Bitcoin and Ethereum
Bitcoin is primarily designed to be an alternative to traditional currencies and hence a medium of exchange and store of value. Ethereum is a programmable blockchain that finds applications in numerous areas, including DeFi, smart contracts, and NFTs.
ConsenSys
ConsenSys is a blockchain technology company that offers developer tools alongside enterprise solutions. Their main goal is to enable developers, enterprises and even people on a worldwide scale to build next-generation applications and launch modern financial infrastructure while accessing the decentralized web.
NEWS
A group claiming to represent 35 former ConsenSys AG (CAG) employees has requested an audit under the Swiss Code of Obligations to investigate “serious irregularities” they allege occurred at the company during mid-2020.
CAG, also known as Mesh, is the company behind top Ethereum-based wallet provider MetaMask and was founded by Joseph Lubin, who is also the co-founder of Ethereum. “Joseph Lubin is the majority shareholder of both companies. The transaction was to the detriment of the minority shareholders of CAG and the benefit of Joseph Lubin personally,” the group alleged.
Swiss court Reveals The Fundamental Intellectual Property
According to a press release, the group of employees who claim to represent around 50% of all known shareholders submitted the request to a Swiss Court on March 1. The group alleged that “fundamental intellectual property and subsidiaries were illegally transferred” from ConsenSys AG (which it refers to as CAG) into a new entity called “ConsenSys Software Incorporated” (CSI) on Aug. 14, 2020.
Majority of Shareholders
The former employees also assert that they and other minority shareholders had no idea that the IP transfer had taken place, and claim that the deal was only conducted to benefit major shareholders and Lubin: “Joseph Lubin is the majority shareholder of both companies. The transaction was to the detriment of the minority shareholders of CAG and the benefit of Joseph Lubin personally.” The Washington-based company hit back in a statement suggesting the release was the work of one employee.
Legal Action on Press Release
“Mesh refutes the allegations underlying the legal action as well as those contained in the factually inaccurate press release that was self-authored by one of the former employees. Mesh looks forward to formally refuting the allegations and accusations in Swiss courts.”
According to the claims, the deal saw IP and subsidiaries transferred to “ConsenSys Software Incorporated (CSI), in exchange for 10% ownership of CSI and an offset of a $39 million loan by founder Joseph Lubin.”
JP Morgan Chase in MetaMusk and Ethereum
The deal was said to have resulted in top traditional financial institutions such as JP Morgan Chase acquiring stakes in MetaMask and Ethereum developer platform Ifura, while the intellectual property was used as a key drawcard to raise funding for CSI at a $3 billion valuation in 2021.
ConsenSys said the property transfer was valued fairly at the time, and that the landscape had changed dramatically since mid-2020 which is why the assets increased in value so much.
The Swiss court system acknowledged ‘Justice’
The group of employees is seeking for the “IP and subsidiaries to be returned to CAG” and is willing to battle out the matter in court to find a resolution: “We will push to seek justice through the Swiss court system. We are not interested in settling for less and we are ready for the upcoming court battles.”
The latest action against ConsenSys and Lubin comes just a few months after former general partner (GP) Kavita Gupta filed a lawsuit against the firm in New York alleging that it had failed to pay out the agreed carry percentage related to a fund she managed between 2017 and 2019.
ConsenSys Induced for The Fake Credentials
The dispute has since become embroiled in claim and counterclaim, with Consensys hitting back by filing a complaint in mid-January alleging that Gupta “fraudulently induced ConsenSys to hire her” via fake university degrees and work credentials.
Gupta then filed an additional complaint alleging that ConsenSys had engaged in “fraud, negligent misrepresentation and unjust enrichment” relating to the accusations against her.
Posting the court documents via Twitter on Feb. 3, Compass Mining content director and cryptocurrency journalist Will Foxley likened the back and forth to a “National Enquirer piece.”
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