On Thursday, US Bankruptcy Judge John Dorsey issued a directive for edtech tech firm Think and Learn Pvt to freeze $533 million, safeguarding it for lenders who claim exclusive rights to the funds.
The lenders had sought court intervention to prevent the company which owns Byju’s from utilising the fund.
This decision is a partial win for the lenders, as they clamored for the funds to be placed under federal court supervision to prevent any potential misuse by Think and Learn. The court’s order particularly targets Riju Ravindran, a director at the company and sibling of founder Byju Raveendran.
As the major issue in the legal battle, Ravindran has been tasked with figuring out where the disputed money is located. During the hearing the Judge said, “I do not believe him (Ravindran) when he says he cannot" locate the monies stored by Think and Learn.”
The report is published by Business Standard added that the Think and Learn declined to comment on the matter.
Ravindran's legal representative, Sheron Korpus, argued that the lenders bear responsibility for any financial distress faced by the company. He asserted that the company was justified in withholding the funds from the lenders due to their aggressive stance on the debt default issue. The edtech is currently engaged in legal battles with the lenders in state courts in Delaware and New York.
Previously, the lenders had taken control of a holding company established by Think and Learn to issue $1.2 billion in debt. This entity, Byju’s Alpha, is now undergoing bankruptcy proceedings under Judge Dorsey's supervision. Ravindran is challenging a ruling by Delaware’s Chancery Court that sanctioned the lenders' seizure.
