Evercrest Technologies, the company behind KelpDAO, has sued LayerZero Labs, its Canadian affiliate, and CEO Bryan Pellegrino in British Columbia over April's $292 million rsETH exploit.

The claim alleges negligent misrepresentation, negligence and defamation, seeks aggravated and punitive damages, and says Kelp users have withdrawn more than $650 million since the attack.

Pellegrino has called the suit meritless. By Aug. 4, projects tied to roughly $14.5 billion in assets had announced moves from LayerZero to Chainlink's CCIP , nearly 50 times the amount stolen.

The lawsuit now asks a court to settle a responsibility dispute that customers have been pricing on their own since April.

On April 18, attackers tricked LayerZero's verifier into approving a forged cross-chain transfer. LayerZero's incident report traces the intrusion to a developer who was socially engineered into cloning a malicious GitHub repository in March.

The attackers reached LayerZero's RPC environment, poisoned two internal nodes, and knocked an external RPC provider offline, so the verifier signed a message built on false source-chain data and 116,500 rsETH left Kelp's bridge .

That compromise succeeded because Kelp's bridge required approval from a single verifier, LayerZero's own, leaving one party able to authorize the release. The on-chain signature check worked as designed, since the signature was valid and simply attested to false information.

LayerZero's report splits the blame accordingly, assigning the number of required verifiers to the application and the compromised RPC layer to LayerZero as its operator.