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WE WROTE YESTERDAY about Washington insiders — mostly Democrats — who have been tainted by their acceptance of FTX money, and are scrambling to give it back. Now the focus is shifting to litigation aimed at celebrity endorsers of the crypto firm.
AGGRESSIVE LAWYERS SMELL A HUGE PAYDAY — not against FTX executives, who are broke and may face jail time — but against celebrities who still have deep pockets. The Washington Post and others are reporting that lawsuits are likely, targeting stars who pitched FTX as a safe investment.
AT THE TOP OF THIS CELEBRITY LIST is Tom Brady, the seven-time Super Bowl champion, and his ex-wife Gisele Bündchen. They soon may become defendants in a class-action lawsuit taking shape from aggressive attorney Adam Moskowitz that will claim the celebrities steered unwitting investors into the FTX fiasco.
OTHER CELEBRITIES who are considered potential targets of a class action case include retired basketball star Shaquille O’Neal, current star Stephen Curry, NFL quarterback Trevor Lawrence, retired baseball slugger David Ortiz, current phenom Shohei Ohtani, and comedian Larry David. The Dallas Mavericks and owner Mark Cuban also may face lawsuits stemming from their crypto endorsements.
FTX HAD PARTNERSHIPS with NBA teams, had their patches on Major League Baseball umpire uniforms and the naming rights to the Miami Heat basketball arena. FTX ran TV ads during NBA and National Football League games, including last year’s Super Bowl. Celebrities like Brady who appeared in the ads assured viewers that FTX was a safe investment.
TO BE FAIR, MOST LEGAL EXPERTS believe there’s high bar to clear in these types of lawsuits. In many states, endorsers aren’t held liable unless there’s proof they knew of deliberate deception by the firms that they endorsed. But this will not dissuade Moskowitz, who just added superstar attorney David Boies to his legal team.
BUDGET UPDATE: The Senate is virtually certain to set a new deadline for passing a massive omnibus spending bill — Dec. 23. Everyone on Capitol Hill wants a piece of this action, on issues ranging from Electoral College reform to the child tax credit to energy project permitting. And there’s plenty of pork in the mix.
BITTERLY DIVIDED REPUBLICANS are the wild card in this narrative. GOP conservatives want to wait until next year to take up a spending package, when they will have control of the House and probably could block major new spending. They’re furious at Senate Minority Leader Mitch McConnell, who wants to pass a huge omnibus bill next week. Among other things, it would fund outlays for defense and Ukraine.
WE’LL BET ON McCONNELL, who has the votes in the Senate and probably the House. But for moderates like him, this may be the last hurrah on spending. With the budget deficit surging, a more austere spending climate appears likely, starting next year.
THUS IT APPEARS that fiscal policy will be tight next year — and after listening to Jerome Powell yesterday, it looks like monetary policy will be tight as well.
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