When talking about digital assets, how much is saying too much? How much is saying too little? Did what you say ultimately matter? Recent court decisions arising from the purchase and sale of digital assets have grappled with liability claims posing such questions about information that had been stated or omitted.

Not Saying Enough

In re Ethereummax Investor Litigation, 2023 WL 6787458 (C.D. Calif. Oct. 3, 2023), was the most recent ruling in a long-running litigation against celebrity endorsers of and company executives behind EMAX tokens, a “blockchain-based digit asset” that “function like other digital cryptocurrencies” and “were sold on decentralized exchanges.” Such exchanges “allow anyone to list and sell tokens” by using “liquidity pools and smart contracts to allow investors to exchange one asset for another without a direct counterparty,” for which users must pay a so-called “gas fee” to process the transaction on the Ethereum blockchain.