FTX investors move to settle with SBF in exchange for information to go after celebrity boosters

Companies • April 19, 2024, 5:47PM EDT

Published 1 minute earlier on

Quick Take

Sam Bankman-Fried has knowledge that would be valuable to cases involving celebrities such as Tom Brady and Shaquille O’Neal.
A court would still need to sign off on the settlement.

A group of investors have agreed to settle their civil case against former FTX CEO Sam Bankman-Fried in exchange for his cooperation in their case against celebrities who promoted the platform.

In documents filed on Friday, the investors asked a Miami court to approve a settlement and said Bankman-Fried has knowledge that would be valuable to cases against other defendants including basketball player Shaquille O'Neal, businesswoman Gisele Bündchen, football star Tom Brady, and businessman Kevin O'Leary among a large list of others.

The documents were signed by Bankman-Fried, who was recently sentenced to 25 years in prison, and Adam Moskowitz, co-lead counsel for the class action lawsuit. Bloomberg first reported the news.

"While Class Counsel is aware that Defendant is currently incarcerated and has substantial restrictions on what he is permitted to do, and when, under the circumstances Defendant shall make his reasonable efforts to cooperate as follows," according to the settlement documents.

Requested documents

The investors want Bankman-Fried to hand over financial statements showing assets he owns, all "non-privileged documents in his possession relating to any investment by him in Anthropic PBC," as well as "non-privileged information" regarding a list of firms and people including law firm Sullivan & Cromwell and the celebrities involved.

FTX spent millions on marketing and advertising and signed deals with celebrities and organizations such as the MLB and the NBA's Miami Heat franchises.

The exchange later collapsed in 2022 and investors lost $8 billion.

Bankman-Fried was found guilty in November by a jury in New York of all seven criminal counts of defrauding the customers, lenders and investors of FTX. He was sentenced to 25 years in prison during a hearing last month.

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About Author

Sarah is a reporter at The Block covering policy, regulation and legal happenings. Before, Sarah was a reporter with CQ Legal writing about securities regulation, which is where she first started reporting on crypto. Sarah has also written for The Bond Buyer and American Banker, among other finance-related publications. She graduated from the University of Missouri and earned a degree in print and digital journalism. Sarah is based in Washington D.C., and is an avid coffee lover. You can follow her on Twitter @ForTheWynn.