High Profile Case Against FTX Promoters Silently Dropped

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Sam Bankman-Fried, the ex-CEO of the collapsed cryptocurrency exchange FTX, and a number of celebrities who were paid to promote the company have been cleared as defendants in a class action case.

Lead plaintiff Edwin Garrison’s attorneys filed a notice of voluntary dismissal with the U.S. District Court for the Southern District of Florida on Thursday.

The original Miami lawsuit said that FTX was a “house of cards, a Ponzi scheme where the FTX entities shuffled customer funds between their opaque affiliated entities.”

According to the notice, none of the defendants in the lawsuit, including Bankman-Fried, NFL quarterback Tom Brady, comedian Larry David, tennis player Naomi Osaka, and the Golden State Warriors team from the NBA, had been served with the summons or the complaint. 

Previously, Garrison had claimed that while attracting U.S. investors with high yield accounts, FTX was actually a “Ponzi scheme” in which money was moved around among affiliated companies to give the impression of stability.

In his case, Garrison also mentioned Kardashian and others for their involvement in promoting the tokens, as well as a ruling from the 11th U.S. Circuit Court of Appeals in February that permitted investors in BitConnect cryptocurrency to sue persons who marketed the coin online.

His lawsuit claims Bankman-Fried and FTX promoters plotted to deceive investors and broke Florida law by not registering their securities and engaging in unfair business practices.

Celebrities Under Regulatory Crosshairs For FTX Promotion

Many celebrities are eyed by regulatory agencies after the FTX demise. In November, Texas’s financial regulator was looking into Brady and NBA point player Stephen Curry.

They’ve both been charged with violating securities laws for their roles in promoting and advertising the defunct bitcoin exchange. 

The Texas State Securities Board’s director of enforcement, Joe Rotunda, said to be looking into the payment that these celebrities received for endorsing the FTX United States brand.

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