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Layer1 CEO Alleges Co-Founder is using Majority Power to ‘Ransack’ Company

The plaintiffs argue that when Enigma’s corporate governance disintegrated, Dolic and Ebel began engaging in illicit commercial operations.

Layer1 Technologies’ CEO has launched a lawsuit against the company’s two other board members, including co-founder Jakov Dolic, for allegedly commandeering Layer1’s operations for personal benefit.

On February 2, chief executive John Harney and DGF Investments Inc, a British Virgin Islands-based investment business, filed a case in Delaware’s Chancery Court against Dolic and fellow board member Tobias Ebel.

According to the complaint, Dolic and Ebel took advantage of a power vacuum at Layer1’s equity parent Enigma to gain control of the Bitcoin mining firm and run it as their “own personal fiefdom.”

Harney and DGF Investments Inc, which has a controlling share in Enigma, contend that the defendants “usurped the power” of Layer1’s CEO and prohibited Harney from “responsibly running Layer1.”

One of the charges leveled against Dolic and Ebel is that they engaged in “massive unlawful transactions” that were not disclosed in Layer1’s financial reporting, and that they used Layer1’s operations to mine Bitcoin (BTC) and kept the proceeds for themselves:

“Dolic and his loyalists” have “wielded their majority board control to ransack Layer1, operating it for their own benefit and engaging in self-dealing transactions with impunity.”

The plaintiffs further alleged that Dolic continues to assert that he controls 77% of Layer1’s ownership. The plaintiffs claimed in the petition that Dolic sold all of his Layer1 stock to Enigma for $16 million on January 24, 2022.

Harney and DGF have emphasized that without impending judicial involvement to certify Enigma’s 100% ownership of Layer1, Dolic and Ebel are free to “operate” the company “for their own gain.”

The most recent case filed against Dolic and Ebel charges a breach of fiduciary responsibility in violation of Delaware General Corporation Law Section 226.

The Plaintiffs want to seek injunctive relief from the court, have their expenses reimbursed by the defendants, and have an appointed custodian administer the firm.

According to a 2020 study, Layer1 Technologies was the first Bitcoin mining business in the United States to fully integrate renewable energy into its operations.

Dolic was contacted for comment by Cointelegraph but did not respond immediately.


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