Judge Recommends Dismissal of Logan Paul’s Assistant in CryptoZoo Lawsuit
Legal Developments in the CryptoZoo Class Action Against Logan Paul
Jakarta, Pintu News – The class action lawsuit involving Logan Paul and the creators of CryptoZoo, a contentious NFT and cryptocurrency initiative, has progressed significantly. A magistrate judge in the United States has suggested that Danielle Strobel, Logan Paul’s former assistant, be removed from the lawsuit due to jurisdictional issues. This latest twist adds to the ongoing legal challenges within the cryptocurrency sector, including the disputes between Paul and YouTuber Coffeezilla.
Background on the CryptoZoo Case and Investor Claims
CryptoZoo was originally promoted as an NFT and Zoo token venture that offered a play-to-earn model built on blockchain technology. Investors were lured into purchasing NFTs and cryptocurrencies that were supposed to be utilized in a digital game that ultimately never materialized. The plaintiffs have accused the project of operating as a pump-and-dump scheme, where digital assets were marketed to the public without any intention of delivering the promised product.
Logan Paul, along with several associates, including Strobel, is named as a defendant in the case. Strobel reportedly holds a 1% founding stake in CryptoZoo, although she did not actively market the project. Her role has been described as administrative, and she received tokens at the project’s inception.
Reasons Behind Danielle Strobel’s Exclusion from the Lawsuit
Magistrate Judge Ronald C. Griffin determined that the Texas court lacked personal jurisdiction over Strobel, who currently lives in Colorado. Despite her status as a shareholder and her early involvement in the project, the judge concluded that there was insufficient evidence to prove that Strobel engaged in any direct or fraudulent actions that specifically harmed Texas residents.
The plaintiffs’ request to modify the lawsuit or pursue further discovery regarding jurisdiction was also rejected. The judge highlighted that Strobel’s participation was too minimal to meet the legal criteria for being sued in Texas. If the district judge accepts this recommendation, Strobel will be formally dismissed from the lawsuit without prejudice.
Ongoing Legal Battle: Logan Paul vs. Coffeezilla
In addition to the investor lawsuit, Logan Paul is embroiled in a defamation case against Stephen Findeisen, known as Coffeezilla. Coffeezilla is recognized for his video series that accuses Paul of perpetrating a scam through the CryptoZoo project. A previous ruling allowed this defamation case to move forward, as the term “scam” is interpreted as a factual statement rather than mere opinion, which could lead to legal defamation.
Coffeezilla has defended its position by asserting that its investigations are protected as constitutional opinions. However, the judge found that the way Coffeezilla framed its investigations and its audience reach warranted legal scrutiny.
CryptoZoo Project and NFT Refund Initiative
This class action lawsuit is just one of several legal challenges surrounding CryptoZoo. Amid the turmoil, Logan Paul initiated an NFT refund program aimed at compensating buyers of CryptoZoo NFTs. However, this refund initiative applies only to specific types of NFTs, and the compensation offered does not match the original purchase price due to fluctuations in Ethereum’s value, which currently stands at approximately USD 1,900 or IDR 30,833,200 per ETH (1 USD = IDR 16,228).
Many plaintiffs view the refund program as a partial remedy that fails to deliver on the promise of a “full return of the original purchase price” and excludes numerous owners of combined tokens and NFTs, thereby not addressing the fundamental issues leading to investor losses.
Insights on Crypto Cases and Legal Jurisdiction
The developments in this lawsuit illustrate that mere involvement in a cryptocurrency or NFT project does not automatically subject an individual to legal action, particularly when there is a lack of compelling evidence of active promotion or specific harmful actions within a given jurisdiction. The CryptoZoo case may establish a significant precedent for the cryptocurrency industry, especially concerning the boundaries of personal and jurisdictional liability in the unpredictable realm of digital asset investments.
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