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FTX Investor Files Suit Against Sequoia Capital, Thoma Bravo, Paradigm

Posted on March 3rd, 2023 at 2:18 PM
FTX Investor Files Suit Against Sequoia Capital, Thoma Bravo, Paradigm

From the Desk of Jim Eccleston at Ä¢¹½´«Ã½

A cryptocurrency investor has filed suit against private equity firms including Sequoia Capital, Thoma Bravo, and Paradigm for improperly touting the legitimacy of FTX. 

The firms collaborated on a 2021 marketing campaign to hype their own investments in FTX entities, according to the proposed class-action complaint. The complaint alleges that the marketing campaign contributed an “air of legitimacy” to the business that subsequently filed for bankruptcy while the co-founder, Sam Bankman-Fried, now faces criminal charges.  Sequoia in particularly has attracted heightened scrutiny as it previously published a 14,000-word profile about the entrepreneur titled “Sam Bankman-Fried Has a Savior Complex — And Maybe You Should Too.” 

The firms claim to have conducted sufficient due diligence of FTX’s operations before Thoma Bravo invested more than $100 million while Paradigm invested at least $250 million, according to the complaint, which was filed in federal court in San Francisco. The class-action complaint alleges several violations of state and federal law, including misrepresentation, false advertising, and civil conspiracy. 

Ä¢¹½´«Ã½ LLC represents investors and financial advisors nationwide in securities, employment, regulatory and disciplinary matters.

Tags: Eccleston, Ä¢¹½´«Ã½

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