Oussama Ammar, cofounder of French startup accelerator The Family, has been found liable for fraud and breach of fiduciary duty against the organisation by a UK court, and ordered to pay £6.48m (€7.56m) in damages, according to a legal ruling seen by Sifted.
The Family has suffered one of French tech’s ugliest startup fights in recent years, with multiple legal proceedings filed in France, the UK and the Cayman Islands. The Family accuses Ammar, who left the company in 2022, of having embezzled millions from the organisation and its investors. Ammar denies the accusations.
Last year, the UK court struck Ammar’s defence from proceedings after he failed to comply with several court orders, including requests to serve evidence and pay outstanding costs. This opened the way for a judgement in favour of The Family. The latest hearing, which was intended to determine the amount of damages to be paid, was not attended by Ammar.
Ammar tells Sifted the decision was obtained “by default” and was “non-adversarial”.
Nicolas Colin, Ammar’s cofounder and the main representative for the claimants, tells Sifted: “This was not a case where [Ammar] was denied the chance to engage with the process… Rather, it is a case where, from a certain point onward, he repeatedly and voluntarily chose not to do so.”
Colin says that Ammar had not appealed the decision by the deadline, meaning the judgement is final.
“I’ll be waiting for The Family in the exequatur procedure in France to enforce this decision,” says Ammar, referring to the process through which countries authorise judgments made abroad, which is necessary to seize assets abroad. Ammar says his assets are in France.
The ruling follows another decision against Ammar in the Cayman Islands in 2023, in which the court ordered that he pay €7.3m in damages to The Family.
What is Oussama Ammar accused of?
The Family was launched in 2013 by Ammar and Colin, along with cofounder Alice Zagury, and quickly became one of France’s most famous startup incubators.
Over time the organisation expanded to create and manage special investment vehicles (SPVs) that pooled investors’ money from around the world to back specific startups, including notable unicorns like PayFit and Algolia.
The Family opened a case against Ammar in the UK in 2022, shortly after he left the company. As part of the UK case, the organisation accused Ammar of having misappropriated up to €1.1m of investors’ funds, as well as having made unauthorised payments of up to €1.9m.
Ammar repeatedly denied the accusations, arguing the transactions reflected a way of operating at The Family where the line between personal and professional funds was “unclear”.
The Family also accused Ammar of wrongfully using investors’ funds to purchase shares in companies at an inflated price in order to divert funds to his personal company Fabuleo. This was done via complex schemes in which Ammar purchased shares owned by Fabuelo instead of investing directly in the companies. The Family claims that this caused a loss of nearly €2m across four investment vehicles.
The court’s order for Ammar to pay £6.48m (€7.56m) in damages accounts for the loss of funds, but also the estimated loss of profit caused by the failure to invest the money.
The Family vs Oussama Ammar
In 2022 The Family also launched a legal procedure in the Cayman Islands accusing Ammar of having embezzled nearly €3.5m that was intended to back six high-profile companies including Stripe, Airbnb and SpaceX.
Ammar did not participate in the legal proceedings and a default judgement was made against him in 2022. In 2023, the court issued a final decision against Ammar and ordered him to pay €7.3m in damages to The Family.
Ammar tells Sifted that enforcement of the decision in the Cayman Islands has not taken place yet. “Good luck with that,” he says.
Colin tells Sifted that exequatur procedures are underway in France to enforce the Cayman Islands judgement, and that enforcement efforts have already begun in Delaware, where Ammar also holds assets.
Several legal proceedings are also underway in France, including a criminal procedure for which Ammar was reportedly taken into custody earlier this year.
Read the orginal article: https://sifted.eu/articles/the-family-oussama-ammar-uk-court/
