Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 1 of 27
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF FLORIDA
`MIAMI DIVISION
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`CASE NO. 1:22-cv-23753-KMM
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`EDWIN GARRISON, et al., on behalf of
`themselves and all others similarly situated,
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`Plaintiffs,
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`v.
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`SAM BANKMAN-FRIED, et al.,
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`Defendants.
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`JOINT SCHEDULING REPORT
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`Plaintiffs, Edwin Garrison, et al. (“Plaintiffs”), and Defendants, Thomas Brady, Gisele
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`Bündchen, Stephen Curry, Lawrence David, Golden State Warriors, LLC (“GSW”), Udonis
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`Haslem, William Trevor Lawrence, Shohei Ohtani, Kevin O’Leary, David Ortiz, Naomi Osaka
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`(collectively, the “Non-FTX Defendants”), and Sam Bankman-Fried (collectively, the “Appearing
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`Defendants”)1 (Appearing Defendants together with Plaintiffs, the “Parties”), submit this Joint
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`Scheduling Report pursuant to S.D. Fla. Local Rule 16.1(b), and Federal Rule of Civil Procedure
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`26(f)(3).
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`The Parties conferred on April 28, 2023. The Non-FTX Defendants have moved to stay all
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`discovery pending resolution of their pending motions to dismiss (ECF 162). With respect to the
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`issue of jurisdictional discovery, Plaintiffs’ position is as proposed in their pending motion for
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`1 Defendants Caroline Ellison, Gary Wang, Nishad Singh, and Dan Friedberg have not yet
`appeared. Defendant Shaquille O’Neal has recently retained counsel Colson LLP and Latham &
`Watkins, LLP, and will be making his initial appearance today. Because he had not yet obtained
`representation, Mr. O’Neal did not participate in the Parties’ Rule 26 conference.
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 2 of 27
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`leave to conduct jurisdictional discovery (ECF 163). With respect to the issue of merits discovery,
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`Plaintiffs take no position and leave it to the Court’s discretion what discovery, if any, should be
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`permitted pending a decision on the motions to dismiss or any transfer ordered by the Judicial
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`Panel on Multidistrict Litigation. If the Court decides that discovery should be stayed pending the
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`motions to dismiss, then the Parties suggest that the case schedule should be set either after the
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`resolution of those motions or upon MDL consolidation, if that occurs. In the event the Court
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`denies a stay of discovery, or prefers to have a schedule set notwithstanding any such stay of
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`discovery, the Parties’ report below provides the respective proposed schedules by the Plaintiffs
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`and the Non-FTX Defendants. The Parties report as follows:
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`I.
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`Plaintiffs’ Statement
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`The FTX disaster is the largest financial fraud in US history. The former FTX CEO,
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`Bankman-Fried, is facing numerous criminal charges and the new CEO—who helped wind down
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`Enron—concluded that the FTX fraud surpassed Enron. Billions of dollars have been stolen from
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`investors across the globe.
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`FTX was a centralized cryptocurrency platform which specialized in derivatives and
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`leveraged products. It filed for bankruptcy protection in November 2022 and will be involved in
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`federal bankruptcy proceedings for many years. There is no guarantee that any of the victims will
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`be able to see any recovery from those proceedings.
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`This is a proposed class action brought on behalf of a Global Class, a Nationwide Class,
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`and State Subclasses, of all individuals offered or sold, deceptive FTX Yield Bearing Accounts
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`(“YBAs”) or FTX’s native cryptocurrency token (“FTT”), which were admittedly marketed and
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`2
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 3 of 27
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`promoted by the Defendants.2 Plaintiffs allege—as the SEC and numerous state securities
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`regulators have similarly concluded in analogous contexts with platforms such as BlockFi,3
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`Voyager,4 and Celsius,5 who all offered these same accounts and native cryptocurrency platform
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`tokens—that these YBAs and FTT are all unregistered “securities” as defined by applicable
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`securities law.
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`Defendants’ participation and/or actions in FTX’s offerings and sales of YBAs and FTT
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`violated various provisions of state securities laws and deceptive trade practices statutes, including
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`those of Florida, which law may be applied nationwide as Florida is the situs of FTX’s domestic
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`headquarters and Florida’s FSIPA and FDUTPA statutes were enacted to regulate the conduct of
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`entities based within its borders so that such companies would not utilize the State as a hub for
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`their global wrongdoing. Plaintiffs seek certification of a Global Class, a Nationwide Class, and a
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`Florida State Subclass under Rule 23(a), (b)(2), (b)(3), and/or (c)(4) of the FRCP, which includes
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`seeking a declaration that the YBAs and FTT are unlawfully sold unregistered securities, which
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`entitles Plaintiffs and class members to full rescissionary damages. Defendants’ substantial
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`2 In further support of Plaintiffs’ pending Expedited Motion for Leave to Conduct Jurisdictional
`Discovery, and to Amend Their Complaint With Any Facts Arising From Such Discovery, [ECF
`No. 163], filed on April 26, 2023, amongst the anticipated revisions and additions to the anticipated
`Amended Consolidated Complaint that Plaintiffs intend to file at the close of jurisdictional
`discovery will be allegations clarifying that Plaintiffs seek to hold Defendants accountable for their
`promotion of the FTX Platform and their necessary involvement in promoting YBAs and FTT,
`which Plaintiffs allege are also securities that were required to be registered. See, e.g., ECF No. 16
`¶¶ 170–172; see also, e.g., ECF No. 16-1 (Preliminary Expert Report of Paul Sibenik of
`CipherBlade Blockchain Investigation Agency).
`3 https://www.sec.gov/news/press-release/2022-26 (accessed May 8, 2023).
`4
`https://coingeek.com/6-us-regulators-crackdown-on-voyager-digital-over-interest-bearing-
`accounts/ (accessed May 8, 2023).
`5
`https://www.google.com/url?sa=t&rct=j&q=&esrc=s&source=web&cd=&cad=rja&uact=8&ved
`=2ahUKEwjvjNvg27j7AhWfRTABHfwzDe4QFnoECAsQAQ&url=https%3A%2F%2Fwww.nj.
`gov%2Foag%2Fnewsreleases21%2FCelsius-Order-
`9.17.21.pdf&usg=AOvVaw0Zd94fuhFSsOoGKM-vQ3YI (accessed May 8, 2023).
`3
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 4 of 27
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`participation in the offer or sale of these unregistered YBAs and FTT, which were offered or sold
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`from the State of Florida by FTX, renders Defendants jointly and severally liable to Plaintiffs and
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`all Class Members for the full measure of damages resulting from their offer or sale. These specific
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`claims have a strict liability standard with no caveat emptor defense.
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`What’s more, is this action may be the only avenue for any of the victims to recover any
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`of their damages.
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`Plaintiffs’ Counsel have been investigating and litigating these and similar claims against
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`failed exchanges FTX and Voyager for two years. After conducting significant research on the
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`issues with the top cryptocurrency experts in the field, Plaintiffs’ counsel brought the first
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`nationwide class action against failed cryptocurrency exchange, Voyager Digital,6 where they
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`litigated many of these same issues until Voyager declared bankruptcy in July 2022. In August
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`2022, Plaintiffs’ counsel brought the first nationwide class action against some of the largest Brand
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`Ambassadors of Voyager for their respective roles in facilitating Voyager’s offer and sale of
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`unregistered securities.7 That Voyager litigation is ongoing, and after substantial discovery,
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`including reviewing tens of thousands of documents and taking over half a dozen significant
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`depositions, Plaintiffs’ counsel have already amassed enough evidence to seek class certification
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`and summary judgment on many of the dispositive issues in the case.
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`In connection with Voyager’s bankruptcy, Plaintiffs’ counsel closely followed the bidding
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`process that culminated in the purported agreement for FTX to purchase Voyager’s customers’
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`assets, where FTX couched themselves as the saviors of Voyager’s customers. Because that
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`6 Mark Cassidy v. Voyager Digital Ltd., et al., Case No. 21-24441-CIV-ALTONAGA/Torres (the
`“Cassidy Action”)
`7Robertson, et al. v. Mark Cuban, et al., Case No. 22-CV-22538-ALTMAN/Reid (the “Voyager
`Brand Ambassadors Action”)
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`4
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 5 of 27
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`agreement was founded on many false and fraudulent predicates, however, Plaintiffs’ counsel was
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`ready to immediately file this action, the first nationwide class action against FTX, two business
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`days after it was revealed that FTX operated as a fraudulent Ponzi scheme and sought emergency
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`bankruptcy relief for themselves, leaving both Voyager’s and FTX’s customers blindsided with
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`many billions of dollars in losses. Plaintiffs’ counsel have since led the nation’s litigation of these
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`issues, bringing a number of nationwide and global class actions, and state court individual actions,
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`here in South Florida, where FTX maintained its domestic headquarters and base of operations, in
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`order to recover these customers’ losses from any and all responsible parties.
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`All of the actions Plaintiffs’ counsel have brought to date have now been consolidated
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`and/or transferred to this Court, where they can be presided over in an organized and consistent
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`fashion. Given that others around the country are now working to catch up, a rash of additional
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`actions against many of these same defendants have been brought around the country. As a result,
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`in order to continue to organize these actions and to ensure that they are litigated consistently,
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`efficiently, and effectively, Plaintiffs’ counsel filed a petition before the Judicial Panel on
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`Multidistrict Litigation, In re: FTX Cryptocurrency Exchange Collapse Litigation, MDL No. 3076
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`(J.P.M.L. 2023) (the “MDL Petition”), seeking to consolidate all pending and yet-to-be-filed
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`related actions and to transfer them to the Southern District of Florida for pretrial purposes. The
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`MDL Petition was fully briefed and has been set for oral argument on the JPML’s calendar in
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`Philadelphia on May 25, 2023. This action involves many of the very same common legal and
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`factual issues raised by the related actions subject to the MDL Petition.
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`One such common legal issue, the question of whether the sale of every YBA or FTT token
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`is (or is not) the sale of “unregistered securities,” has practically been answered in the affirmative
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`through various regulatory statements, guidance, and actions issued by the Securities and
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 6 of 27
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`Exchange Commission and other regulatory entities.
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`For example, on November 1, 2017, in the “SEC Statement Urging Caution Around
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`Celebrity Backed ICOs,”8 the SEC referred to their Report of Investigation concerning The DAO,9
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`warning that virtual tokens or coins sold in ICOs may be securities, and those who offer and sell
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`securities in the United States must comply with the federal securities laws. Any celebrity or other
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`individual who promotes a virtual token or coin that is a security must disclose the nature, scope,
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`and amount of compensation received in exchange for the promotion. A failure to disclose this
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`information is a violation of the anti-touting provisions of the federal securities laws. Persons
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`making these endorsements may also be liable for potential violations of the anti-fraud
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`provisions of the federal securities laws, for participating in an unregistered offer and sale of
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`securities, and for acting as unregistered brokers. The SEC will continue to focus on these types
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`of promotions to protect investors and to ensure compliance with the securities laws.
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`Now that all Defendants are properly before this Court and the Parties held their Initial
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`Scheduling Conference on April 28, 2023, discovery may now proceed expeditiously and
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`efficiently (unless the Court should decide to stay discovery pending rulings on motions to dismiss
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`or a ruling by the JPML regarding consolidation).10 Plaintiffs will then move for certification of
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`an issue class pursuant to Federal Rules of Civil Procedure 23(a), (b)(3), and (c)(4), with respect
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`to the very specific, narrow and simple issue of whether (or not) the YBAs and/or FTT constitute
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`8https://www.sec.gov/news/public-statement/statement-potentially-unlawful-promotion-icos
`(accessed May 8, 2023) (emphasis added).
`9 https://www.sec.gov/litigation/investreport/34-81207.pdf (accessed May 8, 2023)
`10 Plaintiffs, as explained in their limited response to Defendant Bankman-Fried’s Motion to Stay
`or Alternatively to Dismiss, [ECF No. 176], do not oppose staying this action only as to Defendant
`Bankman-Fried until the conclusion of the trial against him in the criminal action pending in the
`Southern District of New York (Case No. 22-cr-00673). Plaintiffs submit that the stay against
`Defendant Bankman-Fried should not continue through his criminal appeals process. However,
`the Court need not reach that issue now.
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 7 of 27
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`unregistered securities. Plaintiffs are seeking to have this simple issue determined by the Court as
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`soon as practicable. Plaintiffs will thereafter seek a determination on this issue, either through
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`summary judgment or an expedited trial to the extent the Court deems the determination to be an
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`issue of fact.
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`II.
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`Defendants’ Statements
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`A.
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`Sam Bankman-Fried’s Statement
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`Defendant Sam Bankman-Fried is a defendant in a criminal matter set for trial in October,
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`2023 n United States v. Bankman-Fried, 22-cr-00673 (LAK) (S.D.N.Y.). The issues in the present
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`action are inextricably intertwined with the subject of the criminal matter. In order to protect his
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`Constitutional rights pursuant to the Fifth Amendment, Mr. Bankman-Fried respectfully submits
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`that the claims against him should be severed from the present action, and that all aspects of the
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`present action, including discovery, should be stayed as against him pending the outcome of the
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`criminal matter.
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`B.
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`The Non-FTX Defendants’ Statement
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`The Non-FTX Defendants object to Plaintiffs’ Statement, which includes multiple
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`allegations not found in the operative Amended Complaint [ECF 16] and conclusory statements
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`of law unsupported by the allegations made. For example, Plaintiffs’ allegations rest, in large part,
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`on a factual inaccuracy, which Plaintiffs know (or should know) cannot properly be asserted:
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`FTX’s headquarters was never moved to Miami, which means that Plaintiffs’ claims lack the
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`requisite nexus to Florida.
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`Plaintiffs seek to hold the Non-FTX Defendants—seven current or former professional
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`athletes, a professional basketball team, a supermodel, a television personality, and a comedian—
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`jointly and severally liable for billions of dollars in claimed losses resulting from Plaintiffs’ and
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`7
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 8 of 27
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`the putative classes’ alleged deposits of funds into Yield Bearing Accounts (“YBAs”) offered by
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`FTX. Plaintiffs allege the Non-FTX Defendants are somehow responsible for these losses—and
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`indeed are “sellers” of YBAs—because of their involvement in FTX advertisements or
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`sponsorships relating to the FTX exchange. However, Plaintiffs do not allege any Non-FTX
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`Defendant ever even mentioned YBAs—let alone encouraged any Plaintiff to deposit funds into
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`them—nor do they allege that any Non-FTX Defendant played any role in the subsequent alleged
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`losses of funds from those accounts—which Plaintiff’s pleading makes clear was the result of
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`FTX’s misappropriation and mismanagement.
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`Plaintiffs were not injured by any of the Non-FTX Defendants. As their pleading shows,
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`FTX—not any Non-FTX Defendant—allegedly enticed Plaintiffs into opening YBAs. And FTX
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`allegedly operated the scheme that deprived Plaintiffs of the funds deposited into those YBAs.
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`Plaintiffs do not—and cannot—allege a causal connection between the FTX-offered YBAs that
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`allegedly caused their injuries and any statement made by any Non-FTX Defendant—some of
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`whom are not even alleged to have made any statements about FTX as a trading platform, let alone
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`about one of the specific products FTX offered. This total lack of connection between the non-
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`FTX Defendants and the product that allegedly caused Plaintiffs’ injuries is fatal to all of Plaintiffs’
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`claims (including their assertion that the non-FTX Defendants “sold” YBAs), requiring dismissal
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`of this action with prejudice.
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`Plaintiffs’ claims further fail because Plaintiffs fail to plead facts supporting the elements
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`of their counts for violations of the Florida Securities Act, FDUTPA (which is not even applicable
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`in the securities context), civil conspiracy, or a declaratory judgment. Not only that, stretching
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`these causes of action to impose liability for otherwise valid commercial speech would raise
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`significant First Amendment concerns.
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`8
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 9 of 27
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`Finally, as Plaintiffs’ pleading establishes, this suit cannot proceed without FTX, the
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`central actor in Plaintiffs’ story and the entity in possession of the majority of the evidence.
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`However, as Plaintiffs’ pleading also establishes, the FTX entities have sought bankruptcy
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`protection, which creates innumerable impediments to Plaintiffs ever successfully prosecuting any
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`claims they may have—and they have none properly against any of the Non-FTX Defendants.
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`III. Conference Report – Information Required by L.R. 16.1(B)(2)
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`A.
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`Likelihood of Settlement
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`The Parties are amenable at this stage to selecting a mediator and scheduling a time,
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`date, and place to conduct mediation in this matter. The Non-FTX Defendants believe that
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`mediation should take place only after resolution of their pending (or any renewed) motions to
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`dismiss. Defendant Sam Bankman-Fried incorporates his statement in response to item II above.
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`The Parties agree to comply with any requirements under the Local Rules with respect to good
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`faith settlement discussions.
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`B.
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`Likelihood of Appearance in the Action of Additional Parties
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`Plaintiffs believe that, as discovery progresses, additional parties may be added. At this
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`time, the Non-FTX Defendants are unaware of any additional parties who would properly be added
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`to this action. Defendant Sam Bankman-Fried incorporates his statement in response to item II
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`above.
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`C.
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`Proposed Limits on Time
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`See the proposed case schedules at Section V, below.
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`D.
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`Proposals for the Formulation and Simplification of Issues
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`The Parties submit that they will work in good faith to simplify the issues at an appropriate
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`time. Defendant Sam Bankman-Fried incorporates his statement in response to item II above.
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`9
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`E.
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`Necessity or Desirability of Amendments to the Pleadings
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`Plaintiffs’ Position. Many of the Defendants have raised jurisdictional challenges to
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`Plaintiffs’ claims. A number of them even filed sworn declarations to dispute personal jurisdiction
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`and they seek dismissal on that basis. As a result of the factual disputes about personal jurisdiction,
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`on April 26, 2023, Plaintiffs filed their Expedited Motion for Leave to Conduct Jurisdictional
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`Discovery, and to Amend Their Complaint With Any Facts Arising From Such Discovery, [ECF
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`No. 163], seeking leave to conduct such discovery expeditiously (within 45 days of the Court’s
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`order granting the Motion).
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`Plaintiffs respectfully request that the Court grant leave for Plaintiffs to conduct that
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`jurisdictional discovery, and then for a brief 20 day period following the close of that jurisdictional
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`discovery to afford Plaintiffs the opportunity to file an Amended Consolidated Complaint that
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`refines and/or supplements their jurisdictional allegations (including joining or dismissing
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`Defendants, where applicable, as determined from the facts obtained through that jurisdictional
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`discovery), and further allows Plaintiffs their first opportunity to provide significant substantive
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`amendments to the allegations and claims in their consolidated pleading, as Plaintiffs amended
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`their complaint by order of this Court to effect the consolidation of the Podalsky and Garrison
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`actions on December 16, 2023, and have not yet sought leave to amend their complaint because
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`they were completing service of process on Defendants and did not have the benefit of Defendants’
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`Motions to Dismiss, which were first filed April 14, 2023.
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`Effecting this substantive amendment to the Consolidated Class Action Complaint after
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`first conducting brief jurisdictional discovery would be an efficient process, and “Courts routinely
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`allow such amendments to cure pleading deficiencies in service of the general principle that
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`“decisions on the merits are not to be avoided on the basis of ‘mere technicalities.’” Castros v.
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`10
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 11 of 27
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`Signal Fin. Co. LLC, 1:17-CV-21870-KMM, 2018 WL 1137099, at *1 (S.D. Fla. Feb. 4, 2018)
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`(Moore, C.J.) (collecting cases).11
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`In addition, Plaintiffs are endeavoring to obtain Defendants’ agreement to stipulate to the
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`filing of an amended complaint, but if Defendants do not agree, Plaintiffs intend to file a formal
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`motion seeking leave to amend the complaint due to factual investigations that have occurred since
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`the case was filed, pursuant to Rule 15(a)(2) before the May 15, 2023 deadline. Granting leave to
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`amend the complaint would be proper and warranted, even without first conducting personal
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`jurisdiction discovery, on Plaintiffs’ impending motion pursuant to Rule 15(a)(2) of the Federal
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`Rules of Civil Procedure because, in addition to the amendment not being futile where Plaintiffs
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`seek to address purported pleading deficiencies raised in Defendants’ motions to dismiss, the
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`request would be timely and results in no prejudice to the Defendants, as there is no scheduling
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`order or discovery deadline currently in place, the expiration of which would otherwise require
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`Plaintiffs to show “good cause” to amend under Rule 16(b).
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`11 Granting Plaintiffs’ request would comport with the “policy of the federal rules []to permit
`liberal amendment to facilitate determination of claims on the merits and to prevent litigation from
`becoming a technical exercise in the fine points of pleading,” particularly where the proposed
`amendment would not violate any scheduling order in place and there is no “substantial reason” to
`deny the amendment, which “could include ‘undue delay, bad faith or dilatory motive, repeated
`failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing
`party, and futility of the amendment[,]’” none of which would apply since Plaintiffs would be
`providing their first substantive amendment to the complaint after, at a minimum, taking narrow
`discovery to address the jurisdictional arguments raised by some of the Defendants. Castros, 2018
`WL 1137099, at *1 (citations omitted). See also Crossroads Financial, LLC v. Alma-Mater
`Collection, Inc., No. 15-81095-CIV-MARRA, 2019 WL 13196474 (S.D. Fla. Dec. 18, 2019)
`(Marra, J.) (reversing on reconsideration the court’s prior order denying belated motion for leave
`to file second amended counterclaim, filed over 3 years after the deadline to amend in the
`scheduling order, explaining that “it would be in the interest of judicial economy to grant the
`Motion for Leave to File Second Amended Counterclaim, rather than ruling on the Motion to
`Dismiss Amended Counterclaim, and if granted, allow leave to amend (DE 129). This is especially
`appropriate where, as here, [counter-plaintiff] has conceded the Amended Counterclaim has
`multiple ‘technical pleading issues’ that have subsequently been addressed in the proposed Second
`Amended Counterclaim”).
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`11
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 12 of 27
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`For example, amongst the anticipated revisions and additions to the anticipated Amended
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`Consolidated Complaint that Plaintiffs intend to file will be allegations clarifying that Plaintiffs
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`seek to hold Defendants accountable for their promotion of the FTX Platform and their necessary
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`involvement in promoting YBAs and FTT, which Plaintiffs allege are also securities that were
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`required to be registered. See, e.g., ECF No. 16 ¶¶ 170–172; see also, e.g., ECF No. 16-1
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`(Preliminary Expert Report of Paul Sibenik of CipherBlade Blockchain Investigation Agency).
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`Aside from above, Plaintiffs have proposed a final deadline for amendments in their
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`proposed schedule for after the Court’s decision on class certification, in the event Plaintiffs need
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`to convert this action to a mass action.
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`Non-FTX Defendants’ Position. With respect to discovery, the Non-FTX Defendants’
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`position is outlined in their pending motion to stay discovery, ECF 162. With respect to the
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`“jurisdictional discovery” sought by Plaintiffs, the relevant Non-FTX Defendants intend to oppose
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`Plaintiffs’ pending motion, ECF 163, on the grounds that there are no disputed issues of fact that
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`would warrant such discovery; to the contrary, Plaintiffs have not pleaded facts sufficient to
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`establish personal jurisdiction over the Non-Florida Defendants.
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`With respect to amendment, the Non-FTX Defendants state that Plaintiffs have already
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`amended their pleading once as of right in this action, when they more than doubled the size of
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`their complaint from 41 pages (ECF 1) to 97 pages plus added a 17-page expert report. See ECF
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`16. In any case, more than 21 days have passed since the Non-FTX Defendants filed their motions
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`to dismiss. Fed. R. Civ. P. 15 (“A party may amend its pleading once as a matter of course within
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`. . . 21 days after service of a responsive pleading or 21 days after service of a motion under Rule
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`12
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 13 of 27
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`12(b), (e), or (f), whichever is earlier.”).12 Accordingly, any further amendment requires consent
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`of all defendants, including the Non-FTX Defendants, or leave of Court. While Plaintiffs have not
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`provided a proposed amendment for the Non-FTX Defendants to review, the Non-FTX Defendants
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`do not believe that any amendment could cure the deficiencies identified in their pending motions
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`to dismiss. See ECFs 139, 154 & 156-59. Of course, should Plaintiffs provide a proposed
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`amendment for review, the Non-FTX Defendants will consider any proposed amendment in good
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`faith. However, given the incurable deficiencies in Plaintiffs’ existing Amended Complaint, which
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`are not “technical pleading deficiencies” but incurable legal flaws, the Non-FTX Defendants
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`believe that no amendment should be allowed, if at all, until the Court rules on those motions.
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`Defendant Sam Bankman-Fried incorporates his statement in response to item II above.
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`F.
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`Possibility of Obtaining Admissions and Stipulations
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`The Parties will cooperate in good faith to obtain admissions and stipulations in the
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`discovery process that will limit the issues in dispute and reduce the time needed to conduct a trial.
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`Defendant Sam Bankman-Fried incorporates his statement in response to item II above.
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`G.
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`Suggestions for the Avoidance of Unnecessary Proof and of Cumulative
`Evidence
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`The Parties have no suggestions at this time but will cooperate in good faith to eliminate
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`unnecessary proof and cumulative evidence. Defendant Sam Bankman-Fried incorporates his
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`statement in response to item II above.
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`H.
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`The Advisability of Referring of Matters to a Magistrate Judge
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`The Court has referred discovery issues to the Magistrate Judge. See ECF 6.
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`The Parties do not consent to trial by a Magistrate Judge, nor to the disposition of
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`12 Plaintiffs also amended their pleading in action styled Podalsky v. Bankman-Fried, No. 22-cv-
`23983-KMM (S.D. Fla.). See Podalsky ECF 4.
`13
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 14 of 27
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`dispositive pre-trial motions by a Magistrate Judge.
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`Defendant Sam Bankman-Fried incorporates his statement in response to item II
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`above.
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`I.
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`Preliminary Estimate of Time Required for Trial
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`Plaintiffs estimate that a trial in this matter would require 5–7 days. Plaintiffs demand a
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`jury trial.
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`The Non-FTX Defendants estimate a trial in this matter would likely require 10 to 14
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`days, especially given the number of defendants named in the Amended Complaint [ECF 16].
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`Defendant Sam Bankman-Fried incorporates his statement in response to item II above.
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`J.
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`Pretrial Conference and Trial Dates
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`See Section V, below.
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`K.
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`Any Discovery Issues
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`The Parties will cooperate in good faith to develop protocols to facilitate electronic
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`discovery and govern privilege issues without the involvement of the Court. This may include
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`the submission of an agreed confidentiality order.
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`Defendant Sam Bankman-Fried incorporates his statement in response to item II
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`above.
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`Non-FTX Defendants’ Position. The Non-FTX Defendants anticipate that discovery
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`may be substantially delayed in material ways as a result of the forthcoming criminal trial of
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`Defendant Sam Bankman-Fried, which is presently set for October 2, 2023. The United States
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`has taken the position that several cases pending against Mr. Bankman-Fried should be stayed
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`due to the potential implications of civil discovery involving not only Mr. Bankman-Fried, but
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`also FTX and any cooperating witnesses, including Defendants Ellison, Wang, Singh, and
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`14
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 15 of 27
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`Friedberg, for Mr. Bankman-Fried’s criminal trial. See Order at 1, SEC v. Bankman-Fried, No.
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`22-cv-10501 (S.D.N.Y. Feb. 13, 2023), ECF No. 16 (granting United States’ motion to stay
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`proceedings “until the conclusion of the parallel criminal case”); Order at 1, CFTC v. Bankman-
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`Fried, No. 22-cv-10503 (S.D.N.Y. Feb. 13, 2023), ECF No. 38. In addition, discovery from
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`FTX itself is likely to pose difficulties due to FTX’s pending bankruptcy, which is in its early
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`stages. As described further below, the Non-FTX Defendants anticipate that if this case
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`proceeds beyond the pleading stage, they will need substantial discovery from the FTX
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`Defendants and from FTX. Accordingly, the Non-FTX Defendants propose that the standard
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`tracks be modified, and extended slightly, account for the delays.
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`IV.
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`Additional Information Required by L.R. 16(B)(3)
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`A.
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`Assignment of the Case to a Particular Track
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`Plaintiffs’ position is that this case merits a standard case management track at this stage,
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`as defined by Local Rule 16.1, and as set forth in their schedule proposed in section V, below.
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`The claims in this lawsuit center on whether FTX’s applicable offerings constitute securities
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`that were required to be registered under applicable securities laws, a determination that lends
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`itself to issue class certification pursuant to Federal Rule of Civil Procedure 23(c)(4). Thereafter,
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`this matter can proceed to an expedited trial on those issues which would efficiently and
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`expediently determine whether Defendants may be found liable under these claims.
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`Defendant Sam Bankman-Fried incorporates his statement in response to item II
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`above.
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`The Non-FTX Defendants believe that this case could only properly be assigned to a
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`Complex Track, as defined in Local Rule 16.1(a)(2)(C), which would have to be extended in
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`view of the various ongoing criminal and bankruptcy proceedings arising from the FTX collapse
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`15
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`Case 1:22-cv-23753-KMM Document 192 Entered on FLSD Docket 05/08/2023 Page 16 of 27
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`and Plaintiffs’ voluntary agreement to stay proceedings against Defendant Sam Bankman-Fried
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`through his pending criminal proceedings, which are anticipated to go to trial in October 2023
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`at the earliest.
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`B.
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`Detailed Discovery Schedule
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`Plaintiffs’ and the Non-FTX Defendants’ scheduling proposals for discovery are set forth
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`below, at Section V. Defendant Sam Bankman-Fried incor