Judge Dismisses Most Claims Against Celebrities in FTX Lawsuit
In a significant ruling, a Florida federal judge has dismissed the majority of claims against numerous high-profile celebrities and social media influencers, including Tom Brady, Gisele Bündchen, Kevin O’Leary, and NBA star Stephen Curry, linked to the now-defunct cryptocurrency exchange FTX. This decision narrows a broad multidistrict litigation that accused these public figures of using their fame to promote a fraudulent platform.
The lawsuit originated from FTX’s dramatic collapse in November 2022, which resulted in the loss of billions of dollars in investor funds, igniting global investigations. Plaintiffs claimed that the celebrities received substantial payments to endorse FTX without adequately disclosing their financial ties, allegedly in violation of federal and state advertising regulations.
On Wednesday, U.S. District Judge K. Michael Moore ruled that the plaintiffs failed to show that the celebrities had sufficient awareness of FTX’s practices or the misconduct of its CEO, Sam Bankman-Fried, to be held accountable for their endorsements. Consequently, the court dismissed most claims against what it termed the "Celebrity Defendants," as well as the "YouTuber Defendants," who had also marketed FTX via social platforms.
The ruling marks a crucial development in a lengthy legal struggle, as plaintiffs contended that these stars were liable for endorsing unregistered securities and engaging in deceptive marketing. By dismissing a bulk of the litigation, the court has significantly reduced the legal burdens facing the involved celebrities and influencers.
This ruling emphasizes the complexities surrounding celebrity endorsements in the rapidly evolving cryptocurrency landscape, raising essential questions about disclosure and accountability within the marketing of financial products.
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