Court Grants Preliminary Injunction Preventing Defendants From Dissipating Assets

Posted: April 20, 2026 / Written by: Joshua Wurtzel, Samuel L. Butt, Channing J. Turner, Thomas A. Kissane / Categories Commercial, Preliminary Injunction

Court Grants Preliminary Injunction Preventing Defendants From Dissipating Assets

On March 24, 2026, in Aladyshev v. Starta Capital Mgt. II LLC, Index No. 659208/2025, Justice Andrew Borrok granted plaintiff’s motion for a preliminary injunction. The action arose out of the alleged management and operation of Starta Capital Hybrid SPC Fund II Ltd. Specifically, the plaintiff-investors in the fund alleged that defendants exercised control over the Fund and its assets while failing to provide required financial disclosures and diverting or otherwise mishandling investor assets. The plaintiff-investors sought a preliminary injunction enjoining the Defendants from taking any corporate actions on behalf of the Fund, the Flagship SP Fund, the Coinvestment SP Fund, or Starta Capital Management II LLC, including dissolution, and freezing the Defendants’ (except Serge Milman) bank, brokerage, and custodial accounts to prevent further dissipation of assets. In granting the motion, the Court explained:

On the record before the Court, the Plaintiffs have demonstrated a likelihood of success on the merits. The verified complaint and supporting submissions set forth specific allegations of breaches of contractual and fiduciary duties, including deviation from the Fund’s stated investment parameters, failure to maintain required corporate formalities, and lack of transparency concerning Fund assets.[]

The Plaintiff-Investors have also established irreparable harm, as the alleged dissipation or transfer of Fund assets (particularly where the Fund’s legal status has been compromised) would risk rendering any judgment ineffectual. The Cayman Islands Registry strike-off highlights this problem.

Finally, the balance of the equities favors maintaining the status quo and preserving the Fund’s assets pending adjudication of the instant claims.

(footnote omitted).

Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions concerning preliminary injunctions.