Court Dismisses Claims Against Celebrities in FTX Lawsuit
A federal judge in Florida has dismissed most claims against high-profile figures, including celebrities like Tom Brady, Gisele Bündchen, Kevin O’Leary, and NBA star Stephen Curry, in the ongoing lawsuit related to the collapsed cryptocurrency exchange FTX. The ruling significantly narrows a wide-ranging multidistrict litigation that accused these public figures of leveraging their fame to endorse a platform alleged to be fraudulent.
The lawsuit emerged following FTX’s dramatic failure in November 2022, which resulted in billions of dollars in losses for investors and prompted global investigations into its operations. The plaintiffs argued that the celebrities were compensated millions for promoting FTX without adequately revealing their financial incentives, thus violating federal and state advertising laws.
In a ruling issued on Wednesday, U.S. District Judge K. Michael Moore determined that the plaintiffs failed to convincingly demonstrate that the "Celebrity Defendants" had sufficient awareness of FTX’s issues or the misconduct of its former CEO, Sam Bankman-Fried, that would warrant liability for their endorsements. As a result, almost all allegations against these high-profile endorsers were dismissed.
Additionally, similar claims against a group of social media influencers, referred to as the "YouTuber Defendants," were also largely dismissed. The court’s decision comes after a lengthy legal battle over allegations that these celebrities and influencers contributed to the promotion of unregistered securities and engaged in deceptive marketing practices.
While the ruling provides a significant relief to the defendants, the larger legal challenges stemming from FTX’s collapse continue to unfold, leaving many investors seeking recourse for the losses incurred during the exchange’s downfall.
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