The First FTX Lawsuit – Class Action Crypto

On November 15, 2022, the CEO of FTX and various alleged celebrity endorsers were sued in Florida federal court by Edwin Garrison, an FTX investor. In the complaint, Garrison alleges that FTX engaged in the unlawful sale of a security (in this case, FTX's interest-bearing crypto accounts), deceptive and unfair business practices, and participation in a civil conspiracy he compares to a "Ponzi scheme." Specifically, the complaint states FTX ran a "fraudulent scheme" designed to take advantage of "unsophisticated investors." Garrison claims investors have collectively sustained $11 billion in losses. In his complaint, Garrison applied to have the investors certified as a class, which would allow the lawsuit to proceed as a class action lawsuit.