ConsenSys, a prominent Ethereum development company, is currently facing a shareholder vote over a controversial transfer of company assets. The dispute stems from allegations that ConsenSys executed a series of corporate maneuvers to transfer the company’s core assets, including products like Infura, PegaSys, Codefi, and MetaMask, from its original Swiss incarnation to a new American company formed in 2020. Former employees, who had been granted equity as part of their employment agreements, claim that this transfer devalued their shares.
Shareholder Vote and Independent Audit Intensify Legal Battle Over Asset Transfer
The former employees have been engaged in a legal battle with ConsenSys, and recent court rulings in Switzerland have given their case fresh momentum. The rulings have ordered an independent Swiss audit of the asset transfer and mandated a shareholder vote on the transfer of assets. The former employees argue that the transfer was illegitimate and are seeking to unwind it.
The shareholder vote, which took place recently, is expected to result in founder and majority shareholder Joseph Lubin rejecting the proposal to unwind the asset transfer. Despite this, the vote will allow the former employees to litigate the decision in a new legal proceeding. Additionally, a separate ruling by the High Court of Zug in Switzerland has ordered an independent audit of the transfer, with the findings expected to be revealed soon. ConsenSys disputes the claims made by the former employees and maintains that the transfer of assets was conducted properly, with involvement from reputable law firms and an independent valuation by PwC. The company argues that the current attempt to retrospectively revalue the assets is not how valuations work. The controversy surrounding ConsenSys centers on the valuation of the assets transferred and the alleged conflict of interest involving Lubin, who was a shareholder and potentially a director of both the original Swiss company and the new American company.
Former employees argue that the valuation of the assets was deliberately low, benefiting Lubin and minimizing their own equity value. They also claim that Lubin’s personal investment in the company, recorded as a loan, was not properly disclosed to all shareholders. The outcome of the shareholder vote and the ongoing legal proceedings will have significant implications for ConsenSys and its future.
Disclaimer: This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments. This is a news article only.
