Daijiworld Media Network- New Delhi
New Delhi, Apr 10: In a dramatic legal escalation, Byju’s Alpha, a special purpose financing arm of Indian edtech major Byju’s, has filed a lawsuit in a US court accusing company co-founder Byju Raveendran, his wife and fellow co-founder Divya Gokulnath, and top advisor Anita Kishore of orchestrating the unlawful diversion of $533 million.
The suit, filed in the United States District Court following a ruling by the Delaware Bankruptcy Court, comes in the wake of a $533 million judgment against Riju Ravindran — Byju’s Raveendran’s brother — and the company's ultimate parent entity in India. The financing vehicle, set up to receive proceeds from a $1.5 billion Term Loan B, alleges that the accused engaged in a "lawless scheme" to conceal and misappropriate these funds, termed internally as the ‘Alpha Funds’.
An ad hoc group of lenders to Byju’s Alpha stated in a press release:
“On the heels of the Delaware Bankruptcy Court’s recent judgment, this action seeks to hold Byju Raveendran, Divya Gokulnath, and Anita Kishore responsible for their roles in masterminding the theft of more than half a billion dollars.”
The lenders further alleged that the accused deliberately obscured the trail of the Alpha Funds, engaged in deceptive conduct about the funds’ whereabouts, and breached fiduciary duties through a series of calculated misrepresentations.
“If it is not abundantly clear to them by now,” the lenders stated sternly, “Byju and his cohorts will soon learn that the laws of the United States are immutable. They can either choose to live the rest of their days as international fugitives or return the money they stole.”
According to the lawsuit, Byju’s Alpha began defaulting on its credit agreement as early as March 2022 — mere months after receiving the funds. By April of that year, the company, then under the control of the Byju’s group, allegedly began systematically transferring the Alpha Funds in ways described as fraudulent. Even Byju and his brother reportedly acknowledged defaults, entering into multiple amendments and forbearances on the credit agreement.
The legal complaint goes on to claim that the trio — Byju, Divya, and Anita — repeatedly contradicted themselves regarding the use and location of the $533 million. On March 15, 2024, following a Delaware Bankruptcy Court order that froze the Alpha Funds, Byju’s claimed in a public statement that the money was “safely parked in one of our subsidiaries.” However, in stark contrast, Byju later declared under oath on October 9, 2024, that the funds had already been spent.
In its plea, Byju’s Alpha seeks multiple forms of relief — including damages for breach of fiduciary duty, civil conspiracy, conversion, and aiding and abetting misconduct — as well as reimbursement of legal expenses and interest.
The unfolding legal battle further deepens the crisis at the once high-flying Indian edtech firm, which now finds itself at the heart of one of the most dramatic corporate showdowns in recent startup history.