Apolo Ohno Cryptocurrency Fraud Class Action Overview:
- Who: Retired Olympic speed skater Apolo Ohno has escaped a class action lawsuit brought by investors in a cryptocurrency company he founded.
- Why: The judge ruled the investors filed the lawsuit too late.
- Where: The lawsuit was filed in California federal court.
Retired Olympic speed skater Apolo Ohno has escaped a class action lawsuit alleging a cryptocurrency company he co-founded sold fraudulent tokens.
In an order filed Feb. 15 in a California federal court, U.S. District Judge Mark C. Scarsi granted Ohno’s motion to dismiss the class action complaint filed against him by buyers of Hybrid Trade Ltd.’s digital token, known as “Hybrid Tokens.”
In the order, Judge Scarsi said the investors had filed their lawsuit too late.
According to the complaint, which was filed Aug. 31, 2021, Ohno, Hybrid Trade and others raised about $50 million by selling the tokens despite not having registered the offer and sale with the Securities and Exchange Commission.
The plaintiff, Brian Kang, says they misled investors by “delivering on none of the promises made in the offer of sale.”
Kang also alleges electronic wallets were breached and approximately $4.4 million of cryptocurrency was stolen, but that the defendants did nothing about it.
After hiring a company to do a report, Kang concluded that Ohno and others had “misappropriated approximately $20 million of investor funds.”
“The report ultimately concluded that Defendants had ‘very little to show’ for the approximately $50 million in investor funds raised,” Kang says.
Crypto Plaintiff Says He Lost More Than $1.4 Million
Despite the allegations, Judge Scarsi said, under the Securities Act of 1933, the investors had one year from the alleged conduct to file some claims and two years from other claims.
However the plaintiffs had missed the boat on all claims, so the case was time-barred.
Kang said he invested more than $1.4 million on behalf of himself and two entities he controls, all of which was lost.
“Defendants squandered and/or misappropriated, and purported to lose by theft, all or nearly all of the approximately $50 million raised through their offer and sale of Hybrid Tokens,” the complaint said. “Defendants’ offer and sale of Hybrid Tokens was, in actuality, a mere vessel for defendants’ personal enrichment.”
The defendants were accused of selling unregistered securities to U.S. investors, securities fraud, intentional and negligent misrepresentation and breach of contract.
In other securities news, a Yelp Inc. shareholder has asked a judge to approve an $18 million settlement with three of the review company’s executives after alleging the trio lied about how well the business was doing.
What do you think about the claims in this case being time-barred? Let us know in the comments!
The investors are represented by Farhad Novian, Alexander B. Gura and Anthony S. Chavez of Novian & Novian LLP.
The Ohno Cryptocurrency Class Action Lawsuit is Brian Kang et al. v. Hybrid Trade Ltd. et al., Case No. 2:21-cv-06593, in the U.S. District Court for the Central District of California.
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