Swan Bitcoin Sues Former Employees Over Alleged Theft Of Mining Business

According to BlockBeats, on September 28, Australian mining company Swan Bitcoin filed a lawsuit against a group of former employees and advisors, accusing them of orchestrating a secret plan with Tether's assistance to 'steal' its profitable Bitcoin mining business. Swan Bitcoin claims that six of its former employees stole its trade secrets, including 'proprietary code,' hash rate optimization techniques, and financial models, to create an 'illegal replica company' of Swan's Bitcoin mining business called Proton Management, all with Tether's approval. Reportedly, Tether had funded Swan's Bitcoin mining operations in Tasmania, Australia, in 2023 and was in talks for another round of funding in February this year. According to the lawsuit, Zach Lyons of Marlin Capital Partners, an advisor to Tether, informed Swan that Tether would lead Swan's Series C funding with a $25 million investment, valuing Swan's business at $1 billion. Tether's CFO, Giancarlo Devasini, also expressed high regard for Swan's CEO, Cory Klippsten, repeatedly stating that he considered Klippsten the best CEO in the field. However, Swan alleges that Tether was 'two-faced.' The lawsuit details that Zach Lyons of Marlin Capital Partners began secretly meeting with Swan's former mining director Raphael Zagary (who is not named as a defendant in the lawsuit) and other employees at the end of June, telling them that Swan was 'worthless' to Tether and suggesting that Swan's employees might leave Swan to join Tether or other operators and 'continue doing what they were doing.' With Tether's tacit approval and a legal cover agreement for the coup, Raphael Zagary began 'creating discord and chaos within Swan, disparaging Klippsten, and inciting Swan's advisors and employees to leave Swan' in mid-July. The promised $25 million funding from Tether turned out to be empty promises. The turmoil impacted Swan significantly, leading the company to announce on July 22 that it was abandoning its IPO plans, shutting down its custodial mining division, and laying off about 45% of its staff.