A federal judge has denied the request of Sam Bankman-Fried, the founder and CEO of FTX, to cross-examine Gary Wang, the former chief technology officer of FTX, in a lawsuit filed by Caroline Ellison, a former employee of the exchange.
Ellison, who worked as a marketing manager at FTX from June 2020 to January 2021, alleges that she was sexually harassed and discriminated against by Bankman-Fried and Wang and that she was fired after she complained about their behavior. She also claims that FTX engaged in illegal and unethical practices, such as manipulating the prices of its tokenized stocks and violating U.S. securities laws.
Just stepped out for lunch break from #FTX trial. Caroline Ellison took the stand for just a few minutes before lunch.
Just long enough to state that she had been charged with various fraud crimes, and that she did them with Sam.
— David Z. Morris (@davidzmorris) October 10, 2023
Ellison is seeking $150 million in damages from FTX, Bankman-Fried, Wang, and other defendants. She has also published a tell-all book titled “The Crypto Queen: How I Exposed the Dark Side of FTX and Sam Bankman-Fried”, which details her allegations and experiences at FTX.
Bankman-Fried and Wang have denied Ellison’s allegations and have filed motions to dismiss the lawsuit. Bankman-Fried also requested to cross-examine Wang, who left the company in February 2021 and is now working at Coinbase, a rival crypto exchange.
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Bankman-Fried argued that Wang’s testimony would be crucial to his defense, as Wang was directly involved in the development and operation of the crypto trading platform. However, Judge Lewis Kaplan rejected Bankman-Fried’s request, stating that it was premature and unnecessary at this stage of the litigation.
Judge Kaplan said that Bankman-Fried had not shown that Wang’s testimony would be relevant or material to the motion to dismiss and that cross-examination would only prolong the proceedings and increase the costs for both parties.
Judge Kaplan also noted that Wang had submitted a declaration in support of Ellison’s lawsuit, in which he confirmed some of her allegations and contradicted some of Bankman-Fried’s statements. Judge Kaplan said that Wang’s declaration was sufficient for the court to evaluate the motion to dismiss and that cross-examination would not add any value or clarity.
The judge ordered Bankman-Fried to file his reply to Ellison’s opposition by October 18, 2023 and scheduled a hearing on the motion to dismiss for November 1, 2023. The judge also warned both parties to refrain from engaging in any further discovery or depositions until the motion to dismiss is resolved.
