Fraud Lawsuit Against Michael Egorov, the CEO of DeFi Giant Curve, Is Quashed in California

A judge ruled a California courtroom is the wrong venue since Egorov wasn’t living in the state when the alleged misdeeds took place.

AccessTimeIconSep 7, 2023 at 6:13 p.m. UTC
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A lawsuit brought by a trio of venture capital firms against the CEO of decentralized finance giant Curve Finance, Michael Egorov, was rejected by a California judge partly because the defendant didn’t live in the state when the alleged misdeeds took place.

ParaFi Capital, Framework Ventures and 1kx had accused Egorov of engaging in a “brazen” scheme to defraud them, according to the lawsuit filed in the Superior Court of California in San Francisco. The complaint alleged that Egorov misappropriated trade secrets of the three VC firms and defrauded the firms out of close to $1 million in funds while dangling the false promise of a possible stake in Curve to gain the investors’ trust and support.

But Judge Richard B. Ulmer Jr., in an order posted Wednesday, said Egorov hasn’t lived in California since 2018, but the behavior the plaintiffs cited took place in 2020, meaning a California courtroom is the wrong venue.

The three VC firms have been pursuing a breach-of-contract case in Switzerland against Egorov and his company Swiss Stake since 2020, and have also alleged that Egorov moved to Switzerland to insulate himself from inevitable legal fallout.

Curve is a decentralized exchange built on the Ethereum blockchain and ranks among the biggest DeFi trading platforms, with some $4.07 billion in total locked value, according to DefiLlama.

Egorov’s lawyers at DLA Piper provided a comment via email: “We’re extremely happy for Michael that the Court understood the parties specifically agreed to resolve all disputes in Switzerland and correctly rejected the attempt to drag him into a California lawsuit. We fully expect Michael to prevail in Swiss courts, which have already expressed skepticism about Plaintiffs’ claims.”

Latham & Watkins, the law firm representing the three VC firms, told CoinDesk via email that they disagree with the court’s decision that their clients’ U.S. claims should be brought in Switzerland.

“More importantly, we note the Court did not dismiss the claims on the merits – it merely made a procedural determination that the claims ought to be brought in Swiss court,” Latham & Watkins said via email. “Our clients’ Swiss lawsuit was only recently initiated and Mr. Egorov has already been ordered to testify in that matter. We remain confident we will hold him accountable and that our clients will be rightfully given what they were promised – a stake in the Curve platform.”

Edited by Nick Baker.


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Ian Allison

Ian Allison is an award-winning senior reporter at CoinDesk. He holds ETH.

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