Bankrupt FTX Sues Neil Patel for $55M

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Neil Patel has been accused of misdeeds multiple times in the digital marketing world over the years.

Even by those standards, the most recent one is a doozy.

But you may have a hard time finding it.

If you search for “Neil Patel sued”, there’s a good chance you’ll see a torrent of posts by Neil talking about a time he got sued in 2011. These posts cover every platform, including LinkedIn, Instagram, YouTube, TikTok, and more.

When I first saw these videos, I thought, “Why is Neil flooding social media with a story from 14 years ago?”

A clever bit of reputation management, really.

By posting about this old case, he made other, more recent search results harder to find.

Specifically, you may have difficulty finding information about FTX’s current $55 million lawsuit against Neil Patel.

FTX, if you recall, was one of the biggest cryptocurrency exchanges on the planet. It went bankrupt in 2022, and its CEO, Sam Bankman-Fried, was famously convicted of stealing $8 billion from customers.

It turns out that one of the things FTX spent money on was over $30 million for marketing services to companies run by Neil Patel.

Now, the FTX Debtors—the ones that went bankrupt after the FTX crypto collapse—are suing Neil Patel and his associated companies for $55 million, alleging fraud.

Folks, this is kinda a big deal.

FTX Debtors’ Case Against Neil Patel

You can read the original filing here. Some of the bigger claims made by FTX include:

A total of $30.8 million was paid to Patel and his companies between 2021 and 2022.
“FTX Insiders, including Bankman-Fried engaged Defendant Neil Patel and his companies, Defendants Big Deal and NP Digital, for the ostensible purpose of driving performance marketing for the FTX Group.”
Neil Patel Digital charged FTX a $1 million set-up fee and a $6 million yearly fee for SEO and ad work. FTX says that the prices were “well above market.”
“FTX Group employees described Defendants’ work as ‘sooo sloppy’ and ‘terrible performance,’ and many of Defendants’ promised services were never provided at all.”
“The tens of millions of dollars paid to Patel and his affiliates bore no reasonable relationship to the value of the services provided.”
The biggest single payment, amounting to $14.8 million, was for “attempting to find another consultant.” FTX claims that no consultant was ever found.
FTX paid Neil Patel Digital $2.7 million to promote the Serum crypto project. FTX investigators say they cannot find any deliverables for that project.
Three weeks before FTX collapsed, Neil Patel Digital billed another $6 million using a private Slack chat. Importantly, this occurred during a period when FTX was already failing financially. Despite this, FTX made the payment.

It’s important to note that these are not criminal charges.

For now, this is a purely civil procedure, and Neil Patel Digital has refuted the basis of these claims in court.

Neil Patel Controversies Over The Years

Those in the digital marketing world know that Neil is no stranger to controversy. A short list of the top hits:

In 2012, KissMetrics, a company co-founded by Neil Patel, settled a class-action lawsuit that accused it of violating wiretapping laws.
Several bloggers have accused Neil of stealing content. So much so that it has become something of a joke in its own right.
Better Business Bureau complaints from unhappy clients allege being “forced to stay” in long-term agreements with threats of lawsuits and collection fees.
Marketers accused him of sexism/objectification after a series of ads featuring Playboy models and women in lingerie with taglines like “Neil taught me how to make money without taking my clothes off.”
Several years ago, Neil posted an investment pitch video involving the video game industry that many Redditors called a “scam.”
Neil is often accused by other marketers of unethical and even illegal marketing tactics.

In a recent Ahrefs Podcast, Neil addressed some of the controversy he often encounters:

“It’s about doing the right thing as a human right. And you just really got to look at people for what they are as human beings, and you can’t screw them over. You’re going to make mistakes. You’re going to piss people off. You apologize, but you’re not going to please everyone. Like, the amount of bad press I’ve seen on myself on the internet is ridiculous.”

My Connection With Neil Patel

I first met Neil Patel in 2013, when we both spoke at a marketing conference in the Czech Republic. I found him to be friendly, affable, and intelligent.

He also came off as one of the most efficient people I’ve ever met.