Byju's Founder Ordered to Pay $1.07 Billion in US Bankruptcy Court Default Judgment

US Court Orders Byju's Founder To Pay Over $1 Billion After Default Ruling

Byju Raveendran has stated he will appeal the US court judgment and denies all allegations against him.

New Delhi:

A US bankruptcy court has mandated Byju's founder Byju Raveendran to pay more than $1.07 billion, holding him personally responsible for moving and concealing funds from Byju's Alpha, the company's US-based financing division.

Judge Brendan Shannon of the Delaware Bankruptcy Court issued the default judgment following Raveendran's consistent failure to appear before the court and provide requested documentation, according to various media sources.

A default judgment represents a court ruling made when a party fails to participate in legal proceedings or disregards court orders, allowing the case to be decided without proceeding to trial.

In response, Byju Raveendran has rejected all allegations and announced his intention to appeal the US court judgment. Raveendran claimed that the default judgment was issued with unusual speed, preventing him from presenting his defense.

"The Court, in our view, ignored relevant facts. Byju Raveendran must be allowed to present a defense and has been denied the right to do so by expediting the trial," a statement declared.

"The Delaware Court Judgment also fails to address that GLAS Trust knew the monies from the Alpha loans were not used by Byju Raveendran or any Founder of BYJU's for personal gain but were used for the benefit of Think & Learn Private Limited (TLPL)," the statement continued.

Byju's Alpha, established in Delaware in 2021, was created as a special-purpose vehicle to manage a $1.2 billion term loan from a group of global lenders.

The subsidiary operated solely as a holding entity for the loan proceeds without any actual business operations. Court filings revealed that $533 million was transferred from Alpha to Camshaft Capital, a small Miami hedge fund, and subsequently moved through affiliated entities including Inspilearn and later to an offshore trust, with no consideration returning to Byju's Alpha.