Judge allows CryptoZoo defamation suit to proceed

Logan Paul’s defamation lawsuit against YouTuber Stephen Findeisen, known as Coffeezilla, will move forward after a Texas magistrate judge ruled that the claims presented by Paul were “reasonably capable of defamatory meaning.”  

Filed in June 2023, the lawsuit accuses Coffeezilla of making damaging statements about Paul’s failed CryptoZoo project through social media posts and YouTube videos.  

Magistrate Judge Henry Bemporad recommended denying Coffeezilla’s request to dismiss the case, stating that his remarks were presented as factual assertions rather than opinions.  

“The court should reject defendants’ contention that context renders Findeisen’s statements nondefamatory,” Bemporad wrote in his report.  

The judge also noted that disclaimers in Coffeezilla’s videos were not prominently displayed and did not alter the factual nature of his claims.  

CryptoZoo, launched in 2021, was marketed as a blockchain-based game where players could buy NFT eggs that hatch into hybrid animals, earning tokens based on their rarity.  

However, the project faced significant setbacks and accusations of mismanagement.  

Coffeezilla released videos labeling CryptoZoo a “scam” and called Paul a “serial scammer,” allegations Paul denies.  

He claims he was misled by advisers involved in the project and had intended to create a legitimate game.  

Paul has pledged $2.3 million for refunds to affected CryptoZoo investors but conditioned the reimbursement on claimants agreeing not to sue.  

Meanwhile, he has also faced a class-action lawsuit from CryptoZoo buyers and filed counterclaims against former business partners he alleges contributed to the project’s failure.  

Both parties have 14 days to object to Bemporad’s report before it is reviewed by federal Judge Orlando Garcia.  

Neither Paul nor Findeisen provided comments following the ruling.