Joseph Lubin, the founder and CEO of Ethereum infrastructure firm ConsenSys, is being sued by 27 former employees in a lawsuit filed in the New York Supreme Court on Wednesday. The ex-employees allege that Lubin violated a no-dilution promise regarding their equity shares made back in 2015.
The plaintiffs claim that their shares in Swiss-based holding company ConsenSys AG, formerly known as ConsenSys Mesh, were rendered worthless when Lubin transferred significant assets, including the MetaMask cryptocurrency wallet, to a new U.S.-based entity called ConsenSys Software Inc (CSI) in 2020. They further accuse JPMorgan (NYSE:JPM) of playing a key role in this asset transfer and becoming an equity holder in the new entity while keeping these negotiations secret.
The former employees allege that Lubin and others profited from their success, leaving them with depreciated shares due to asset loss in ConsenSys AG. They are seeking damages for six separate causes of action, including breach of contract, breach of fiduciary duty, fraud, and unjust enrichment. They are also demanding an impartial assessment of assets and asserting their rights to equity in CSI.
Despite these allegations, ConsenSys has dismissed the lawsuit as frivolous. Interestingly, the High Court of Zug ruled in favor of the plaintiffs. It's noteworthy that this lawsuit comes years after the launch of the Ethereum blockchain and at a time when ConsenSys recently raised $726.7 million from investors and is valued over $7 billion.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.