Ex-Binance CEO Changpeng Zhao faces potential deposition in billion-dollar class action lawsuit Ex-Binance CEO Changpeng Zhao faces potential deposition in billion-dollar class action lawsuit
Plaintiffs are seeking early testimony from Zhao, who is set to be sentenced for his criminal conviction in February.
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Updated: Dec. 9, 2023 at 12:57 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
A court filing submitted on Dec. 8 indicates that former Binance CEO Changpeng Zhao could be deposed in the class action suit Sizemore v. Zhao,ย in which plaintiffs seek over $1 billion in damages.
The latest filing indicates that plaintiffs have moved for leave to take one deposition of Zhao, who is also a defendant in the case. Deposition means Zhao could provide sworn out-of-court testimony instead of appearing in court before a judge.
Adam Moskowitz, the lawyer for the plaintiffs, stated:
ย โWe have no idea how long CZ will be sentenced to prison, [it] could be 60 years or no years … If he gets no jail time, he certainly flees back to UAE. If he gets jail time, it is not easy to arrange and require a deposition from prison.โ
Moskowitz also said that the fact that Zhao has pleaded guilty to federal charges could support the class action suit. He noted that he was “certainly not involved” in any discussions between Zhao and the U.S. government.
Class action targets Zhao, endorsers, others
The class action suit against Zhao began in March 2023. It alleges that Zhao and other parties helped Binance carry out unregistered securities offerings. The suit, in part, concerns the company’s BNB token and BUSD stablecoin.
Initially, the lawsuit cited statements from the U.S. Securities and Exchange Commission (SEC) regarding BUSD in February as well as actions from the Commodities and Futures Trade Commission (CFTC) in March. Later, the complaint was amended to cite an SEC case against Binance that began in June 2023 and is still ongoing. It does not appear that the complaint has been amended to mention Binance’s November settlement with some U.S. agencies.
In addition to naming Zhao, Binance, and directly related entities as defendants, the suit also makes allegations against other parties. Notably, the class action names Paxos as a defendant for its role in issuing the BUSD stablecoin. It also names NBA player Jimmy Butler and former BitboyCrypto host Ben Armstrong as defendants, alleging that each was paid to endorse Binance.
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Mike Dalton
Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada's West Coast.
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Binance
Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
Changpeng Zhao, popularly known as “CZ,” is a notable figure in the cryptocurrency world, primarily for founding and leading Binance, the world’s leading cryptocurrency exchange by trading volume.
