$1 Billion Class-Action Suit Filed Against “FTX Influencers” for Alleged Fraudulent Promotion

A group of YouTubers and a talent management company are facing a class-action lawsuit that seeks $1 billion in damages for allegedly promoting FTX crypto fraud without disclosing compensation. The suit was filed by Edwin Garrison on March 15 in the Southern District of Florida, Miami Division.

The defendants in the suit are Kevin Paffrath, Graham Stephan, Andrei Jikh, Jaspreet Singh, Brian Jung, Jeremy Lefebvre, Tom Nash, Ben Armstrong, Erika Kullberg, and Creators Agency LLC. The suit alleges that the YouTubers were paid by FTX to promote the brand without disclosing the nature and scope of their sponsorships and/or endorsement deals, payments, and compensation.

The defendants are described as “influencers” who present themselves as real-life consumers who share authentic and valuable information with their followers. The suit accuses them of not conducting adequate due diligence on the FTX brand before promoting it to their followers.

One of the defendants, Ben Armstrong, has already taken to Twitter to declare that he never had any contact with anyone at FTX and never even had a reflink. He has also threatened a countersuit, calling the lawyers on this case “stupid.”

The lawsuit is a consolidation of several class-action suits, according to the law firm handling the case. Garrison’s suit was filed on November 15, 2022, and is the first-filed FTX-related class action filed in the country, the firm said. Garrison is also a plaintiff in the class-action suit filed against alleged celebrity endorsers of FTX.

The case is expected to generate significant attention and could have far-reaching implications for the influencer marketing industry. It highlights the importance of transparency and disclosure in influencer marketing and could serve as a wake-up call for influencers and brands alike.

The defendants have yet to release an official statement on the matter, and it remains to be seen how the case will play out in court. However, it is clear that the lawsuit has the potential to impact the influencer marketing landscape and could have significant financial consequences for those involved.

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