rewrite this title Former Theta Executives Accuse Crypto Firm’s CEO of Fraud, Retaliation – Decrypt

Two former senior executives at blockchain firm Theta Labs have filed whistleblower lawsuits in California, alleging the company and its chief executive, Mitch Liu, engaged in a years-long pattern of deception, market manipulation, and retaliation.

The complaints, filed separately in Los Angeles Superior Court by former executives Jerry Kowal and Andrea Berry, allege that Liu used Theta Labs and its parent, Sliver VR Technologies, to inflate token prices through misleading partnerships and undisclosed insider token sales, while retaliating against employees who raised concerns.

Liu and representatives for Theta Labs did not immediately respond to Decrypt’s request for comment. 



Theta Labs is a Delaware-incorporated blockchain company developing the Theta Network, a decentralized platform focused on media delivery, computing, and storage, including a newer hybrid cloud layer called Theta EdgeCloud, according to the company’s whitepapers and documentation.

The network uses two primary tokens: THETA for governance and staking, and TFUEL for transaction fees and network services.

Plaintiffs in the cases characterize a years-long pattern of self-dealing tied to Theta Lab’s crypto tokens and NFT marketplace.

“Pump and dump”

“Mitch Liu used Theta Labs as his personal trading vehicle, perpetrating fraud, self-dealing, and market manipulation,” Mark Mermelstein, one of the attorneys representing Kowal through  Holmes, Athey, Cowan & Mermelstein, told Decrypt.

Liu’s “calculated ‘pump-and-dump’ schemes repeatedly wiped out investor and employee value,” Mermelstein alleged. “This suit is about demanding accountability and proving no one is above the law.”

Those actions were “perpetrated by a corporate tech titan and his companies against his own employees and the public at large,” Kowal’s complaint reads.

Liu’s alleged schemes also included “generating false bids for non-fungible tokens,” with some linked to high-profile partnerships with celebrities such as Katy Perry, per the complaint.

Over the course of her employment at Theta, Berry, the other complainant, “learned of, witnessed, and reported numerous instances of fraudulent conduct and self-dealing by Theta employees and executives,” a copy of her complaint reads. Those instances included “schemes aimed at inflating the price of the THETA Token and personally enriching Mr. Liu,” it adds.

Liu’s “primary goal was pumping up the value of the THETA Token,” Berry’s complaint alleges, including through “fake or otherwise highly misleading ‘partnerships’ with high-profile companies.”

Google partnership

Berry’s complaint also targets Theta’s prior claims about Google, alleging the crypto company publicly misrepresented a routine cloud services arrangement as a strategic partnership.

Theta announced a “partnership” with Google in May 2020. Berry’s complaint alleges the relationship was limited to a cloud-services agreement in which Theta agreed to spend roughly $7 million on Google Cloud products, characterizing Theta as a customer rather than a strategic partner. 

The complaint claims the characterization was used to suggest external validation and technological endorsement that did not exist, misleading investors and the broader community about the nature of the relationship.

Two other instances of self-dealing were noted, where “Theta’s purported ‘partners’ are in fact other companies created by and wholly owned” by Liu, the complaint alleges.