The founders of collapsed crypto hedge fund Three Arrows Capital (3AC), Zhu Su and Kyle Davies, have launched a legal bid to dismiss court summonses issued by the fund’s liquidators, according to a report by Business Times.
At a hearing on Thursday (3 April), both Zhu and Davies applied to have their respective court summonses – mandating their examination in the liquidation proceedings – set aside. Davies also appealed to nullify a contempt of court order tied to the case.
Legal counsel for the founders, Eileen Yeo of Advocatus Law, argued that the disclosure orders were issued to 3AC itself—not to Zhu or Davies personally – and claimed the founders believed they had been cooperating with the court-appointed liquidators. Yeo further contended that proper service of the court orders was not carried out, saying her clients had only been notified informally.
However, lawyers representing 3AC’s liquidators pushed back with Lionel Leo, a partner at WongPartnership, saying attempts had been made to serve Zhu at his listed address, while Davies had apparently vacated his Singapore residence and could not be served. Leo cited previous difficulties in obtaining access to a safety deposit box linked to Davies, arguing it reflected a lack of cooperation.
Chief Justice Sundaresh Menon was critical of the founders’ approach to the legal process, suggesting they had delayed their appeals and were avoiding jurisdictional accountability.
The judgment has been reserved and will be delivered at a later date.
Zhu and Davies, who founded Three Arrows in 2012, saw the once-high-flying crypto hedge fund implode in mid-2022 under the weight of leveraged positions in collapsing digital assets, including TerraUSD. Their conduct during the liquidation process has drawn widespread scrutiny from global regulators and the crypto investment community, particularly regarding the transparency and accessibility of 3AC’s remaining assets.
