Byju’s founder liable for over $1 billion default judgment, plans appeal

In a heavyweight move in US insolvency law, a Delaware bankruptcy court has issued a default judgment against Byju Raveendran, holding him personally liable for more than $1 billion in connection with the financing-arm of Byju’s and its missing funds. The ruling stems from the 2021 term-loan financing of US $1.2 billion raised via the company’s US subsidiary, Byju’s Alpha.

According to court filings, approximately $533 million was transferred from Byju’s Alpha in 2022 to a Miami-based hedge fund named Camshaft Capital, and another $540.6 million was moved in 2023 from a related limited-partnership interest. The judgment found that Raveendran repeatedly failed to comply with discovery orders and court directions, triggering the so-called 'extraordinary remedy' of a default judgment.

Raveendran has announced his intention to appeal the judgment, arguing that the court deprived him of a fair opportunity to defend his case. He maintains that the loans and asset transfers were made on behalf of the parent company, Think & Learn Pvt Ltd, and denies personal wrongdoing or misappropriation of funds.

The dispute comes amid the broader collapse of Byju’s—from a once-valued $22 billion ed-tech unicorn to company under insolvency resolution, board exits and investor withdrawals. What makes this case notable for the tech industry is its intersection of startup financing, global debt markets, offshore fund flows and regulatory oversight—a convergence increasingly evident in large tech-financing disputes.

For creditors and stakeholders, the judgment reinforces the trend of cross-border enforcement efforts and illustrates the risks faced by founders and early-stage firms when large sums are raised via complex financial vehicles. For Raveendran and Byju’s, the appeal will test not only procedural defences—such as jurisdiction and discovery compliance—but also how multi-jurisdictional insolvency cases are handled in the digital-economy era.

The next chapter will unfold in US appellate courts, with potential ramifications for Indian-headquartered startups relying on global debt structures and international lenders seeking recourse. Meanwhile, the case raises questions over corporate governance, board oversight and founder liability in high-growth tech sectors.