Tom Brady, Larry David, other celebrities named in FTX suit

NEW YORK (AP) — Multiple Hollywood and sports celebrities, including Larry David and Tom Brady, have been named as defendants in a class-action lawsuit against cryptocurrency exchange FTX, arguing that their celebrity status makes them guilty of promoting the failed business model of the company.

FTX has been in the public eye for more than a week after the third-largest cryptocurrency exchange ended up with billions of dollars worth of losses and had to seeks bankruptcy protection in Friday. The Bahamas-based company and its founder, Sam Bankman-Fried, are being investigated by state and federal authorities for allegedly investing depositor funds in ventures without their approval.

Lawmakers too announced plans to investigate the failure of FTX, with the House Financial Services Committee saying it plans to hold a hearing on FTX in December.

Before it failed, FTX was known to use high-profile Hollywood and sports celebrities to promote its products. It had the naming rights to a Formula 1 racing team as well as the sports arena in Miami. Its commercials have featured “Seinfeld” creator David, as well as Brady, the Tampa Bay Buccaneers star quarterback, basketball players Shaquille O’Neal and Stephen Curry and tennis star Naomi Osaka.

The lawsuit, filed late Tuesday, alleges that these sports and television celebrities brought instant credibility to FTX and should be held just as culpable as Bankman-Fried.

“Part of the scheme used by the FTX entities involved using some of the biggest names in sports and entertainment — like these defendants — to raise funds and induce American consumers to invest … pouring billions of dollars into the fraudulent platform FTX to keep the entire scheme moving,” the lawsuit says.

Class action attorney Adam Moskowitz pointed to previous cases in which the US government fined celebrities Kim Kardashian and Floyd Mayweather for promoting crypto.

“The crypto industry needed celebrity endorsers to get any credibility,” Moskowitz said.

The plaintiff in the case is Pierce Robertson, who is also involved in a lawsuit involving Voyager Digital, another failed cryptocurrency company that was endorsed by Dallas Mavericks owner Mark Cuban. Voyager Digital did not receive bankruptcy protection this summer, but FTX has pledged to buy Voyager’s assets for $1.4 billion, which would provide financial relief to Voyager investors. FTX’s failure now calls his aid to Voyager into question.

The lawsuit was filed in the Southern District of Florida. Moskowitz is the attorney representing the victims of the Florida apartment tower collapse in Surfside, Florida.

Prominent attorney David Boyce, who represented the US government against Microsoft in the 1990s and Al Gore in the 2000 election, is also listed as a lawyer in the case.

The Miami Heat begin a four-game road trip in Toronto on Wednesday. Forward Udonis Haslem, also named in the lawsuit, is away from the team for personal reasons.

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Fatima Hussain in Washington and Tim Reynolds in Miami contributed.