Switzerland-based ConsenSys AG is in the midst of a growing storm as a legal dispute initiated by its former employees against its founder, Joseph Lubin, intensifies, making its presence felt in US courts. The main claim revolves around the allegation made by 27 former employees that Lubin, in collaboration with JPMorgan, orchestrated the transfer of essential assets from the Swiss entity to its US counterpart, ConsenSys Software Inc (CSI), established in 2020. Among the essential assets transferred is the notable crypto wallet provider, MetaMask.
M. Lubin had promised these early employees a stake in ConsenSys. Then he broke that promise. In doing so, he violated his commitments and legal duties. While Lubin became wealthy, the plaintiffs received nothing.
Lawsuit filing
Broken promises and private equity
The lawsuit, filed in the Supreme Court of the State of New York, argues that Lubin, renowned for his role as a co-founder of the Ethereum blockchain, not only transferred the main assets but also failed to recognize the early employees as equity stakeholders during the transition. The bulk of the complaint highlights Lubin’s alleged promise of equity to these founding employees, a promise said to have gone unfulfilled, leaving them with mere tokens instead of valuable equity. According to records, while ConsenSys thrived, securing investments totaling $726.7 million and boasting a valuation exceeding $7 billion, these early contributors found themselves with essentially “worthless pieces of paper.”
In defense, ConsenSys categorically denied these allegations. A representative of the company pointed out the plaintiffs’ unsuccessful efforts in Swiss courts over the past two years, suggesting that this move to the US legal system is merely a strategy to seek potential compensation. However, the narrative surrounding JPMorgan’s role remains shrouded in mystery, with their spokesperson choosing to remain tight-lipped on the matter.
