Swan Bitcoin has filed a lawsuit against several former employees and consultants, accusing them of orchestrating a scheme to steal its Bitcoin mining operations with the help of Tether, Swan’s former funding partner.
The complaint alleges that six individuals misused Swann’s trade secrets, including its proprietary code and financial model, before launching a rival mining venture called Proton Management.
The lawsuit, filed after the alleged coup culminated in mass resignations of key employees on Aug. 8, does not name Tether as a defendant, but it does not name Tether as a defendant. He is accusing them of supporting him. Tether previously funded Swann’s Bitcoin mining operations in Tasmania and was in talks to lead Swann’s $25 million Series C funding round, which valued Swann at $10. It will reach billion dollars.
The complaint alleges that Tether’s general counsel, Zach Lyons, encouraged former Swann employees to resign and implied that Tether no longer saw value in Swann’s business. The lawsuit details meetings in which Lyons allegedly undermined Swan’s leadership and provided legal protection to employees to form Proton Management, a company that copied Swan’s mining operations. It is stated.
This alleged conspiracy caused chaos at Swan Bitcoin. By July 22, the company had withdrawn its initial public offering (IPO) plans, closed its managed mining division, and laid off 45% of its workforce. Swan’s valuation plummeted after a promised $25 million in funding from Tether failed to materialize.
On August 9, Tether’s legal team sent a “notice of default” to Swann, alleging that Swann had breached its funding agreement by failing to maintain necessary staffing. This was followed by the involvement of Proton Management, a new organization set up by former Swan employees, claiming to provide the services of the same team that had left Swan.
Tether, for its part, has denied any wrongdoing and said it is aware of the allegations but is not named as a defendant in the lawsuit.
Legal experts noted that while the complaint implicates Tether, there are no direct legal claims against the company. Swan is seeking a permanent injunction, compensatory damages, and punitive damages against Proton Management and other named defendants.
