By Justin Wise
By the time he arrived in London in January, Kyle Roche was on a roll.
Weeks earlier, his firm had scored a $100 million judgment against a self-proclaimed Bitcoin inventor, another step to break from the pack of attorneys trying to make their mark in cryptocurrency law.
Roche had also landed as a client the blockchain startup Ava Labs, paying him and his partners in digitized tokens worth millions.
Now, barely five years out of law school, the young lawyer had come to woo potential investors for a startup venture he said he was working on with Ava Labs. In one restaurant meeting, with the alcohol flowing, the lawyer touted himself as a “crazy motherf—er” when it came to court battles. He also boasted about a bold litigation strategy on behalf of Ava Labs—using investor class-action suits to weigh down their competitors.
In another private gathering that day, he crowed: “Because I sue half the companies in this space, I know where this market is going.”
What he didn’t know: His comments were being recorded.
Those conversations, including one in which Roche boasted his job included giving US regulators other “magnets” to go after, became the fuse that ignited a spectacularly swift downfall for an apparent fast-rising star in the niche field. Since videos of them were anonymously posted online in August, Roche has lost his role as a lead attorney in potentially law-defining cases, exited the firm he founded and retreated from public view.
How it happened offers a window into what can be the cutthroat nature of a fledgling trillion-dollar industry, one whose volatility has engendered a flood of lawsuits, courtroom skirmishes, and, in this case, an apparent elaborate scheme to take down a lawyer.
It’s still unclear who was behind the secret recordings or behind Crypto Leaks, the website that posted them. Roche and his former firm, in statements online and in court, have denied wrongdoing and claimed the videos were selectively edited to erase important context.
They have asserted the hidden-camera ambush was orchestrated by representatives for a Swiss blockchain firm they had sued just months before the London meetings, though they’ve not offered evidence to substantiate it.
Roche declined to comment to Bloomberg Law. But much of the story has emerged through legal proceedings, court filings, public statements and interviews, including with the prominent Norwegian investor at the center of it all.
Roche’s interest in crypto took off during his first year at the Northwestern Pritzker School of Law in 2013, when he became fascinated by the legal systems surrounding currency. As a student, he collaborated with one professor on a paper touting the long-term advantages of the decentralized digital asset Bitcoin.
After graduating in 2016, he landed at the Armonk, N.Y., office of Boies Schiller Flexner, the vaunted Big Law firm, and began representing clients in crypto-related disputes.
Three years later, he co-founded his own firm, one eventually filled with ex-Boies lawyers specializing in fast-developing areas like crypto. One early client, Ava Labs, even agreed to pay them with its fledgling AVAX digital tokens, which had not yet entered the market. Roche also got an equity stake in the company.
Roche and his co-founder, Devin “Velvel” Freedman, had for months worked on novel legal theories they’d argue under their new banner. Their first suit, filed in October 2019, accused the crypto exchange Bitfinex and its affiliate Tether, the company behind the Tether stablecoin, of a multibillion-dollar price manipulation scheme.
The firm later teamed with New York boutique Selendy Gay Elsberg to file 11 suits against crypto exchanges and token issuers for the alleged sale of unregistered securities.
Meanwhile, their Ava Labs bet paid massive dividends. After being introduced in 2020, the value of AVAX tokens owned collectively by Roche Freedman lawyers once reached $250 million, according to claims one partner later made in federal court.
Roche and Freedman also found the spotlight representing a client suing Craig Wright, who has claimed to be the person who developed Bitcoin. The estate of Wright’s alleged former business partner claimed it was entitled to half a cache of Bitcoin they mined together in the asset’s early years.
A federal jury in Florida cleared Wright in December 2021 of claims including fraud and theft, but ordered him to pay a $100 million judgment for the unlawful seizure of intellectual property.
Roche Freedman touted the judgment as precedent-setting. Roche would later cite the verdict to support his litigation bona fides.
“The litigation with Craig Wright put them on the map,” said Stephen D. Palley, a lawyer who has written on legal topics relating to crypto.
Weeks after that case, however, Roche took the trip that would change his fortunes.
He arrived in London hoping to line up investors for a litigation crowdfunding startup he wanted to develop with Ava Labs. Named Ryval, the venture was intended to allow people to place bets on litigation on Ava’s Avalanche platform.
On a Thursday afternoon, Roche traveled to a three-story townhouse in the city’s upscale Mayfair section that served as the office of Christen Ager-Hanssen, a high-profile venture capitalist who has reportedly made and lost millions in tech and media deals. Ager-Hanssen covered the first-class airfare and hotel costs for Roche and his fiancee, Roche would later say in a declaration submitted in court.
The meeting was arranged by an independent business consultant living in London, Ager-Hanssen said in an interview and a written statement to Bloomberg Law. The Norwegian businessman said he had never before met the consultant, who identified himself as Mauricio Andres Villavicencio de Aguilar. According to emails shared with Bloomberg Law, the consultant had first contacted Ager-Hanssen in November 2021 about coordinating a potential investment opportunity in the blockchain arena.
Ager-Hanssen said he quizzed Roche at his office for a couple hours about Ava Labs and the proposed startup. He said he did not record the meeting, or know who did, but that the video excerpts later released were from the consultant’s vantage at the table. He also said he did not go with Roche to the restaurant that night, but that the consultant did.
Ager-Hanssen said he was intrigued by the Ryval concept, and flew to New York weeks later to continue talking with Roche and Ava Labs executives. By March, however, his interest had waned and he opted not to invest.
The startup plans lagged in the ensuing months. Roche still stayed busy, splitting his time between New York and Miami as his firm grew to more than 20 lawyers and became more active in the class-action sphere when the digital asset market plummeted.
The crash stoked a lot of scrutiny. Amid the fallout, an anonymous website emerged, promising to root out bad actors.
Crypto Leaks announced itself in June with a website, a Twitter account, and pledges to expose corruption in the fledgling industry.
“Follow us to find out what vested interests don’t want you to know,” it said in its inaugural tweet. But Crypto Leaks hid behind its own curtain: Its domain was anonymously registered that May.
Its first two posts focused on what it called “attacks” on the Internet Computer blockchain and the once-buzzy ICP token introduced by the Dfinity Foundation, a Swiss nonprofit led by Dominic Wiliams. The digital asset quickly plummeted in value after being sold to retail investors in May 2021.
Neither of the website’s first posts got traction. Then, on Aug. 26, Crypto Leaks released its third so-called “case study.”
“Ava Labs (Avalanche) attacks Solana and cons SEC in evil conspiracy with bought law firm, Roche Freedman” blared the headline.
The post claimed to reveal “an extraordinary secret pact” between Roche Freedman and Ava Labs “that harms the crypto industry.” It described Roche as a lawyer who used the legal system “gangster style” to attack Ava Labs’ competitors, and pursue “personal vendettas” for the blockchain company’s leader.
Weaved into the text were 25 video clips of Roche speaking in two settings: at the conference table in the Mayfair office that January afternoon and in the bustling restaurant he visited later that night, in front of a plate of food and a wine goblet.
Excerpts from both showed Roche explaining his close ties to Ava Labs and his win-or-go-home approach to litigation, and at times disparaging the legal system. In one clip, he reveled in “the fact that 10 idiots control the flow of all the money that happens in American class actions.”
The recordings’ release sparked a quick disavowal from Ava Labs’ CEO and statements from leaders across the crypto space—both about what Roche said and whoever recorded it.
“Who’s funding all these hit pieces?” tweeted Changpeng Zhao, the CEO of Binance, one of the world’s largest crypto exchanges.
Roche quickly denied deploying litigation as a weapon to go after Ava Labs’ competitors and vowed to fight efforts to intimidate him and his firm. But the blowback was intense. In court filings, his firm said he had received “threats of violence” in the days after the recordings were released.
Within days, Roche’s partners announced he was barred from participating in any ongoing class action. They called the move an attempt to protect the firm against appearances of impropriety.
That didn’t stifle Roche’s detractors. Lawyers for Bitfinex and Tether, defendants in a class-action suit brought by Roche Freedman, called for the entire firm to be disqualified, claiming the videos raised “grave concerns” about their motivations.
At least four defendants in other cases, including Dfinity, also brought disqualification motions against the law firm, citing Roche’s London comments as a conflict of interest.
At least one of Roche’s clients dropped him. One partner left the firm.
Ava Labs also sought to distance itself. CEO Emin Gun Sirer called the allegations of targeting competitors through litigation “conspiracy theory nonsense” and said Roche made false statements about his work for the company. By mid-September, he publicly declared that Roche no longer represented Ava Labs and that he’d relinquished his shares in the company.
The next month, Roche’s partners fought to keep the firm’s role as lead counsel in the class action against Bitfinex and Tether—a case they had been litigating for three years. They argued they were victims of a scheme by another defendant in a separate case to cripple the firm’s cryptocurrency practice.
New York Judge Katherine Polk Failla was unpersuaded, concluding that Roche’s “uniquely stupid” comments were “too detailed to dismiss” as just being “drunk and stupid.” She said she recognizes the difference between Roche and his partners, but said, “at this point in time, I have concerns about the firm as well.”
Roche, meanwhile, tried to identify his saboteur.
He publicly claimed that Ager-Hanssen had been working for Williams, the Dfinity leader. He offered no evidence to back up the claim, but in a post on the website Medium, Roche cited a 2017 article in The Telegraph, a U.K.-based newspaper, that noted Ager-Hanssen helps “eccentric billionaires” facing legal issues and that he has a history of covert recordings.
Last week, Roche’s former partners asserted in a court filing that Ager-Hanssen is a “‘conflict management’ specialist” who was hired by Dfinity to spy on Roche. The filing was made in the firm’s ongoing class action against Dfinity for alleged securities fraud and market manipulation.
“The publicly available evidence establishes” Dfinity is behind the Crypt Leaks site, the firm added, noting that on the same day the Crypto Leaks domain was registered, Dfinity’s CEO had tweeted he was “coming for’’ those who attacked the ICP token.
Neither Dfinity nor its outside counsel responded to repeated requests for comment from Bloomberg Law.
In a phone interview, Ager-Hanssen denied Roche’s accusation, claiming he’s never met Williams and that he did not know about the surreptitious recordings. He said he suspected they were arranged by the consultant. He said he has not spoken to the man since the meetings —and can’t be sure Villavicencio de Aguilar wasn’t an alias.
Still, Ager-Hanssen hasn’t shied from the attention, celebrating Roche’s downfall. “Kyle Roche dragged me into this by lying about facts,” he tweeted on Aug. 30, a day after Roche accused him of being behind the recordings.
Bloomberg Law has been unable to reach the consultant or confirm his name and occupation. Emails sent to an address he used with Ager-Hanssen and others were not returned.
The disclosure of the recordings could be in violation of privacy laws in Britain, including the 2018 Data Protection Act.
Two weeks ago, Roche’s partners severed ties with him and moved to rename the firm Freedman Normand Friedland LLP.
“We are focused on continuing to provide our clients with top quality representation and are proud of the firm’s accomplishments to date,” a spokeswoman said in their only public comment. “We wish Kyle the best in his future endeavors.”
Roche has since established his own practice, Kyle Roche P.A., according to an Oct. 20 court filing. He continues to represent clients in some individual matters.
Like his ex-colleagues, Roche is vying to remain counsel in the case against Wright, which is now on appeal. Wright, too, has moved to disqualify Roche and his former firm.
It’s unclear if Roche or his former firm are taking more steps to bolster their claims that people from Dfinity were behind the recordings. But details are likely to emerge in the coming weeks; a California judge has scheduled a Jan. 12 hearing on Dfinity’s motion to disqualify the law firm from its class action case.
By then, nearly a year will have passed since the fateful trip that changed Roche’s path.
“You can have 15 minutes of fame and you can have 15 minutes of infamy,” said Jan Jacobowitz, a University of Miami law professor and legal ethics adviser. “He may have loyal clients that are going to stay with him. It’s always hard to measure how long public sentiment will last.”
To contact the reporter on this story: Justin Wise at jwise@bloombergindustry.com
To contact the editors responsible for this story: John P. Martin at jmartin1@bloombergindustry.com and Chris Opfer at copfer@bloombergindustry.com
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