Evercrest Technologies, the company behind restaking protocol KelpDAO, filed a civil claim in the Supreme Court of British Columbia on Wednesday seeking aggravated and punitive damages from LayerZero Labs Ltd., LayerZero Labs Canada Inc. and co-founder Bryan Pellegrino over the April exploit that drained $292 million from the protocol's bridge contracts.

The notice of civil claim, filed September 25, 2026, alleges negligent misrepresentation, negligence and defamation. It centers on the bridge configuration KelpDAO operated: a 1-of-1 setup in which LayerZero's own verifier network was the sole party confirming that tokens had been locked on one chain before equivalent tokens were minted on another.

What did LayerZero tell KelpDAO about the setup?

According to the filing, LayerZero reviewed KelpDAO's draft code in February 2024 and told Evercrest it was "good," with "[n]o problem" using the default configuration. In March 2024, the filing alleges, LayerZero explicitly directed it to use a 1-of-1 setup with LayerZero's own verifier. By January 2025, LayerZero assured Evercrest that even a compromised verifier could at most fail to verify a message correctly.

The filing also alleges that LayerZero warned a separate developer, USDT0, about risks in its default verifier configurations in late 2024 or early 2025, prompting that project to run its own. Evercrest says it received no comparable warning.

How did the April exploit unfold?

The claim traces the attack to a LayerZero developer's machine. An attacker installed malware on a LayerZero developer computer on March 6, then tampered with LayerZero's nodes so they fed false readings to the verifier. On April 18, the attacker disabled the third-party nodes the verifier also relied on. With only one verifier required, the system accepted a false signal that 116,500 rsETH had been locked on Unichain when nothing had been. Unbacked tokens were minted.

Evercrest paused the bridges within roughly an hour and blocked a subsequent attempt, the filing states.

What is the defamation claim?

The dispute escalated after LayerZero's incident statement. LayerZero wrote that a single-verifier setup contradicted a multi-DVN model it had "consistently recommended to all integration partners," and Pellegrino posted that "[n]obody should be relying on sole DVN." Days later, the filing says, LayerZero acknowledged it had "made a mistake by allowing [its] DVN to act as a 1-of-1 DVN for high-value transactions."

Evercrest alleges those public statements placed blame on KelpDAO for a configuration LayerZero had itself prescribed. Pellegrino is sued personally for posts on Telegram and X.

What damages does Evercrest claim?

The claim cites a 2,000 ETH contribution Evercrest made to restore rsETH's backing, more than $650 million in withdrawals from the protocol since the exploit, and a decline in the KERNEL token that drew warnings from regulators and exchanges.

How has LayerZero responded?

Pellegrino said on X that the claim "continues to be meritless" and that he would meet Evercrest in court in Vancouver to defend himself. LayerZero has not filed a response. None of the allegations has been tested in court, and the pleadings phase in British Columbia now determines how quickly the dispute reaches discovery and any cross-border discovery into LayerZero's verifier infrastructure.