Influencer Logan Paul should be allowed to continue a lawsuit accusing the YouTuber known as “Coffeezilla” of making defamatory remarks about Paul’s failed CryptoZoo project, a Texas magistrate judge said.

In a March 26 report filed in a San Antonio federal court, Magistrate Judge Henry Bemporad recommended that federal Judge Orlando Garcia, overseeing the case, deny Stephen Findeisen’s bid to toss Paul’s lawsuit, as Findeisen presented his claims more akin to facts than “mere opinion.”

“At the pleading stage, Plaintiff [Paul] has sufficiently alleged that the statements at issue in this case are reasonably capable of defamatory meaning and are not unactionable opinions,” Bemporad wrote.

“The Court should reject Defendants’ contention that context renders Findeisen’s statements nondefamatory,” he added.

Paul sued Findeisen in June, claiming one of Findeisen’s X posts and two YouTube videos about his CryptoZoo non-fungible token (NFT) project were malicious and caused reputational damage.

CryptoZoo was pinned as a blockchain game where players buy NFT “eggs” that would hatch into animals that could be bred to create unique animals to earn tokens depending on their rarity. The game is yet to materialize.

An example of a CryptoZoo NFT animal that combines a shark and an elephant. Source: CryptoZoo

Paul claimed Findeisen called him “a serial scammer” and that CryptoZoo was a “scam” and a “massive con,” which Paul denied. 

Findeisen asked the court for an early judgment last month, claiming his statements were made to be taken as opinions and his videos had disclaimers in the description section saying as such.

But Bemporad found that “Findeisen’s three statements meet the legal definition of defamatory” and noted that the disclaimers “are not particularly prominent” and are “visible only when the section is expanded.”

“Even if the disclaimers were more prominently on display, however, they would not materially change the factual nature of Findeisen’s assertions,” he added.

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Paul or Findeisen can object to Bemporad’s report within 14 days. Lawyers for Paul and Findeisen did not immediately respond to requests for comment outside of business hours.

Findeisen also released three videos in 2022 on CryptoZoo, which Paul did not bring defamation accusations against but previously threatened to sue over. 

He later backtracked, apologized, and in January 2023, promised to come up with a plan for CryptoZoo — which came a year later with Paul earmarking $2.3 million for refunds so long as claimants agreed not to sue over the project.

Meanwhile, a group of CryptoZoo buyers sued Paul and others they accused of being involved in the business in a class-action lawsuit, which Paul has asked to have tossed. He has also filed a counter-suit against two business partners he claimed were to blame for CryptoZoo’s failure.

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