The legal fight around Byju Raveendran reached a new peak after the Delaware Bankruptcy Court ordered him to pay $1.07 billion. The court announced this decision on November 20. Judge Brendan Shannon issued the order after a long period of missed hearings and ignored directions. The judge said the case showed a clear pattern of delay and confusion by the founder.
The default judgment came after Byju Raveendran did not follow several court instructions. The court asked for documents and appearances many times. Those directions went unanswered. Earlier, the judge even placed a daily fine of $10,000 on him. That fine has now grown into a very large amount.
The new judgment includes two major amounts. The first is $533 million linked to a fraudulent transfer of loan funds in 2022. The second is $540.6 million related to the transfer of interest in Camshaft Capital Fund. The court says these actions removed money from the reach of lenders and caused serious harm to the company’s US financing arm. This led to the heavy ruling.
The case started with a $1.2 billion loan raised in 2021 through Byju’s Alpha, a special unit created in the US. This unit had no business operations. It only held the loan amount. Soon after the loan came in, creditors claimed the startup defaulted. They also claimed that more than half a billion dollars moved into different entities without approval.
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Court documents show that $533 million first moved to Camshaft Capital, a hedge fund in Miami. After that, the money travelled again through a UK company. The final destination was a Singapore-based entity that links back to Byju Raveendran. Creditors say this path made the funds impossible to recover.
The judge said the case was “extraordinary” and added that strong action was needed. The court noted that earlier warnings and fines did not change the founder’s behaviour. The judge also said the founder lives in Dubai and shows no intent to follow the discovery rules.
Byju Raveendran rejected all the claims. His spokesperson said the ruling came too fast. They said the court did not allow enough time for a full defence. They also claim that none of the funds went for his personal use and that the money supported Think and Learn Private Limited. He plans to file an appeal soon.
The ruling adds more pressure to the troubled edtech company. Byju’s already faces cases in India. Those cases relate to insolvency matters and disputes linked to a sports sponsorship deal. The company also continues to face global legal trouble with lenders.
This default judgment now raises big questions about the future of the founder and the company. Creditors must now take steps in different countries to recover the amount. The appeal will decide whether the order stands or changes. For now, the ruling shows the huge fall of a company that once carried a valuation of $22 billion.