FTX CEO, Golden State Warriors, celebs face more investor suits

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FTX class action lawsuits overview: 

• Who: Sunil Kavuri and Elliot Lam filed separate class action lawsuits against Sam Bankman-Fried, FTX founder and former CEO, Alameda CEO Caroline Ellison and FTX’s celebrity endorsers, including the Golden State Warriors, Stephen Curry and Tom Brady. 
• Why: Kavuri and Lam claim Bankman-Fried and his co-defendants deceived consumers into investing with the cryptocurrency platform FTX, which recently filed for Chapter 11 bankruptcy.
• Where: The class action lawsuits were filed in Florida and California federal court.   

Several class action lawsuits have collectively been filed against Sam Bankman-Fried, FTX founder and former CEO, Alameda CEO Caroline Ellison and FTX celebrity endorsers, including Tom Brady, Stephen Curry and the Golden State Warriors, among others. 

Plaintiffs Sunil Kavuri and Elliot Lam’s separate claims allege that individuals who invested in cryptocurrency with the recently bankrupt FTX were deceived by being offered unregistered securities. 

Kavuri, who filed his class action lawsuit in a Florida federal court, claims Bankman-Fried and a host of celebrity endorsers deceived him because he relied on alleged misrepresentations they made about investing with FTX. 

Kavuri called FTX’s demise “by far the largest securities national disaster” and argued that it could “become a complex international litigation disaster,” according to the FTX class action.

FTX filed for bankruptcy earlier this month after its entire $32 billion valuation was wiped “almost overnight” when investors attempted to mass withdraw funds from their accounts. 

Bankman-Fried, others accused of driving consumers into investing in Ponzi-like scheme

Lam, meanwhile, argues Bankman-Fried, along with the Warriors and Alameda Research CEO Caroline Ellison, got consumers to invest into what he claims was a Ponzi-like scheme that helped sell unregistered yield-bearing accounts. 

Lam claims Bankman-Fried, Ellison and the Warriors are guilty of civil conspiracy and fraudulent concealment and of violating California’s Unfair Competition Law and False Advertising Law. 

A similar class action lawsuit was filed against Bankman-Fried and a number of celebrity endorsers earlier this month, arguing they harmed investors with allegedly deceptive and unlawful conduct surrounding FTX. 

Have you been harmed by FTX declaring bankruptcy? Let us know in the comments! 

Lam is represented by William M. Audet, Ling Y. Kuang and Kurt D. Kessler of Audet & Partners LLP, Edward Lehman and Jacob Blacklock of Lehman Lee & Xu LLC and Robert L. Lieff.

Kavuri is represented by Adam M. Moskowitz and Joseph M. Kaye of the Moskowitz Law Firm PLLC and David Boies, Alex Boies, Stephen Neal Zack and Ursula Ungaro of Boies Schiller Flexner LLP.

The FTX class action lawsuits are Kavuri, et al. v. Sam Bankman-Fried, et al., Case No. 1:22-cv-23817, in the U.S. District Court for the Southern District of Florida, and Lam, et al. v. Sam Bankman-Fried, et al., Case No. 3:22-cv-07336, in the U.S. District Court for the Northern District of California. 

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