In the world of cryptocurrency and NFTs, controversies and legal battles are not uncommon. One such case involves YouTuber Logan Paul and his failed crypto project, CryptoZoo. A recent development in the lawsuit against Paul has seen a US judge advising against allowing Paul to shift the blame onto his co-creators for the project’s failure.
Magistrate Judge Ronald Griffin has recommended that a federal court in Austin, Texas, deny Paul’s request for a default judgment against CryptoZoo co-founders Eduardo Ibanez and Jake Greenbaum. The lawsuit was brought forth by CryptoZoo non-fungible token buyers who alleged that the project was fraudulent.
Judge Griffin expressed concerns that granting Paul’s motion could lead to inconsistent judgments, as Ibanez and Greenbaum have not responded to the lawsuit. The group of NFT buyers initially sued Paul, Ibanez, Greenbaum, and others involved in the project, claiming that they were misled and promised benefits that were never delivered.
Paul, in his defense, filed a counterclaim against Ibanez and Greenbaum, alleging that they deceived him and ultimately caused the collapse of CryptoZoo. The project, which launched in 2021, featured NFTs and a token but failed to deliver on a promised blockchain-based game.
The judge emphasized that determining whether fraudulent acts were committed in the promotion and operation of CryptoZoo is crucial to the case. Granting default judgment against Ibanez and Greenbaum could jeopardize the claims against Paul and the other defendants, leading to potential inconsistencies in the legal proceedings.
In a separate legal battle, Paul is also entangled in a lawsuit with YouTuber Stephen Findeisen, known as “Coffeezilla,” who allegedly made defamatory remarks about CryptoZoo in a series of videos. The court allowed Paul’s complaint against Findeisen to proceed, adding another layer of complexity to the ongoing legal saga.
Despite the legal challenges, Paul took steps to address the concerns of CryptoZoo NFT buyers by offering refunds. In January 2023, he pledged to devise a plan for CryptoZoo’s future and set aside $2.3 million for refunds. Buyers were refunded 0.1 Ether (ETH), the same amount they initially paid for CryptoZoo tokens in 2021.
As the legal battles continue to unfold, the crypto community watches closely to see how the disputes will be resolved and what implications they may have for future projects in the industry. Stay tuned for updates on this evolving story.