AI16Z and ELIZAOS creators face class-action lawsuit over false advertising and unjust enrichment allegations

TechFlow News, April 21 — Crypto law firm Burwick Law has filed a federal class-action lawsuit in the United States District Court for the Southern District of New York (SDNY) against the creators of AI16Z and ELIZAOS, including Walters, alleging suspected violations of consumer protection laws, false advertising, and unjust enrichment. The legal filings show that the defendants are accused of leveraging the brand reputation of Andreessen Horowitz (a16z) to package the project, and issuing the AI16Z tokens on Solana on October 24, 2024, before later renaming them to ELIZAOS. The complaint states that the project claimed to have AI agents capable of autonomous investing, but in reality, they were manually operated, and the project generated no revenue during the period of the lawsuit.

On January 2, 2025, the token price reached an all-time high of approximately $2.47, with a market capitalization of more than $2.6 billion, and then collapsed due to large holders selling off. On-chain data shows that the traders with the highest profits achieved profits of about $39 million.