Unraveling the $400 Million Lawsuit against Stake.com Co-founders
U.S. Legal Battle: Stake.com Founders Targeted by $400 Million Lawsuit
In a shocking turn of events, cryptocurrency gambling website Stake.com is embroiled in a massive legal battle. The Sydney Morning Herald reports that the platform's Australian founders, Ed Craven and Bijan Tehrani, are facing a jaw-dropping $400-million lawsuit in the United States.
The lawsuit, initiated by a former associate, Christopher Freeman, claims that Craven and Tehrani unceremoniously ousted him from a joint venture without his consent.
Freeman's Perspective
According to Freeman's allegations, he was an early investor in a precursor company to Stake.com, but was not told of the formation of the main platform. Freeman, based in Florida, asserted the crypto-only casino concept originated with him, but Craven and Tehrani allegedly "bullied him out" of the venture.
The lawsuit also accuses the duo of knowingly permitting VPN use to circumvent geo-restrictions, enabling access in prohibited jurisdictions like U.S. states. This allegation sheds light on broader controversies surrounding Stake’s marketing strategies, including its use of streaming platforms like Twitch, which restricted gambling content in 2022.
The Company's Response
In its response, Stake.com categorically dismissed Freeman's claims, branding them as "internally inconsistent, intentionally misleading, and provably false." The company described the lawsuit as a "desperate attempt to spread false information."
The case names both co-founders and the platform itself. Stake.com's legal team has vowed to defend the lawsuit in court, if it's not struck down beforehand. Meanwhile, Freeman has used publicly available information to demonstrate the success of Stake.com, citing the recent purchase of an $80 million home for one of the co-founders as evidence.
The Early Days of Partnership
Freeman claimed that he was a childhood friend of Tehrani and together with Craven in 2013, they decided to set up Primedice, a casino business. The initial ownership in the business was split based on their contributions, with Freeman holding 20%, while the other two participants had a 40% claim.
But nine months after the company was established, Freeman's stake was reduced to 14%, even though he claims that an initial understanding between the trio existed that only people who invested in the company would be entitled to equity.
When Stake.com was formed, Freeman alleged that Tehrani and Craven had told him that the only way to participate in the business would be to move back to Australia and that the new project will only use the US dollar and Euro as its main currencies.
Freeman objected to this proposition, arguing that the FiAT casino business (which was the original idea behind the new project that later became Stake.com) was too saturated and that it also invited certain risks he was not prepared to take. Freeman proposed to move into cryptocurrencies instead, but the pair allegedly said that there were many regulatory challenges to factor in as well.
Regardless, Freeman alleged in his lawsuit that Tehrani and Craven went ahead and launched Stake.com, with features he claims were his own invention. He was also cut off from Primedice, losing access to his accounts, the complaint alleges. Freeman has yet to respond to The Sydney Morning Herald's request for comment.
[1] Source: TNW, Forbes
- The lawsuit against Stake.com co-founders, Ed Craven and Bijan Tehrani, alleges that they unceremoniously ousted Freeman from a joint venture, effectively reducing his stake in the company.
- Freeman's lawsuit against Stake.com accuses the duo of knowingly permitting VPN use to bypass geo-restrictions, thereby enabling access in prohibited jurisdictions like U.S. states.
- In its response to the lawsuit, Stake.com described Freeman's claims as "internally inconsistent, intentionally misleading, and provably false."
- Freeman, based in Florida, claims that he was an early investor in a precursor company to Stake.com, but was not told of the formation of the main platform and was subsequently cut off from his accounts.
- The lawsuit also sheds light on broader controversies surrounding Stake’s marketing strategies, including its use of streaming platforms like Twitch, which restricted gambling content in 2022.
