The legal crisis around Byju’s escalated sharply after a US bankruptcy court in Delaware ordered founder Byju Raveendran to personally pay over $1 billion, citing a pattern of ignoring court-mandated disclosures related to the company’s US operations. The case, brought by GLAS Trust on behalf of Byju’s Term Loan B lenders, centers on a disputed money trail involving $533 million withdrawn from Byju’s Alpha and more than $540 million invested through Camshaft LP. After months of missed deadlines and ignored sanctions, the court said Raveendran’s non-cooperation left no option but a default judgment.
The ruling follows a prolonged battle between Byju’s lenders and Raveendran over access to financial documents and clarity on how the Alpha funds were moved after the company raised its $1-billion Term Loan B. The lenders, who won control of Byju’s Alpha through earlier court proceedings, have argued that the transfers were carried out without proper authorization and were routed through multiple entities in a way that made it impossible to trace the ultimate beneficiaries. The Delaware court previously issued civil-contempt findings and imposed a $10,000-per-day penalty to compel compliance, but noted in its latest order that those sanctions went unpaid and had no effect on Raveendran’s participation in the case.
The court also stated that repeated requests for bank records, transfer details, and accounting documents were met with intentional delays and incomplete disclosures, preventing clarity on whether the funds were misused or legitimately deployed. Therefore, the judgment also directs Raveendran to provide a complete accounting of all Alpha fund movements. Meanwhile, Raveendran’s lawyers have dismissed the ruling as unjust, arguing the case was rushed into a default judgment without giving him a fair chance to defend himself and insisting the disputed funds supported Think & Learn’s international operations, not personal use. They plan to appeal immediately and are preparing separate claims seeking damages from GLAS Trust and related parties for what they describe as lender-driven harm to the company.
The judgment adds to a rapidly widening crisis surrounding Byju’s, which is already managing multiple insolvency petitions, creditor actions, and regulatory inquiries across India and the United States. Once celebrated as the world’s most valuable edtech startup, the company has faced liquidity shortages, workforce reductions, governance disputes, and a near-halt in venture fundraising over the past two years.
The Tech Portal is published by Blue Box Media Private Limited. Our investors have no influence over our reporting. Read our full Ownership and Funding Disclosure →
