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3AC founder has 'chosen to ignore his duties' by not responding to subpoena, say bankruptcy lawyers

The Cointelegraph ​

Cryptocoins News / The Cointelegraph ​ 123 Views

According to the filing, Kyle Davies was “without question” aware of the subpoena posted to Twitter, citing the 3AC founder's online activity and attempts to raise funds for GTX.

Three Arrows Capital founder Kyle Davies has not responded to a subpoena issued over Twitter aiming to gather information related to the firm’s assets.

In a Feb. 7 filing with United States Bankruptcy Court in the Southern District of New York, lawyers with the Latham & Watkins firm representing 3AC liquidators said Davies had “chosen to ignore his duties to Three Arrows” by failing to comply with the online subpoena.

Courts in Singapore and the U.S. previously authorized the use of Twitter to issue subpoenas, due to the whereabouts of 3AC founders Davies and Su Zhu being unconfirmed while their social media presence remained active.

The subpoena, which was tweeted to a newly created account on Jan. 5, ordered Davies to provide the 3AC liquidators with documents related to accessing account information, including seed phrases and private keys. In addition, the court told the 3AC founder to include details on accounts at centralized or decentralized exchanges and other assets.

“Under the terms of the Subpoena Order and the Subpoena, Mr. Davies was required to respond by electronic production to counsel for the Foreign Representatives by January 26, 2023,” said the filing. “He did not.”

According to the filing, Davies may have based in Indonesia, but was making himself available for interviews and was “without question” aware of the subpoena posted to Twitter:

“Mr. Davies has been active on social media, having ‘tweeted’ or ‘retweeted’ dozens of times on Twitter. Shamelessly, while ducking his obligations to his failed company, Mr. Davies has been recently active in an effort to raise tens of millions to start a new crypto exchange called ‘GTX.’”

Related: 3AC, Coinflex founders collaborating to raise $25M for new claims trading exchange

Bankruptcy Judge Martin Glenn granted a motion aimed at compelling Davies to respond to the online subpoena. According to the judge, the 3AC founder will have until March 16 to respond by providing documents related to the bankruptcy case. In addition, the filing included an order from a British Virgin Islands court compelling Davies to provide documents and appear in a March 14 virtual hearing.

3AC declared bankruptcy in July, shortly before Davies and Zhu largely disappeared from the public spotlight. The Singapore-based crypto hedge fund had at one point managed more than $10 billion worth of assets.


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