Bitcoin services firm Swan Bitcoin has filed an ex parte application in the Southern District of New York seeking subpoenas for Cantor Fitzgerald and its former CEO, Howard Lutnick, for documents tied to a failed mining venture and a coordinated employee departure.
Swan sued several former employees in September 2024, alleging they stole confidential materials, resigned, and immediately founded a competing firm, Proton Management, while persuading Tether — then one of Swan’s funding partners — to sever ties with Swan and work with the new entity. Swan says the ex-staff dubbed the plan “rain and hellfire.”
The subpoena application, filed Monday, targets Cantor Fitzgerald and Lutnick on the grounds that they may possess key documents related to Swan’s mining partnership with Tether, the 2040 Energy project, and to the alleged employee exodus and data exfiltration. The request for documents directed at Lutnick comes amid scrutiny from Democratic senators, including Elizabeth Warren, over potential conflicts of interest involving Tether.
Swan notes Cantor Fitzgerald has acted as Tether’s investment banker and advised the stablecoin issuer on moves into Bitcoin mining. Because of that relationship, Swan alleges Cantor likely had knowledge of an undervalued sale of Swan’s crypto mining assets to a Tether subsidiary.
Swan says CEO Cory Klippsten met with Lutnick in June 2024 while exploring an initial public offering and considering Cantor as lead investment banker. During those talks, Swan says it shared a “highly confidential and proprietary slide deck” and gave Cantor a tour of its mining facilities. According to Klippsten, after mass resignations and the diversion of assets, Cantor broke off contact without explanation.
Swan alleges the “rain and hellfire” scheme was organized by Michael Holmes, Swan’s former head of business development, and Raphael Zagury, the company’s former chief investment officer, who became Proton’s CEO. The lawsuit against Proton Management remains active. Defendants have previously denied Swan’s allegations, contending that 2040 Energy was funded entirely by Tether and therefore not their asset.
Cointelegraph reached out to Cantor Fitzgerald for comment but did not receive an immediate response.
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