A former Xsolla Inc. executive has dropped his lawsuit in which he alleged he was wrongfully fired last summer for reporting alleged internal financial irregularities, including a disbursement of funds from the video game commerce company for a loan to a private account held by the firm’s founder.
Plaintiff Emil Aliyev’s Los Angeles Superior Court lawsuit alleged whistleblower retaliation and wrongful termination. On Wednesday, his attorneys filed court papers with Judge Timothy Patrick Dillon asking that their client’s case be dismissed “with prejudice,” meaning it cannot be refiled.
The court papers do not state if Aliyev reached a settlement with the Sherman Oaks-based company or if he was not pursuing the case for other reasons.
Aliyev was hired last April 17 as Xsolla’s vice president of global accounting and has more than two decades of experience in financial regulations. His job in large part was to ensure Xsolla’s compliance with applicable financial rules and regulations, the suit stated.
However, shortly after taking the job, Aliyev noticed Xsolla had not passed an IRS audit since roughly 2017 and in May 2023, he learned of alleged illegal financial activity on behalf of Xsolla regarding its account balance deficiencies, including $40 million dollars that was missing between two account balances, according to the suit.
Further investigation by Aliyev showed Xsolla had made several monetary disbursements from company funds to a private Goldman Sachs account held by Xsolla’s founder, Alexander Agapitov, the suit alleged.
Aliyev reported his findings to Xsolla CEO Leon Perry, telling him it was unlawful for the company to provide Agapitov with monetary loans without charging a standard interest rate, the suit stated.
He also maintained that Xsolla failed to report the approximately $40 million loan to Agapitov to the IRS and although Perry did not dispute the plaintiff’s findings, he told the plaintiff, “It is not your problem,” the suit stated.
In July, Aliyev met with Agapitov and Ketei Marakool, whom the plaintiff would later learn was Xsolla’s new CFO, the suit stated. Like Perry, Marakool acknowledged the issues addressed by Aliyev, but she and Agapitov also took no action to correct the problems, according to the suit.
Aliyev was fired three days after his meeting with Agapitov and Marakool and was told in a subsequent meeting with Perry and a member of human resources that he lost his job “due to an alleged violation of company policy,” the suit stated.
Aliyev’s inquiries about what policy he violated were unanswered, the suit filed Nov. 22 stated.
Aliyev complained to management in August that he was being unlawfully terminated for reporting financial mishandling, but Xsolla refused to investigate or reinstate him, the suit alleged.