The CEO of crypto miner Layer1 Technologies has filed a lawsuit against two other board members of the company – including co-founder Jakov Dolic – for allegedly commandeering Layer1’s operations for his own gain.
Chief executive John Harney and DGF Investments Inc – a British Virgin Islands-based investment company – filed a lawsuit against Dolic and fellow board member Tobias Ebel in the Delaware Court of Chancery on February 2.
The lawsuit alleges that Dolic and Ebel used the power vacuum at Enigma’s equity parent Layer1 to seize control of the Bitcoin mining company and operate it as their “own personal fiefdom.”
Harney and DGF Investments Inc – which owns a majority stake in Enigma – claim the defendants have “usurped the authority” of Layer1’s CEO and prevented Harney from “operating Layer1 responsibly.”
One of the accusations against Dolic and Ebel alleges that they carried out “large illegal transactions” that were not recorded in Layer1’s financial statements and used Layer1’s operations to mine Bitcoin (BTC) and keep the revenue for themselves:
“Dolic and his loyalists” have “used the control of the majority board to rob Layer1, operate it for their own benefit and engage in independent transactions with impunity.”
The plaintiffs also claimed that Dolic continued to issue a false narrative that he owned 77% of Layer1’s equity. In the filing, the plaintiffs argued that Dolic sold all of Layer1’s shares to Enigma for $16 million on January 24, 2022.
Harney and DGF have emphasized that without court intervention to confirm that Enigma has 100% ownership of Layer1, nothing can prevent Dolic and Ebel from “operating” the company “for their own benefit.”
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The most recent lawsuit filed against Dolic and Ebel alleges breach of fiduciary duty, under section 226 of the Delaware General Corporation Law.
The plaintiff hopes to seek relief from the court through an injunction, payment of costs by the defendants and an order to appoint a custodian to run the company.
Layer1 Technologies is the first Bitcoin mining company in the United States to fully integrate renewable energy into its operations, according to a 2020 report.
Cointelegraph reached out to Dolic for comment but did not receive an immediate response.