Kyle Roche

Kyle Roche withdraws from lawsuits, steps down from class action practice after bombshell leaks

Roche Freedman partner and co-founder Kyle Roche has requested permission to withdraw from at least four of the firm’s ongoing class action suits following a whistleblower expose which accused the attorney of massive ‘gangster-style’ impropriety.

Roche filed the request in Roche Freedman’s class action lawsuits against Tron, Tether, BitMEX and Bitfinex. Officially, Roche cited his departure from the firm’s class action practice as the reason for his withdrawal.

However, even if that is true, the timing will raise eyebrows given it comes days after a damning expose from digital asset whistleblower Crypto Leaks which included video of Roche confirming that he uses strategic lawsuits to subdue the competitors of Ava Labs, a Roche Freedman client whose CEO Roche describes as a ‘brother’ and in which Roche himself is apparently an equity partner. On video, Roche brags that the insider knowledge gained from his firm’s lawsuits has helped him become one of the ‘top ten’ experts in the industry. He also says that his services to Ava Labs go beyond that of a lawyer and says that part of his job is making sure that regulators—like the U.S. Securities and Exchange Commission (SEC)—have other targets to pursue.

Certainly, Roche Freedman has built something of a name for itself by filing class action suits against the biggest names in the digital asset industry, an endeavour to which Roche has been a major contributor. And to a degree, the firm does seem content to play the numbers game, launching and then withdrawing suits in large batches. For example, in April of 2020 the firm filed 11 class actions suits against digital asset companies, and by the following April seven of them had either been dismissed or withdrawn by the firm. Looking at the targets in those suits—the likes of Tether—they seem to accord with what Roche has to say for his litigation philosophy.

Bulk litigation aside, in the leaked videos Roche is at his most specific when talking about lawsuits filed specifically to sling mud at Ava Labs’ enemies and those of its CEO, Emin Gün Sirer. Roche identifies the multi-billion dollar Kleiman v Wright lawsuit in Florida as a proven example of this practice: he admits to putting Ira Kleiman up to suing Dr. Craig Wright because Wright’s status as Bitcoin’s inventor drove Sirer “crazy.” The leak then shows Roche—still on camera—bragging that BSV was a top five token before Wright became the target of the firm’s “strategic litigation.”

It’s also notable that Roche brags on video about making a point never to settle and taking pride in dragging every case to the bitter end, which lines up with his conduct in Kleiman: according to those familiar with the negotiations, Roche and co-counsel for the plaintiff Velvel Freedman talked Ira Kleiman out of taking a US$3 billion settlement. Ira would go on to win nothing from the suit, which would have left his attorney’s decision to turn down billions of dollars a mystery—were it not for these latest leaks. Notwithstanding that Dr. Wright came out looking like Satoshi Nakamoto anyway, the plaintiff’s legal team—and in particular Sirer, pathological Dr Wright hater that we now know him to be – would not have wanted to miss the opportunity to use the publicity surrounding the Bitcoin Billions case to attack Dr. Wright and generate as much doubt around him as possible. In that light, perhaps Ira Kleiman will join the long queue of formal Roche Freedman associates now suing the firm?

Roche refuted the Crypto Leaks story in a Medium post, but was unable to account for his on-camera statements other than to say they were “false, and were obtained through deceptive means.” Emin Gün Sirer, Roche’s close friend and the CEO of Ava Labs, also issued a denial, stating that neither he nor his firm have any close links to Roche Freedman and that Roche was merely “retained in the early days of our company.”

These hasty and inconsistent denials evidently didn’t do enough to decontaminate Roche Freedman’s many lawsuits, with Kyle Roche’s withdrawal coming mere days later. That’s no surprise: despite these statements from Roche and Sirer, much of what Roche admits to on camera and subsequently alleged by Crypto Leaks is provable based on publicly available information. For instance, though Sirer swore off any close ties to Roche Freedman in denying the story, we know that Roche Freedman received a huge amount of Ava Labs’ AVAX tokens and stock, because the distribution of these assets amongst the firm’s partners has become the subject of a bitter legal fight between co-founders Kyle Roche and Vel Freedman on the one hand and a former partner on the other, one who says he was swindled out of his share of the haul. Crypto Leaks also shows emails from the last 12 months which have Ava Labs staff members introducing Roche as their litigation specialist, directly contradicting the claims in Sirer’s response.

There’s no word yet on whether Roche plans to withdraw from his upcoming appeal of Dr Wright’s victory in that case, which already looked to rest on highly suspicious foundations. The Kleiman claims—which come from Roche himself—are also self-evidently true. After spending years battling through a protracted pre-trial phase and arguing a two-week trial, Kleiman produced no evidence that his brother had any involvement in Bitcoin at all and lost on all but one count—and most importantly, without a dollar’s worth of an award from the court. It was never Kleiman footing the bill, but Roche’s statements confirm that the lawsuit wasn’t his idea in the first place. Rather, it was to prosecute the personal vendetta of Roche’s fraternal friend and client, Sirer of Ava Labs. Sirer is also heavily involved in one of the many insidious efforts to undermine BSV in the marketplace, as it turns out that he is the moderator of Reddit’s r/BSV subreddit, which has been squatted by vehement anti-BSV and anti-Craig Wright critics for years. Quite where this behavior fits in with Sirer’s response—where he encourages everyone to “put aside pettiness, personal attacks and fraudulent lies”—is anyone’s guess.

So, whether Roche leaving the firm’s class action practice is the most immediate cause of these withdrawals is irrelevant. If you take only the most charitable interpretation of Roche’s filmed words, then the firm’s digital asset lawsuits should be looked at with great suspicion. It makes sense for Roche Freedman to distance Kyle Roche from their well-publicized class action suits, but the damage is already done. Who knows what new revelations are waiting to be brought to the surface in any future lawsuits involving Roche or any of the many companies he has offered his ‘extra-legal’ services to over the years? In any case, if what Roche has said about the benefits that this cynical litigation strategy has wrought for him and his firm are to be believed, then there’s no telling how far this rot spreads.

Given more of Roche’s former partners are suing him and the firm all the time, and the inevitable wrath of Ira Kleiman when he realises he has no money coming his way, we may still yet find out.

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