Settlement Approved in Class Action Against Binance Promoters
On Wednesday, September 4, 2024, the US District Court for the Southern District of Florida approved the first tranche of settlements in the class-action case of Sizemore et al. v. Zhao et al. The case involves allegations against Binance Promoters Ben Armstrong and Jimmy Butler, the settling defendants. The court’s order provisionally certifies the proposed settlement class and establishes a timeline for the upcoming proceedings.
The plaintiffs in this case, led by Michael Sizemore, Mikey Vongdara, and Gordon Lewis, reached a settlement agreement that collectively provides $340,000 in monetary relief to members of the Binance class. The funds will be held in a settlement fund pending further instructions on how to distribute them among eligible class members. The approval follows a motion submitted by the plaintiffs for preliminary approval of the settlements, which the court has granted.
The court noted that the settlement agreements were crafted after extensive negotiations and multiple mediation sessions among the parties involved. The agreements are intended to resolve claims related to the sale and promotion of certain cryptocurrency tokens and programs, which the plaintiffs allege constituted unregistered securities.
In the order, the court emphasized the importance of a proper notice plan to inform class members about the settlement. The plaintiffs have engaged JND Legal Administration, LLC to develop a notice strategy that aligns with previously approved plans in similar cases. This strategy aims to ensure that all affected parties are adequately informed about their rights and the terms of the settlement.
The court found that it possesses jurisdiction over the subject matter of the case and that the proposed class meets the requirements outlined in Rule 23 of the Federal Rules of Civil Procedure. The court preliminarily certified a class consisting of all individuals and entities who purchased, held, or sold specific cryptocurrency tokens on Binance platforms. Notably excluded from the class are the settling defendants and their affiliates, as well as any governmental entities and judicial officers involved in the case.
The court’s order outlines several key findings supporting the preliminary certification of the class. These include factors such as numerosity, commonality, typicality, and adequacy, which collectively suggest that the class is suitable for settlement purposes. The plaintiffs estimate that the number of class members could be in the millions, given the significant user base of Binance.
Additionally, the court highlighted that the settlements are the result of informed negotiations and are not indicative of collusion between the parties. The appointed class representatives and their legal counsel have been deemed capable of adequately representing the interests of the class members throughout the proceedings.
The approved notice plan will involve direct communication with class members through email and digital notices, as well as publication in relevant cryptocurrency industry outlets. This multi-faceted approach aims to ensure that affected individuals are well-informed about the settlement process and their rights within it.
The court also addressed the timeline for further proceedings, stating that formal notice to the class will be deferred until the resolution of claims against non-settling defendants. This approach is intended to maximize efficiency and minimize costs associated with notifying class members.
As part of the settlement process, the court will hold a fairness hearing where class members can express their opinions about the settlement. At this hearing, class counsel will present evidence supporting the fairness and reasonableness of the settlement terms. The court will ultimately determine whether to grant final approval of the settlements based on the feedback received during this hearing.
In summary, the court’s approval of the first tranche of settlements marks a significant development in the ongoing litigation surrounding the alleged fraudulent activities of Binance promoters. With the provisional certification of the settlement class and the establishment of a detailed notice plan, the case is moving forward toward resolution, benefiting class members who have been impacted by the actions of the settling defendants.
Please contact BlockTribune for access to a copy of this filing.
