets and liabilities while asserting their rights to equity in CSI.
This legal action comes at a time when ConsenSys is experiencing substantial success with a valuation exceeding $7 billion after raising $726.7 million from investors. The company is a leading player in the Ethereum ecosystem and develops blockchain-based products and services.
Hot Take: Former Employees Sue ConsenSys Founder Joseph Lubin Over Alleged Equity Breach
A group of 27 former employees from ConsenSys AG has filed a lawsuit against Joseph Lubin, accusing him of breaching his commitment to grant them equity in the company. The plaintiffs claim that Lubin transferred valuable assets to a new entity without their consent, resulting in the depreciation of their shares. ConsenSys has dismissed the allegations as frivolous and accused the plaintiffs of manipulating the US court system. The plaintiffs are seeking damages and an assessment of ConsenSys AG’s assets and liabilities. This legal action comes as ConsenSys experiences significant success in the Ethereum ecosystem with a valuation exceeding $7 billion.
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