Byju Raveendran was held personally accountable for more than $1 billion after the US Bankruptcy Court in Delaware modified its earlier default judgment against him. The court’s ruling, which was prompted by Raveendran’s application to amend the verdict, recognizes that damages were never officially decided. In January 2026, a new stage of the legal process will start to determine if any damages are due.
default decision
The preliminary verdict, which was announced on November 20, was based on a default rule. The court determined that the founder had “obstructed” efforts to track down alleged money diversions, citing his persistent disregard for discovery requirements in a lawsuit brought by lenders. Along with an order for a complete accounting of the contested alpha funds, that verdict awarded $533.0 million on one count and around $540.6 million on other counts.
The special purpose vehicle Byju’s Alpha Inc., supported by GLAS Trust, filed the lawsuit, claiming that the company’s founders, including Raveendran, his wife and co-founder Divya Gokulnath, and an associate, had improperly diverted $533 million in proceeds from a $1.5 billion term loan in 2021. GLAS Trust accused them of making fraudulent transactions, falsifying financial facts, and violating fiduciary responsibility.
However, the founders have constantly denied these allegations as “totally false and inaccurate,” claiming that all loan profits were invested in Think & Learn Pvt Ltd (TLPL), the parent business, to finance expansion and acquisitions rather than being used for personal expenses.
Following the reversal, Raveendran’s legal team has vowed counter-litigation and suggested that they are preparing for a full appeal. They claim that in addition to the plaintiffs’ lack of injury, they deliberately deceived the court. They claim that the lenders concealed or misrepresented information, which led to the company’s demise, the loss of almost 85,000 jobs, the impact on 250 million students, and the destruction of tens of billions in enterprise value.
“As of today, Byju Raveendran has not been found liable to pay a single dollar in damages,” they emphasized in their statement. It also stated that they want to demonstrate that the alleged injury never happened and that the action was based on “misleading” assertions during the impending damages procedures. The team also mentioned a $2.5 billion lawsuit that is scheduled to be filed before the end of the year and reserved the right to pursue fines against the plaintiffs’ attorneys for their actions.
All eyes will be on the new court proceedings starting in January as the legal drama moves into its next phase. It will be interesting to see if the founders’ counterclaims will change the story surrounding the so-called alpha funds or if the lenders behind GLAS Trust can prove their claim of damages.
