Byju founder told US ally to flee US to avoid testifying: Report

Byju Raveendran, the founder of Edtech giant Byju, allegedly encouraged a Nebraska businessman to leave the United States to avoid testifying in a federal trial, Bloomberg reported. The claims were made during a hearing Thursday in Delaware.

The businessman, William R. Hailer, testified before U.S. Bankruptcy Judge John T. Dorsey, claiming that Raveendran offered him a lucrative job and sent him a $10,700 plane ticket to Dubai just two days before to be scheduled to testify.

Hailer said Raveendran urged him to leave the US and reiterated a job offer with an annual salary of $500,000, suggesting the role would start immediately if he moved.

“He encouraged me not to testify,” Hailer said in court, according to the Bloomberg report. “He said I should come to Dubai and the salary would start from day one.”

The case revolves around Raveendran’s efforts to regain control of Byju’s international operations, including Epic!, a US education software company. These operations are currently under the supervision of a court-appointed administrator. According to Hailer, the founder tried to buy back $1.2 billion in outstanding debt owed to US creditors in exchange for shares in Epic! However, the plan failed.

Judge Dorsey indicated that Hailer’s allegations warrant a referral to federal prosecutors, who can investigate whether a crime occurred.

Earlier this year, another associate of Byju’s allegedly fled the US to avoid testifying in the same case, leading to a contempt of court order.

Hailer’s testimony also highlighted the challenges Byju’s faces as it battles legal proceedings in both the US and India. The company is under judicial supervision in both jurisdictions, with Indian authorities working to settle creditor claims.

Byju’s creditors allege that Raveendran hid $533 million in loan proceeds that should have been used to repay debts. Creditors have been pursuing legal action in US courts for over a year.

In court documents, Hailer described himself as “used as a pawn in Byju’s manipulation of the law” and said his testimony supports the trustee’s plan to sell Epic! to help pay off the company’s debts.

Neither Byju’s nor Raveendran’s representatives have yet to comment on the allegations. Raveendran has previously denied allegations of wrongdoing, saying his actions were necessary to counter aggressive tactics by lenders specializing in distressed companies.