An Australian-Israeli class action lawsuit has amassed $150 million in damages claims in a class-action lawsuit against Facebook, Google, and Twitter for banning crypto ads – and believes overall damages could reach hundreds of billions of dollars.
In January last year, Facebook banned any advertisements relating to cryptocurrency, shortly followed by Google and Twitter.
Lawyer Andrew Hamilton, who is organizing a class action against the tech giants, says the anti-competitive actions cost the blockchain and cryptocurrency industry up to $500 billion in lost revenue and market capitalization.
“The week after the Facebook ban, the cryptocurrency market cap dropped by 53%,” he told Micky from Tel Aviv. “That’s $300 billion dollars. And it’s not just once. we know markets are volatile, but we can show four or five correlations. Six weeks later Google announced a ban and market dropped another 30% or $100 billion in a week. Twitter announced a ban and the market dropped another 23%.”
Hamilton estimates crypto investors lost as much as $300 billion due to the ban (though a proportion of those losses will be unrealized if people didn’t sell). He said the volume on exchanges also dropped 70% – 90% and “thousands” of ICOs failed to get traction due to their inability to promote their token sales.
All of these people are eligible to join the class action on a ‘no win, no fee’ basis.
Hamilton, who is a dual Australian-Israel citizen, said he had run cases in Australia’s high court and worked for large companies like Telstra. He said Australia was an ideal location for legal action in this matter due to its laws relating to anti-competitive behavior.
“In Australia the way the law is drafted, it’s not at all difficult to prove,” he said.
“If you do X plus Y plus Z it’s deemed to be anti-competitive. You just have to prove they put in a provision in a contract that restricted the supply of services. It’s called an exclusionary provision and it’s outright illegal.”
Hamilton has formed a Litigation Funding Company called JPB Liberty. The company’s website claims the “ban was an anti-trust violation which breached Australia’s competition and consumer protection law” and that any company “doing business in Australia which engage in anti-trust violations can be sued for worldwide damages in Australian Courts.”
It says that anyone holding crypto at the time can join the action.
Facebook’s recent announcement it would launch its own cryptocurrency called Libra has added fuel to the fire. Every aspect of Libra would have been banned under its former prohibitions against cryptocurrency advertising – and Hamilton draws a link between the reversion of the ban and the Libra announcement.
JBL Liberty’s website suggests it may also take actions against banks that restricted customers from cryptocurrency-related actions and regulators clamping down on cryptocurrency.
For its part, JPB Liberty will receive roughly a quarter of any damages awarded.
Hamilton said the class action has already signed up “hundreds and the value (of claims) is close to $100 million. We’ve signed up so many in the last four weeks the value might be closer to $150 million.”
He explained that only those who join a class action BEFORE it settled out of court would be eligible for damages. If the case is decided in court, anyone holding crypto at the time, even if not involved in the class action, would be eligible for damages.
Hamilton said the action had already passed two of three thresholds to proceed. The first is having a high enough value of claims to justify the amount spent on the legal case. The second is legal advice confirming the case is justified.
The third is raising sufficient funds to launch the case. This has not yet been met but Hamilton said he was negotiating with a range of litigation funding companies – some willing to put in “six to seven figures” while other options would reduce the budget closer to “half a million”.
“One way or another we will have funding within six months and we will almost certainly be filing in court within six months,” he said.
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