March 29, 2024
FTX Former Execs Settle Class Lawsuit for $1.3M
Latest Cryptocurrency News

FTX Former Execs Settle Class Lawsuit for $1.3M

A recent development in the ongoing saga surrounding FTX, a prominent crypto exchange, reveals that former executives and promoters have agreed to a substantial settlement amounting to approximately $1.36 million. This settlement comes in response to a class action lawsuit initiated by former investors seeking recompense for alleged fraudulent activities.

Co-founder of FTX, Zixiao “Gary” Wang, along with former engineering lead Nishad Singh and Caroline Ellison, ex-CEO of sister trading firm Alameda Research, have opted to cooperate with the lawsuit. The terms of the settlement, presented in a Miami federal court bid on March 27, outline their agreement to provide information to aid in resolving the claims against them.

A highlighted excerpt of Ellison’s settlement notes her testimony against former boyfriend Sam Bankman-Fried could help the suit — the FTX MDL (multidistrict litigation). Source: PACER

Although the former executives have not admitted to any of the allegations put forth in the lawsuit, they have agreed to collaborate based on the belief that their insights and information could bolster the case against other defendants, including celebrities, companies, and venture capitalists.

Cooperation and Disclosure

As part of the settlement, Wang, Singh, and Ellison have committed to sharing all non-privileged documents and data pertinent to the case. This cooperation extends to their involvement in assisting prosecutors in the apprehension of Sam Bankman-Fried, their former superior, who was sentenced to 25 years for fraud.

Furthermore, the trio has agreed to participate in depositions and hearings, providing additional records relevant to FTX’s bankruptcy proceedings. Their cooperation also extends to forfeiture of assets, with the judge overseeing their criminal case tasked with determining the recovery and distribution of funds to victims.

Resolution and Settlement Agreements

In addition to the former executives, settlements were reached with seven influencers and Daniel Friedberg, former FTX chief regulatory officer and FTX.US chief compliance officer. Friedberg, though not admitting to any knowledge of the fraud, has voluntarily provided valuable information to the class action group and will continue to do so.

Several prominent figures, including YouTubers and influencers, have also agreed to settlements. Brian Jung, Kevin Paffrath, Tom Nash, Graham Stephan, Jeremy LeFebvre, and Andrei Jikh have contributed varying amounts to resolve the lawsuit. Notably, American football star William Trevor Lawrence’s settlement amount, though undisclosed, is estimated to be approximately $1 million based on the total relief disclosed minus the sums from other agreements.

Release from Claims

All parties involved in the settlements, including the former executives, influencers, and celebrities, have been released from any claims related to the alleged conduct giving rise to the litigation. This comprehensive resolution marks a significant step forward in addressing the complexities surrounding FTX’s tumultuous past.

Image by Arek Socha from Pixabay

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