Former CEO of stablecoin TUSD developer sues the company, saying he was thrown out during acquisition negotiations with Tron

Author: DL News

Translated by: Joy, PA News

The ousted CEO of stablecoin TrueUSD developer Archblock is suing his former colleagues, claiming they forced him out of the business so they could continue to profit for themselves at the expense of investors.

Archblock co-founder Daniel Jaiyong An said in a complaint filed in Delaware court on July 14 that he was fired as CEO in mid-2020.

At the time, he was in talks with billionaire Justin Sun about the sale of TrueUSD, a $2.8 billion stablecoin, to Sun’s blockchain company Tron, the lawsuit seen by DL News said.

“This lawsuit has nothing to do with me,” Justin Sun told DL News. “This is a former Archblock employee suing Archblock.”

He did not answer a question about whether Tron attempted to buy TrueUSD in 2020, as the lawsuit states.

TrueUSD trades did go through that year. A British Virgin Islands consortium called Techteryx acquired TrueUSD from Archblock in 2020, but Archblock continues to manage TrueUSD operations.

The Archblock subsidiary announced on the same day the lawsuit was filed that Techteryx, not named in the lawsuit, would take over “full management of all offshore operations and services related to TUSD.”

**What’s in the lawsuit? **

The Archblock-related lawsuit only mentions Justin Sun in passing.

It details how, in July 2020, An was kicked out of the company he co-founded with Rafael Cosman.

In 2019 and 2019, TrustLabs launched an investment contract called Simple Agreement for Future Tokens (SAFT). The idea is to raise funds for the development of a tokenized platform. The TrustLabs SAFT entitles investors to receive TRU tokens through 2023, provided investors are funding the development of the platform.

The SAFT raised $35 million for TrustLabs, which issued TrueUSD and TRU tokens in 2018.

However, in 2020, Rafael Cosman began moving away from the tokenization platform to other income opportunities, launching a rewards program for TrueUSD holders called TrueRewards, later renamed TrueFi, according to the lawsuit.

There were concerns that TrustLabs’ new business model fell far short of what they had promised investors, the document said.

An wants to disclose the move to investors and offer a chance for a refund, or risk violating securities laws, especially as the new company starts to look more like a blockchain lender.

But the lawsuit said Rafael Cosman and other executives feared they would lose their cash cow if they disclosed the new direction to investors.

In July 2020, Rafael Cosman led the vote, along with TrustLabs Finance Director Alex de Lorraine and board member and advisor Tom Shields, to remove An and appoint Cosman as CEO.

At this time, An was in talks to sell TrueUSD to blockchain firm Tron, the lawsuit said. The lawsuit includes screenshots of what appears to be a conversation between An and Justin Sun negotiating the sale of TrueUSD. Sun appeared to demand that the deal be kept secret, but An refused.

According to a screenshot of the Telegram chat filed in the document, An told Justin Sun during the exchange: “It’s not feasible that we do a transaction and it’s still kept secret from a few people — it’s like handing over the keys and printing rights of $140 million in escrow without telling the relevant stakeholders.”

The lawsuit alleges that when negotiations with Tron were about to be finalized, An was ousted and unable to represent the interests of SAFT investors amid ongoing legal threats from the defendants.

Archblock** denies**** the claims made in the lawsuit. **

“Mr An’s current allegations will prove to be baseless. We intend to respond to Mr An’s allegations in court soon which will bring clarity to the matter,” a spokesman said.

“Given that these matters are in litigation, we do not intend to make further comment outside of that process.”