The FTX Collapse Litigation
What is the FTX Collapse Litigation?
The Hoda Law Firm is counsel to a putative class of depositors who lost their money in the FTX collapse. The case is Pierce v. Bankman-Fried, et al., Case No. 22-cv-07444 (N.D. Cal.).
The Pierce case has now been centralized with many other FTX-related class actions in what is known as a "Multidistrict Litigation (MDL)." The MDL is styled In re FTX Cryptocurrency Exchange Collapse Litigation, Case No. 23-md-03076 (S.D. Fla.), and is proceeding before Judge K. Michael Moore in the Southern District of Florida.
What are the claims in the case?
The Pierce lawsuit alleges that Sam Bankman-Fried, Caroline Ellison, Nishad Singh, and Gary Wang conducted a racketeering enterprise in violation of the Racketeering Influenced and Corrupt Organizations Act ("RICO").
The Pierce lawsuit further alleges that two auditing firms -- Armanino, LLP and Prager Metis CPAs, LLC -- conspired with the FTX enterprise and thus also violated the RICO Act.
Other FTX-related class actions centralized in In re FTX Cryptocurrency Exchange Collapse Litigation include claims against FTX's celebrity promoters, its venture-capital backers, other FTX insiders, and one of FTX's former law firms.
Is the Pierce case a class action? What does that mean?
Yes, the Pierce case is a class action. That means that the individual plaintiff (i.e., the person who initiated the lawsuit) will be asking the Judge to allow him to represent the entire group of people who, like him, were allegedly harmed by the defendants' conduct.
The Pierce case has not reached the "class certification" stage, so it remains to be seen whether the Judge will allow the case to proceed as a class action.
What does it mean for cases to be centralized in Multidistrict Litigation?
Multidistrict litigation is a special legal procedure designed to help our judiciary handle complex cases. MDL cases occur when geographically disparate civil lawsuits involving common factual issues are centralized before a single judge. The cases subject to MDL remain before the "transferee judge" for all pretrial proceedings and discovery. If a case is not settled or dismissed in the "transferee" court, it is then sent back to the "transferor" court for trial.
How long has the Pierce case been pending? What about the multidistrict litigation?
The Hoda Law Firm filed the Pierce case on behalf of our client and the proposed class on November 23, 2022.
The Judicial Panel on Multidistrict Litigation issued its order centralizing many FTX-related cases on June 5, 2023.
What is The Hoda Law Firm's role in the FTX Litigation?
Our founder, Marshal Hoda, was recently appointed Co-Chair of the eDiscovery Committee in the FTX multidistrict litigation. This means that Marshal is responsible for the monumental task of developing, managing, and prosecuting an MDL-wide discovery and review strategy spanning dozens of class-action cases involving tens of millions of pages of documentary evidence.
What should I do if I also lost money in the FTX collapse?
If you also lost money during the collapse of FTX or FTX US, we want to hear from you. It is important that everyone have their voices heard. Fill out our contact form or give us a call at (832) 848-0036. We are here to listen and give you guidance.
Practice area(s): Civil Litigation
Court: Southern District of Florida