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In a new development, the infamous “crypto king” Sam Bankman-Fried is preparing to take legal action against celebrities such as Tom Brady and Larry David. These celebrities had endorsed his now-failed FTX cryptocurrency exchange.

Bankman-Fried, currently serving a 25-year prison term for fraud, faced accusations of deceiving investors and customers of his company FTX. Once valued at $32 billion with over a million users, FTX crumbled when a CoinDesk report exposed that a significant portion of its assets were held by Alameda Research, a quantitative trading firm owned by Bankman-Fried.

Following the revelation, a massive withdrawal of funds ensued, laying bare an $8 billion deficit within the company. Subsequently, a group of investors and customers initiated a class-action lawsuit against Bankman-Fried and the celebrities he enlisted to endorse FTX, aiming to recoup their losses from the crypto platform’s collapse.

The lawsuit, filed in the US District Court’s Southern District of Florida, alleges that Bankman-Fried and celebrities like NFL icon Tom Brady and comedian Larry David bear responsibility for approximately $11 billion in losses suffered by American consumers.

While Brady and his former spouse Gisele Bundchen appeared in a 2022 FTX commercial, David starred in a high-budget Super Bowl ad for the company. Other sports luminaries, including Stephen Curry, Shaquille O’Neal, and Naomi Osaka, also featured in FTX promotions.

Bankman-Fried, originally a defendant in the lawsuit, recently agreed to collaborate with the plaintiffs by providing assistance in exchange for dropping civil liability claims against him. This cooperation could potentially lead to revelations implicating some of the celebrity endorsers.

The lawsuit suggests that Bankman-Fried aid in prosecuting FTX influencers and contribute to victim restitution by disclosing all non-privileged documents and testimonies from his criminal trial.

However, the extent of damages the celebrities might face remains uncertain, given that they were compensated by Bankman-Fried to enhance his crypto empire’s visibility.

Described in the 41-page lawsuit as individuals who played active roles in FTX’s operations, the celebrities are accused of violating Florida laws by participating in the deceptive and failed FTX platform.

Bankman-Fried’s conviction in November 2023 on multiple charges, including fraud and embezzlement, led to a 25-year prison sentence and a forfeiture of $11.2 billion. Despite expressing remorse for the company’s downfall during his sentencing, the judge noted a lack of full accountability on Bankman-Fried’s part.

Following FTX’s collapse, Bankman-Fried has focused on returning assets to customers, aiming to make them whole at current market prices, as stated by Mark Botnick, a spokesperson for Bankman-Fried.