Securities Class Action Report Shows Rise in Dollar Value, Number of AI-Related Cases

AI, Big-Dollar Suits Dominate Data on New Investor Class Actions

Allegedly unrealized artificial intelligence promises and cryptocurrency issues helped drive a surge in high dollar securities suits in the first half of 2025, according to a litigation report published Wednesday.

The first half of the year has seen a steady rise of lawsuits related to the emerging technologies as companies struggle with disclosures, compliance, and volatile markets, according to lawyers who talked to Bloomberg Law about the report published by Cornerstone Research and the Stanford Law School Securities Class Action Clearinghouse.

“I kind of view the securities filings, in a way, as almost like a distant mirror on current events,” said Jonathan Youngwood, global co-chair of Simpson Thacher & Bartlett LLP’s litigation department. “They’re like a delayed reflection on what was happening a year ago or two years ago, what was the new ‘in thing’ or the new problem.”

White House Urges ‘Pro-Innovation Mindset’ to Crypto In New Report

The White House released a report on Wednesday calling for U.S. agencies to promote cryptocurrency trading and craft new regulations for the industry, the latest step in President Trump’s wide-ranging embrace of the crypto world.

The report was largely an elaboration of policy proposals the White House had already backed, crystallizing the Trump administration’s permissive approach to crypto regulation. In 168 pages, it called on banking regulators, financial authorities, tax officials and U.S. lawmakers to implement policies that would advance the industry’s agenda.

Comparing crypto to world-changing inventions like the railroad and the internet, the report said the United States should “adopt a pro-innovation mind-set toward digital assets” and ensure that crypto becomes a “hallmark of the new American Golden Age.”

Bill Barring Stock Trading for Congress Advances With Trump Carve-Out

A key Senate committee on Wednesday approved legislation that would bar members of Congress, the president and the vice president from trading stocks, after its Republican sponsor changed the bill to ensure that a divestment requirement included in the measure would not apply to President Trump.

The legislation, sponsored by Senator Josh Hawley of Missouri, attracted an unusual coalition of supporters, winning approval from the Senate Homeland Security and Governmental Affairs Committee with every other Republican on the panel in opposition and Democrats unanimously in support.

Startup Builder.ai Goes From $1.5 Billion Unicorn to Bankruptcy

When the world’s elite gathered in Davos, Switzerland, in January 2024, Sachin Dev Duggal reveled in his role as the founder of a bona fide artificial intelligence unicorn. His startup, Builder.ai, sponsored glitzy events with celebrities and magazine editors. The BBC featured him on air as an expert in the buzzy technology. Builder.ai’s “Chief Wizard,” as Duggal called himself, told another interviewer at Davos that generative AI is “the cape that you make people superheroes with.”

Whatever magic Duggal once conjured is now gone. A year after his Davos appearance, he was pushed out as chief executive as investors began to suspect him of inflating revenue and mismanaging funds. The startup’s board later restated sales and a major lender seized virtually all of its cash, forcing the company into bankruptcy in June.

Builder.ai’s audit committee uncovered a web of dubious transactions. The London-based company booked $142 million in sales from resellers that never paid any money and claimed an additional $107 million from customers who made deposits of as little as $1. Such methods, the audit committee found, were used to overstate revenue by 300% as Duggal secured an emergency loan last year. A law firm hired by the company also determined that Duggal “orchestrated a scheme” with a high-profile Indian startup to exaggerate sales through what’s known as “round tripping,” according to documents viewed by Bloomberg News.

Chase Customers to Link Bank Accounts to Coinbase Wallets

JPMorgan Chase & Co. and Coinbase Global Inc. signed an agreement to directly link customers’ bank accounts to their cryptocurrency wallets, as banks and fintechs clash over who has access to consumer data and at what cost. […]

In addition to linking bank accounts, customers will be able to fund Coinbase accounts with their Chase credit cards for the first time — an option expected to be active this fall, the firms said in the statement. They will also be able to redeem Chase rewards points to fund their crypto wallets.