Sergei Klubkov claims that he was ousted after he appointed former CEO Hamed Abbasi to the board of directors.
Plooto co-founder Sergei Klubkov has filed a lawsuit against the Toronto-based payments scaling company and its board of directors, including CEO John McClain, for allegedly violating its shareholders' agreement.
The lawsuit alleges that the unanimous (U.S.) shareholder agreement was entered into as part of the 2022 Plooto Agreement. Serie B round should have allowed Kloubkov to reintegrate fellow co-founder Hamed Abbasi into the board after his acquittal in sexual assault case earlier this year. Instead, court documents allege that Abbasi was elected and then promptly removed from the board in August against Kloubkov's wishes. These charges have not yet been proven in court.
Klubkov claims that he was removed from his position as technical director in “obvious revenge” for trying to bring his fellow co-founder back to the company.
Founded in 2015 by Abbasi and Klubkov, Plooto software helps small and medium-sized businesses (SMBs) automate accounts payable and receivable transactions and integrates with accounting systems such as QuickBooks, Xero and NetSuite to eliminate manual data entry and automate invoice and invoice reconciliation. As of October 2024, Plooto served more than 10,000 customers and had 120 employees in Canada and the United States.
Klubkov claims that within weeks of Abbasi's election and removal, he was removed from his position as CTO “without cause” and in “clear retaliation” for trying to bring his fellow co-founder back to the company. company. He claims that Plooto was also planning an acquisition apparently aimed at diluting Kloubkov's stake in the company. The accusations were also not proven in court.
The suit seeks a finding that Plooto and its directors conducted business in a manner that unfairly disregarded Klubkov's interests as a shareholder, and that Abbasi's removal caused harm to the United States. He is seeking an order quashing the shareholder votes that removed Abbasi and reinstating Abbasi as a director. Alternatively, Kloubkov could obtain a court order from Plooto to buy out his stake in the company and cover legal costs.
Klubkov filed the lawsuit in Toronto court on November 10 and publicly announced the proceedings in the Toronto court. LinkedIn post in about a week. BetaKit has reached out to Klubkov, McLane and Plooto for comment.
“While this deeply saddens me and despite my sincere efforts to resolve these issues amicably, the Board of Directors has left me with no choice but to seek relief through legal means,” Klubkov wrote in a LinkedIn post that did not mention that the lawsuit is based on Abbasi’s reinstatement to the board of directors.
Abbasi responded to the post with a comment, writing: “I admire your courage in this difficult battle.”
Klobkov claims the dismissal was “unfair” retaliation
Abbasi stepped down as CEO in March 2024 after he was charged with sexual violence, for which he was acquitted earlier this year. The company reported to BetaKit in October 2024, announcing McLain as CEOthat Abbasi resigned “for personal reasons”.
According to the lawsuit, Klubkov and Abbasi had the right to nominate up to two directors to serve on Plooto's US board of directors. When Abbasi resigned, Klubkov “fully expected” that he would return as director if he was cleared of criminal charges.
Instead, when Kloubkov appointed Abbasi to fill a vacant board seat in May of this year, Plooto allegedly notified shareholders that a meeting would be held to elect Abbasi with plans to immediately remove Abbasi as a director upon his election.
According to the lawsuit, the shareholder notice did not adequately inform voters of Klubkov's and Abbasi's rights in the United States. Allegedly, Klobkov was required to “approve” Abbasi’s removal. When Abbasi asked Chairman Albert Wahbe to adjourn the meeting so shareholders could assess potential US violations, Wahbe allegedly refused.
Klubkov's lawsuit alleges that he was fired from his position as technical director a week later without cause, although he received no indication that he was not thriving in his role. The company had actually increased Klodkov's compensation package just four months earlier to recognize his performance. The document does not mention the size of the increase. Plooto allegedly portrayed Kloubkov's departure as a mutual decision to its employees, but the lawsuit claims “that was not the case.”
CONNECTED: Former Plooto CEO Hamed Abbasi acquitted of sexual assault
“This termination was in bad faith and in retaliation for Mr. Klubkov’s attempts to exercise his rights in the United States,” the lawsuit states.
In addition, Kloubkov claims that Plooto on October 27 began considering the possibility of acquiring United Arab Emirates-based corporate card and expense management software Pluto Technologies Limited in an effort to dilute its stake in the company. Although Plooto had previously decided not to acquire Pluto, McLain allegedly advised Kloubkov that, as part of the renewed acquisition plan, Plooto intended to issue the same class of voting common stock that Kloubkov owned.
The issuance will deprive Klobkov of a majority of the voting power of the outstanding common shares and will deprive him of the right to select a U.S. director. Kloubkow argues that Plooto never used its voting common stock to acquire any other assets and that the acquisition is contrary to Plooto's corporate strategy of conserving cash.
“In short, there is no genuine business purpose for this transaction,” the document said. “The purpose of acquiring Pluto is to marginalize Mr. Klubkov.”
Klubkov appointed Stockwoods LLP as his legal adviser.
Artistic image courtesy of Plooto website LinkedIn.
