A US court has issued a default judgment, holding Byju Raveendran personally liable for repaying over USD 1 billion. This decision by the Delaware Bankruptcy Court stems from a petition filed by BYJU's Alpha and US-based lender GLAS Trust Company LLC. The judgment, issued on November 20, found Raveendran in default due to his consistent failure to comply with discovery orders and his evasiveness.

The court’s order specifies that a default judgment will be entered against Raveendran for two amounts: $533,000,000 and $540,647,109.29, totaling over $1 billion. Furthermore, Raveendran is required to provide a complete and precise account of the Alpha Funds, including the Camshaft LP Interest, and all subsequent transfers and proceeds.

The case revolves around BYJU's Alpha, which was established while Raveendran was managing Think and Learn Private Limited (TLPL), operating under the Byju's brand. TLPL had secured a $1 billion Term Loan B from US-based lenders. Subsequently, lenders alleged that BYJU's Alpha violated loan terms, asserting that $533 million of the debt was unlawfully transferred out of the US. GLAS Trust then approached the Delaware court, gaining control of BYJU's Alpha, and both entities filed petitions for discovery regarding the $533 million transactions.

The November 20 judgment explicitly states that Raveendran was fully aware of the discovery order but repeatedly refused to comply. The court had previously issued a contempt order and imposed sanctions of USD 10,000 per day, which Raveendran also failed to pay. The court noted that Raveendran's failure to respond to discovery requests was a personal decision and part of a "strategic pattern of willful failure to comply with discovery." His argument that GLAS Trust had access to relevant documents through BYJU'S Alpha's books was rejected due to a lack of supporting evidence. The court concluded that monetary sanctions were ineffective given Raveendran lives abroad and showed no intention of satisfying penalties or complying with orders, thus justifying the harsher sanction of default judgment.

In response, J Michael McNutt, Senior Litigation Advisor at Lazareff Le Bars Eurl, representing Byju's at the US court, stated that Byju Raveendran plans to appeal the order. He claims the US Court erred by ignoring relevant facts and denying Raveendran the right to present a defense by expediting the trial. McNutt emphasized that the judgment is a default judgment, meaning it was issued without Byju being permitted to present a defense. He also asserted that GLAS Trust was aware the Alpha loan monies were not used for personal gain by Raveendran or any founder but for the benefit of Think & Learn Private Limited (TLPL).

McNutt further stated that Raveendran has always respected court processes, accusing GLAS and others of not properly informing the Court and attempting to expedite procedures to obscure that Raveendran has not willfully violated any law or contract. He called for GLAS Trust and the Resolution Professional of TLPL to be held responsible for explaining the use of these funds. Applications are pending in Indian courts to compel such disclosure and accountability. Claims are being prepared against GLAS Trust and others in various jurisdictions, with Byju’s Founders expecting to demand monetary damages of not less than $2.5 billion, to be filed by the end of 2025 if no settlement is reached.