Be careful in choosing your lunch companions. Crypto giant Digital Currency Group says Gemini’s Cameron Winklevoss and his twin brother used a lunch with CEO Barry Silbert as a pretext to contrive a “Twitter-based character assassination campaign” against Silbert and his company that was “personal, vicious and false.”
This is according to a motion to dismiss a lawsuit filed by Gemini in July that claims DCG is to blame for the ongoing mess over Earn, a high-yield crypto-lending program. The Gemini-run program went south after its business partner, DCG subsidiary Genesis, froze the accounts of thousands of Earn customers before filing for bankruptcy in January.
The case turns on when a parent company is liable for the actions of its subsidiary. DCG claims that Gemini seized on offhand remarks at the lunch date to claim Silbert had a direct role in the Earn debacle even though he and DCG had virtually nothing to do with Genesis’s day-to-day operations. The company says the Winklevoss twins raise all sorts of allegations about Genesis, but that they can’t make a case that ties all this to DCG.
The corporate law issue is one for the courts to untangle, but, in the meantime, it’s worth taking a closer look at the Winklevoss antics around the lawsuit. While it’s hardly unusual for parties to use the media to further a legal case, the twins’ kamikaze Twitter tactics do seem a bit much—including, as the new court filing notes, claims that Silbert has been engaged in “lies and deceit” and “stupidity.”
Meanwhile, a person familiar with the litigation told Fortune the Winklevoss twins have seemed to delight in stirring up legal drama on holidays and the weekend. There is no rule that says you can’t do this, of course, but it also doesn’t exactly reflect grown-up corporate behavior. The person also claims the twins have refused to get on board with a settlement deal backed by other creditors that would make Earn’s retail customers whole.
It’s hard to say from a distance who is right in all this, but it does look like the Winklevoss twins have behaved outlandishly at times—even amid reports their company is circling the drain. This is very on-brand for the crypto industry, where most CEOs have turned into Elon Musk wannabes, adopting the juvenile antics of the Tesla CEO but without his charisma or his success. For the good of the industry, the Winklevoss twins should find a new shtick.
Jeff John Roberts
jeff.roberts@fortune.com
@jeffjohnroberts
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