Byju’s Alpha Files Lawsuit Against Byju Raveendran and Divya Gokulnath in US Court for Alleged Theft of $533 Million

New York/New Delhi, April 10 (NationPress) Byju’s Alpha, a specialized financing entity set up by Byju’s in the United States to manage proceeds from a $1.5 billion Term Loan B, has initiated legal action against Byju Raveendran, the co-founder, and his spouse Divya Gokulnath for allegedly "orchestrating the theft of $533 million".

According to Byju's Alpha, following the $533 million ruling by the United States Bankruptcy Court for the District of Delaware against Riju Ravindran and Byju's parent firm in India, the entity has now brought forth a lawsuit against Byju Raveendran, his co-founder and wife Divya Gokulnath, and his advisor, Anita Kishore.

The lawsuit claims that all parties were involved in a scheme to conceal and misappropriate $533 million of loan proceeds, referred to as the 'Alpha Funds', as stated in a press release.

“In light of the recent Delaware Bankruptcy Court ruling against his brother and associated companies, this lawsuit aims to hold Byju Raveendran, the former CEO of BYJU’s Alpha, along with two of his accomplices – his co-founder and a close business associate – responsible for their involvement in the misappropriation of over half a billion dollars,” remarked the ad hoc group of lenders associated with Byju’s Alpha’s Term Loans.

They further asserted, “It is evident that Byju, Divya, and Anita intentionally concealed the assets belonging to BYJU’s Alpha and were consistently deceptive regarding the whereabouts of the funds to wrongfully seize money owed to the lenders.”

“Given the court's recent ruling, it is unmistakable that they acted unlawfully and attempted to erase their misdeeds, violating fiduciary duties and making numerous misrepresentations. If it is not clear to them by now, Byju and his associates will soon realize that U.S. laws are unwavering, and they must either live as fugitives or return the stolen funds,” stated the ad hoc group of lenders.

Beginning in March 2022, just months after acquiring the Term Loans, Byju’s Alpha, under the influence of the Byju’s organization, defaulted on its credit agreement.

In April, Byju purportedly commenced the first of several systematic and illegal transfers of the Alpha Funds. Byju’s Alpha, along with Byju and his brother Riju Ravindran, admitted to defaults by entering into numerous amendments and forbearances concerning the credit agreement.

“In an effort to cover their tracks, Byju, Divya, and Anita repeatedly misrepresented and contradicted their statements regarding the utilization and whereabouts of the $533 million Alpha Funds,” the press release indicated.

On March 15, 2024, Byju’s released a statement in response to a preliminary injunction issued by the Delaware Bankruptcy Court, which froze the Alpha Funds, barring any further usage or transfer.

In this statement, Byju’s claimed that “the funds are securely held within one of our subsidiaries and, in accordance with the court's order, they will rightfully remain there.”

On October 9, 2024, Byju provided an oath to the Delaware Bankruptcy Court asserting that the Alpha Funds had been expended.

In its lawsuit, Byju’s Alpha seeks damages for Byju’s breach of fiduciary duties; damages for Byju’s, Divya’s, and Anita’s complicity in breaching others’ fiduciary duties; an accounting of the Alpha Funds; damages for conversion and civil conspiracy; reimbursement for all legal fees, costs, and expenses; reimbursement of interest expenses; and any other relief deemed just and appropriate by the court.