A legal dispute regarding the governance of Ondo Finance has escalated further following the death of founder Nathan Allman, who passed away intestate and left his parents as beneficiaries of an estate featuring a controlling equity position as well as an extensive portfolio of ONDO coins.
The mother of Allman, Kathleen Allman, initiated legal action against interim CEO Ian De Bode concerning what she claims was a tactical bid to seize corporate authority and obtain an executive compensation package valued close to $11 million.
Conversely, Allman’s half-sister alongside Ondo investor David Chen are pursuing a restricted conservatorship over Kathleen Allman’s portion of the estate, citing cognitive decline and fiscal irresponsibility, assertions she strongly refutes.
The leadership crisis at Ondo Finance following the untimely passing of its young founder Nathan Allman has grown increasingly convoluted as relatives engage in litigation against interim CEO Ian De Bode and additionally clash amongst themselves.
Dr. Lani Clinton, the half-sister of Allman, together with Ondo backer David Chen, filed a petition in a Hawaiian tribunal to institute a restricted conservatorship over the 77-year-old mother Kathleen Allman’s segment of the Ondo Founder estate, which contains a controlling equity stake in Ondo Finance alongside an expansive treasury of ONDO tokens encompassing both available coins and assets vesting across the upcoming three years.
Through a legal submission dated September 16, Kathy Allman accused opposing parties of forum shopping after they failed to oust her from the Ondo board or restrict its powers. She claimed that De Bode and Chen coordinated efforts to substitute her with a more compliant fiduciary while stalling the Delaware litigation, emphasizing that Chen is financing the separate Hawaii petition, shares legal representation with De Bode, and utilized confidential documents originating from the Delaware case.
Furthermore, the filing highlighted that the Delaware tribunal had previously dismissed De Bode’s contention that Kathy and Tahnee Towill lacked qualifications to function as board members.
Nathan Allman passed away abruptly without leaving a will at the age of 32 in May, leaving his estate, which includes his Ondo Finance holdings, in an unsettled state. A probate tribunal subsequently designated his parents, Kathleen Allman and Lawrence Allman, as legal heirs.
Following Allman’s demise, De Bode assumed leadership at Ondo. Shortly after De Bode stepped into the role of acting CEO, Allman’s mother appointed herself alongside another offspring, Tahnee Towill, to the Ondo board of directors, designated herself chair alongside interim CEO, and attempted to strip him of all corporate titles, though he maintains his position as acting CEO and board member per a September 3 judicial directive.
Ondo Finance declined to provide remarks, and telephone attempts by CoinDesk directed at De Bode went unanswered.
Kathleen Allman subsequently launched legal proceedings against De Bode, characterizing his actions as an overt usurpation of corporate authority and asserting that he began plotting a novel compensation package totaling $11 million within a single week of Allman’s death. Her lawsuit aims to establish that De Bode and Chen, an early Ondo supporter whom De Bode attempted to seat on the board, were improperly appointed, declares the contested remuneration packages null, and seeks financial damages for alleged breaches of fiduciary responsibilities.
De Bode’s remuneration agreement encompassed a yearly salary and bonus totaling $900,000, a signing bonus of $1 million, alongside 26 million restricted token units estimated at upwards of $9 million, according to Allman’s lawsuit. The agreement additionally incorporated grants spanning 846,000 shares which would have elevated his equity share from 0.33% to 8%, representing an approximate 24-fold increase. Vesting schedules were slated to commence on May 25, exactly one day after Allman’s death.
The estate’s legal complaint remarked that the writers of Game of Thrones could not have scripted Ian’s usurpation of power any better.
Nevertheless, fresh legal documentation casts doubt upon Kathleen Allman’s mental competency. Dr. Clinton, a medical professor at Duke University, informed the presiding judge that her mother struggles with a persistent alcohol dependency alongside a progressive decline in executive capacity, decision-making, perception, and social cognition, leaving her incapable of overseeing property and commercial business operations of such scale and importance.
In a formal statement issued to CoinDesk via her attorneys, Kathleen Allman repudiated the claims made within the petition, labeling them unfounded and stating that the Hawaii petition was submitted by an associate of Mr. De Bode as a desperate maneuver after his bids to seize command of Ondo and illicitly enrich himself were ruled invalid by the Delaware Court of Chancery. She expressed confidence that this recent undertaking would meet a similar fate, noting that Kathleen has prioritized sound governance from day one and remains dedicated to supporting the long-term prosperity of Ondo while honoring the vision and principles of her son Nate Allman.
Aside from alleging that her mother maintains a decades-long habit of consuming alcohol at pathological levels, Dr. Clinton requested that the judiciary examine her mother’s medical files and screen her for dementia, arguing within the legal papers that behavioral patterns observed over recent years align with the behavioral variant of frontotemporal dementia.
Within her legal filing, Dr. Clinton asserted that she had been estranged from her mother since 2022 following an episode during a family holiday where Kathleen Allman allegedly told Dr. Clinton’s young children, aged 10, six, and two, that they were worthless, that she should have aborted all of them, and that she might be fortunate if they drowned in the ocean during the trip. Afterward, Kathleen Allman denied uttering any such remarks, as noted in the documentation.
The court records likewise point toward a trend of extravagant expenditures, indicating that Kathleen Allman grew reliant on Allman for a standard of living that her personal finances could never sustain. In June 2025, according to court documents, Allman acquired a beachfront residential property in Honolulu for his parents at a cost of $18.5 million.
Legal counsel representing Dr. Clinton and Chen stated in their filing that petitioners also highlight that despite substantial earnings, Kathleen Allman exhibits a history of financial difficulty, including an instance where she failed to cover a single month of mortgage payments and borrowed funds from her own mother.
Prior to Allman’s passing, the records assert that Kathleen Allman acquired or tried to secure a Zeelander yacht located in Florida valued at approximately $4 million, traveled via private aviation including a request that Ondo Finance cover a six-figure expense for a flight originating in Hawaii bound for California, and stayed at accommodations costing roughly $4,000 per night.
Nine days subsequent to her son’s passing, records indicate that Kathleen Allman transmitted a text message to Chen stating that she felt confident everything would sort out in time, but her primary concern was cash flow and liquidity immediately, noting she had a $200,000 invoice from contractors building a pool in Newport and genuinely wanted to secure that boat and other items.
Read more: Power struggle erupts at Ondo Finance after founder’s death
UPDATE (Sept. 17 23:10 UTC): Updates story with additional detail about the Sept. 16 filing made by the estate.
The Definitive Stablecoin Landscape Series: Asia Pacific
The Definitive Stablecoin Landscape Series: Asia Pacific
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
Sep 15, 2026
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
Why it matters:
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
View Full Report
Originally published at https://www.coindesk.com/business/2026/09/17/the-ondo-finance-succession-crisis-gets-messier-as-kathleen-allman-s-daughter-alleges-dementia-alcoholism-and-reckless-spending.
