Was Fyre Festival a Ponzi scheme? Lawsuit says organizers knew it was fraud

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Fyre Festival wasn’t just a disaster, it was a total fraud that organizers knew for weeks would end in a “post apocalyptic nightmare” — but went ahead in hopes of a big payday, according to the latest legal filing against the creators of the event.

An amended lawsuit, filed Monday in federal court in California and acquired by Mashable (below), goes so far as to liken Fyre to a “Ponzi scheme.” 

Prepared by powerhouse celebrity law firm Geragos and Geragos, the lawsuit demands a jury trial, alleges damages ranging from $1,200 to $100,000 per attendee and seeks class-action status, suggesting that as many as a thousand people will join up before all is said and done.

Mark Geragos — who’s represented clients like Michael Jackson, Chris Brown and Kesha — originally filed last week on behalf of Daniel Jung, who reportedly paid $2,000 for his ticket and travel to the Bahamas event at the end of last month.

The amended complaint says that further investigation discovered that the defendants, including Ja Rule, Billy McFarland and Jeffrey Atkins, put the whole thing together “merely [as] a front for a massive financial fraud akin to a Ponzi scheme in which the founders … in Fyre Media Inc. misappropriated funds from attendees.”

The suit says other defendants, including a prominent socialite, a social media personality and a venture capitalist, will be identified later as “seed investors.”

Though this is the first lawsuit to liken Fyre to a Ponzi scheme, it’s hardly the only to accuse its organizers of negligence. 

Fyre has become the target of several legal actions, including from National Event Services, Inc. (NES), a Pennsylvania-based company hired to provide on-site medical care; New Jersey resident Andrew Petrozziello, who paid $1,100 for a ticket but was stranded in Miami when the event was “postponed”; and a $5 million class action lawsuit filed last week in Florida.

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