BENGALURU: The Delaware Bankruptcy Court has entered a default judgment of more than $1.07 billion against Byju Raveendran, after finding that the edtech founder repeatedly failed to comply with court-ordered discovery in the Byju’s Alpha adversary proceeding.
A default judgment is a ruling issued when a party does not participate in the litigation or ignores court orders, allowing the court to decide the case without a trial.
The ruling, issued on November 20 and reviewed by TOI, awards $533 million in damages for what the court described as fraudulent transfer of Byju’s Alpha’s funds in 2022, and another $540.6 million tied to the transfer of the debtor’s interest in Camshaft Capital Fund, a US hedge fund.
The court also ordered Raveendran to provide a “full and accurate accounting” of the Alpha Funds and any proceeds that flowed from subsequent transactions.
Judge Brendan Shannon wrote that the relief granted was “extraordinary” but justified, citing what he called an “extensive and repeated pattern of delay and obfuscation.”
The order recounts multiple missed deadlines, incomplete filings, non-appearances, and non-payment of earlier sanctions, including a $10,000-per-day fine imposed in July for civil contempt.
The adversary case was brought by Byju’s Alpha Inc., the US unit currently in Chapter 11 bankruptcy, along with GLAS Trust, the loan agent that now controls the debtor.
They allege that more than half a billion dollars was “spirited away” from the company and routed through various entities beyond the reach of creditors. Raveendran has denied wrongdoing in earlier filings and has argued that discovery requests were improper or unnecessary; the court rejected those objections.
The judgment comes alongside a separate filing earlier this week in which the bankruptcy estate submitted a sworn declaration from UK businessman Oliver Chapman, describing how the disputed funds allegedly moved through his firm, OCI Limited, before being routed to a Singapore entity the debtor claims was linked to Raveendran.
That motion seeks court approval for a settlement with Chapman and marks the most detailed account yet submitted to the court on the alleged movement of the Alpha Funds.
Raveendran has denied the allegations. “We consider that the US Court erred in its judgment of this matter and will be filing the necessary appeals and other contestations related to this judgment and related orders," said a statement issued by his counsel, Lazareff Le Bars.
The statement argued that the ruling was “issued on an expedited basis” and that, in their view, the court “ignored relevant facts.”
It also contends that the default judgment “deprived Byju of the presentation of a defense,” asserting that he was not given adequate time to retain counsel or respond to accelerated deadlines.
The defense further claimed that “the monies from the Alpha loans were not used by Byju Raveendran or any founder for their personal gain but were used for the benefit of Think & Learn Private Limited (TLPL).”
It alleged that GLAS Trust “has been aware” of this, and accuses the lender-appointed agent of “misleading” the Delaware court.
Raveendran’s lawyers added that he and other founders are preparing US federal claims alleging “racketeering and obstruction of justice,” seeking not less than $2.5 billion in damages and said these actions will be filed “before the end of 2025.”
Get an chance to win ₹5000 Amazon Voucher by taking part in India's Biggest Habit Index! Take the survey here