One of the founding partners of LegalMatch is saying she was wrongly ousted from the board and fired from the company after she reported to authorities about an alleged attempt by others within the company to improperly transfer $3 million from the company to a personal account.
Anna Ostrovsky filed suit on April 11 in San Fransisco County Superior Court against LegalMatch.com, and individuals Dmitry Shubov, Vladimir Shubov, Katerine Ka Yem Abejaron, and others. Ostrovsky is alleging numerous labor code violations, including wrongful termination and retaliation, intentional and negligent infliction of emotional distress and Unfair Business Practices in association with an alleged financial cover-up she reported to authorities.
Founded in 1999 by Anna Ostrovsky and Dmitry Shubov, LegalMatch is a free online service that pairs individuals seeking legal advice and representation with lawyers who specialize in their area of need. LegalMatch also provides free informational content to individuals through an online law library and blog.
In 2004, Shubov stepped down from his role as LegalMatch's CEO, a position he held since the company's founding in 1999, after he was disbarred in New York following a guilty plea in 2004 to unlawfully accessing and deleting voice mails from a rival company. Although he was no longer in the role of CEO, Shubov nevetheless continued to maintain some relative control of the company, Ostrovsky claimed in her lawsuit.
According to Ostrovsky's lawsuit, in 2017, Shubov attempted to launch another online referral company, Adzoco, to operate out of the Philippines.The company was to sell ad space on real estate and personal property. According to the complaint, the idea did not pan out, so Shubov allegedly sought to have LM absorb Adzoco's losses. According to the complaint, he allegedly directed the transfer of $3 million from LegalMatch's U.S. accounts to a newly formed company, allegedly wholly owned and controlled by Shubov LM Philippines (LMPH). According to the complaint, LMPH did provide some services to LM, but they were allegedly considered of little actual value to the company.
According to the complaint, in 2021, LegalMatch's controller began making daily transfers for months until the $3 million was fully transferred, allegedly into newly former cryptocurrency exchange accounts. Thereafter, those balances were allegedly transferred to LMPH crypto wallets.
According to the complaint, after learning there could be tax liabilities stemming from the transfer, Shubov allegedly stated he would evade the liability by having LegalMatch "disappear" the transactions, to allegedly give the appearance they never left LegalMatch holdings.
According to the complaint, Ostrovsky allegedly attempted to uncover Shubov's alleged means to accomplish this without allegedly falsifying financials. But she was allegedly met threats of termination.
According to the complaint, after she reported her suspicions of illegal activity to executive leadership, Ostrovsky allegedly called on LegalMatch's board to remove Shubov from his position on the board and any control he maintained. Ostrovsky claims she was fired without justification, instead, after what she claims to be 23 years of untarnished service.
Ostrovsky is demanding a trial by jury and is seeking actual and punitive damages, court costs and legal fees.
She is represented by attorneys Michael O. Issaazat and Lauren Cholakian of The Azat Law Group, of Pasadena.