Steven Nerayoff, an early advisor of the Ethereum network, alleges that the law firm Covington & Burling mismanaged his defense of a 2019 extortion case by the United States in a lawsuit for $100 million.
Nerayoff claimed in a lawsuit filed on September 6 in the New York County Supreme Court that Covington lawyer Alan Vinegrad advised him not to provide U.S. prosecutors with videos of “negotiations with the alleged victims” and emails and other messages. He claimed that these materials demonstrated that his dealings were “entirely lawful.”
Nerayoff and Michael Hlady, an associate of his blockchain consulting firm Alchemist, were apprehended and accused on September 18, 2019, with prosecutors alleging that they extorted a cryptocurrency startup.
Nerayoff stated that he provided prosecutors with the videos and other evidence in June 2022. The allegations were dismissed in May 2023, less than one year later.
Nerayoff contended in the lawsuit that the entire case could have been “halted” if his Covington attorneys had “presented the exculpatory evidence to the prosecutors in the fall of 2019.”
A spokesperson for Covington denied the allegations and informed that the “lawsuit is without merit, and we will vigorously defend against it.”
Nerayoff’s legal complaint purports that Covington withdrew from representing him following his indictment on January 10, 2020, and that he incurred over $1 million in legal fees over the subsequent three years.
Nerayoff’s current attorney, Romeo Salta, is seeking a sum of “to be determined at trial but not less than” $100 million due to the indictment’s impact on his ability to “engage in business” and the loss of other contracts in the crypto sector.
Nerayoff has initiated numerous additional lawsuits this year. He filed a $9.6 billion lawsuit against the government in April, alleging that the investigation and prosecution of him during the extortion case were malevolent.
Additionally, on July 22, he initiated a $10 million defamation lawsuit against Tyler Fayard, identified as “Boring Sleuth” on social media, for purportedly defaming him online.
