Ondo Finance is facing a corporate governance battle in Delaware after the estate of late founder Nathan Allman challenged Ian De Bode’s position as chief executive and sought to establish control over the tokenized real-world asset company.
The dispute follows Allman’s unexpected death in May. Ondo had announced at the time that De Bode, the company’s longtime president, would assume the CEO role with the backing of its leadership team.
A verified complaint filed in the Delaware Court of Chancery alleges that De Bode improperly assumed control of Ondo after Allman’s death and attempted to establish himself as the company’s sole director without the required board approval.
The court has not ruled on the allegations.
Ondo’s leadership dispute began after Allman’s death
According to the complaint, Allman died while serving as Ondo’s CEO, sole director and controlling shareholder.
His voting power subsequently became part of his estate and could not immediately be exercised while probate proceedings were underway. Kathleen Allman, Nathan Allman’s mother, was appointed personal representative of the estate by a Hawaii court on June 26, according to the filings.
The public version of the complaint does not disclose the precise size of the estate’s voting stake. It also redacts the cause of Allman’s death.
The estate alleges that De Bode claimed he automatically became CEO after Allman’s death and took steps to exercise corporate authority before a board had approved his appointment.
The complaint argues that Ondo’s bylaws required board action to fill the CEO vacancy.
De Bode has rejected the allegations.
“Kathy Allman’s decision to file a lawsuit is regretful,” De Bode said in comments reported by CoinDesk, adding that the claims were “meritless” and would be addressed in court. He also said Ondo continues to have the support of key stakeholders, lead investors and the Ondo Foundation.
Founder’s estate seeks control of Ondo
After gaining authority to represent the estate’s shares, Kathleen Allman initially sought to work with De Bode on a transition, according to the complaint.
The filings say she subsequently appointed herself to the board, requested corporate information and sought to maintain ordinary business operations while the governance questions were addressed.
The estate alleges that those efforts failed after De Bode and Ondo’s outside counsel refused to recognize her actions or provide requested corporate records.
Kathleen Allman subsequently expanded the board and appointed new directors.
On July 24, she and newly appointed board member Tahnee Towill voted to remove De Bode from his positions at Ondo, according to the filing. Allman was also appointed chair, CEO, secretary and treasurer on an interim basis.
The estate has described the arrangement as transitional, saying its objective is to stabilize the company while a long-term successor to Nathan Allman is found.
Ondo’s RWA business raises the stakes
The dispute comes as Ondo has established itself as one of the prominent companies in the tokenization of real-world assets.
Founded by Nathan Allman in 2021 after his time on Goldman Sachs’ digital-assets team, Ondo has developed products including the USDY yield-bearing stablecoin, OUSG tokenized U.S. Treasury exposure and tokenized equities through Ondo Global Markets.
CoinDesk reported in May that Ondo had reached approximately $3.5 billion in total value locked under Allman’s leadership.
The company’s governance dispute therefore extends beyond a leadership disagreement. The Delaware proceedings could determine who has authority to make corporate decisions involving the company’s board, shares, contracts and other operations.
The estate has asked the court for an expedited ruling, citing uncertainty around corporate control and the potential consequences for company decisions.
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Both sides say Ondo’s operations should continue
Despite the dispute, both sides have indicated that they intend for Ondo’s business to continue.
The board backed by Allman’s estate said it remains committed to Nathan Allman’s vision of bringing financial markets onchain and intends to maintain operations while searching for a successor.
De Bode, meanwhile, said Ondo’s existing leadership remains committed to its clients, ecosystem and Allman’s vision.
The Delaware Court of Chancery will ultimately determine the legal questions surrounding control of the company. Until then, the competing claims from the estate and De Bode remain unresolved.
Keep reading CoinAfrica for more stories like this: Ondo Finance Governance Battle
1 Comment
Leadership is key in an industry. They should talk things out calmly