Key Testimony in FTX Lawsuit
Daniel Friedberg, the former top compliance chief for FTX and FTX US, has provided a declaration that could bolster the lawsuit against celebrities who allegedly promoted the now-bankrupt FTX. This class action lawsuit has gained significant traction with Friedberg’s cooperation.
The Role of Florida in the FTX Scandal
A proposed amended complaint filed in a Florida District Court on May 11 stated that Friedberg has provided evidence suggesting that promotional activities for FTX were orchestrated from Florida. This is significant as some defendants have claimed the Miami court lacks jurisdiction, asserting that their claims have no connection with Florida.
Uncovering FTX’s Internal Operations
Friedberg was the chief regulatory officer at FTX and the chief compliance officer of FTX US, the exchange’s United States subsidiary. His sworn testimony revealed that FTX US’ vice president of business development, Avinash “Avi” Dabir, was based in Miami and oversaw brand ambassadors for FTX. This included high-profile defendants such as former basketball player Shaquille O’Neal, comedian Larry David, retired NFL player Tom Brady, and FTX founder Sam Bankman-Fried.
The Defendants’ Counterclaims
The defendants have argued 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 the alleged promotional agreements were established. However, the plaintiffs’ lawyers argue that Friedberg’s testimony refutes these claims.
More Celebrity Promoters Under Scrutiny
The suit was first filed in mid-November, shortly after the collapse of the exchange. Other alleged celebrity promoters include model Gisele Bündchen, entrepreneur Kevin O’Leary, and basketball star Steph Curry along with his team the Golden State Warriors.
Friedberg: A Key Player in Multiple Legal Proceedings
Interestingly, Friedberg himself was named as a defendant in an amended complaint on Dec. 16. Despite this, he has reportedly been assisting with other legal proceedings against FTX, his former employer. The New York District Attorney, the Justice Department, the Federal Bureau of Investigation, and the Securities and Exchange Commission have purportedly obtained detailed information about FTX from Friedberg in the weeks following the exchange’s collapse.
The court will decide if the evidence is sufficient. Meanwhile, the class action lawyers are using the new evidence to amend their lawsuit to counter the jurisdictional claims by the suit’s defendants.