Former FTX executive provides support to lawsuit against celebrity promoters

Former FTX Executive Supports Lawsuit Against Celebrity Promoters

A class action lawsuit has been filed against several celebrities who allegedly promoted the now-bankrupt cryptocurrency exchange FTX. The suit has received support from a former exchange executive, ex-compliance chief Daniel Friedberg, who provided evidence that promotional activity for FTX originated from Florida. Friedberg was the chief regulatory officer at FTX and the chief compliance officer of FTX US, the exchange’s United States arm.

The lawsuit’s proposed amended complaint, filed on May 11 in a Florida District Court, stated that Friedberg’s testimony could potentially rebut a key defense made by some of the defendants, who claimed that the Miami court had no jurisdiction and the claims had no association with Florida. In his sworn testimony, Friedberg said that FTX US’ vice president of business development, Avinash “Avi” Dabir, was based in Miami and was in charge of brand ambassadors for FTX, including some of the defendants in the case, such as former basketball player Shaquille O’Neal, comedian Larry David, retired NFL player Tom Brady, and FTX founder Sam Bankman-Fried. He further stated that Dabir operated from an FTX office in Miami “early in 2021,” which refutes the arguments made by the defendants in their motions to dismiss, according to the class action lawyers.

Some of the alleged promoters claimed that “no conspiracy could have been ‘engineered in Florida’ because FTX did not even plan to move to Miami until late September 2022,” which was before they entered into the alleged promotional agreements. The class action lawyers are using the new evidence to amend their lawsuit to try to address the jurisdictional claims by the suit’s defendants. The court will decide if the evidence is sufficient.

The suit was first filed in mid-November, shortly after the collapse of the exchange. Other alleged celebrity promoters include Brady’s then-wife and model Gisele Bündchen, entrepreneur Kevin O’Leary, and basketball star Steph Curry along with his team the Golden State Warriors. Friedberg was also named as a defendant in an amended complaint on Dec. 16. However, the former compliance head has reportedly lent a hand to other legal proceedings against the exchange he used to work for. Investigators with the New York District Attorney, the Justice Department, the Federal Bureau of Investigation, and the Securities and Exchange Commission purportedly got details about FTX from Friedberg a few weeks after the exchange collapsed.