Ethereum Adviser Sues Law Firm For $100 Million Over Mishandled Defense

According to Cointelegraph, Steven Nerayoff, an early adviser to the Ethereum network, has filed a $100 million lawsuit against law firm Covington & Burling. Nerayoff claims the firm mishandled his defense in a 2019 extortion case brought by the United States. The lawsuit, filed on September 6 in the New York County Supreme Court, alleges that Covington lawyer Alan Vinegrad advised Nerayoff not to turn over videos and emails to U.S. prosecutors, which he asserts would have demonstrated his actions were lawful. Nerayoff and Michael Hlady, an associate at his blockchain consulting firm Alchemist, were arrested on September 18, 2019, with prosecutors alleging they extorted a cryptocurrency startup. Nerayoff provided the videos and other evidence to prosecutors in June 2022, leading to the dismissal of charges in May 2023. In his lawsuit, Nerayoff contends that the case could have been avoided if his attorneys had presented the exculpatory evidence in 2019. A spokesperson for Covington denied the allegations, stating that the lawsuit lacks merit and that the firm will defend against it vigorously. The legal complaint also claims that Covington withdrew from representing Nerayoff after his indictment on January 10, 2020, forcing him to spend over $1 million in legal fees over the next three years. Nerayoff's current attorney, Romeo Salta, is seeking an amount to be determined at trial but not less than $100 million, citing the business opportunities and contracts lost in the crypto space due to the indictment. Nerayoff has initiated several other lawsuits this year. In April, he filed a $9.6 billion lawsuit against the government, alleging malicious prosecution and investigation during the extortion case. Additionally, on July 22, he filed a $10 million defamation lawsuit against Tyler Fayard, known as 'Boring Sleuth' on social media, for allegedly defaming him online.