Ethereum adviser sues law firm for $100M over case defense

Steven Nerayoff, an early Ethereum (CRYPTO:ETH) adviser, has filed a $100 million lawsuit against the law firm Covington & Burling, claiming the firm mishandled his defense in a 2019 crypto extortion case.

The lawsuit, filed in New York County Supreme Court on September 6, alleges that Covington’s attorney, Alan Vinegrad, advised him not to submit crucial evidence to U.S. prosecutors, including videos and emails of negotiations with the alleged victims.

Nerayoff contends that this evidence would have demonstrated his actions were "entirely lawful" and could have prevented the case altogether.

Nerayoff and Michael Hlady, his associate at the blockchain consulting firm Alchemist, were arrested on September 18, 2019, and charged with extortion of a cryptocurrency startup.

The charges were dropped in May 2023, almost a year after Nerayoff independently provided the withheld evidence to prosecutors in June 2022.

In the lawsuit, Nerayoff states that the case could have been avoided had his attorneys at Covington presented the exculpatory evidence back in the fall of 2019.

A spokesperson for Covington & Burling denied the allegations, describing the lawsuit as "meritless" and asserting the firm will "vigorously" defend itself.

Nerayoff’s legal complaint also claims that Covington withdrew from his representation after his indictment in January 2020, forcing him to spend three years and over $1 million in legal fees.

His current attorney, Romeo Salta, is seeking damages of at least $100 million, citing lost business opportunities in the crypto space due to the indictment.

Nerayoff has been active in the legal arena this year, filing other lawsuits including a $9.6 billion lawsuit against the U.S. government for alleged malicious prosecution in April, and a $10 million defamation lawsuit against social media personality "Boring Sleuth" in July.

At press time, the Ethereum (ETH) price was $2,306.14.