Earlier this month, Florida-based crypto platform Celsius announced it was freezing withdrawals indefinitely, leaving its users with deposits totaling in the billions with little recourse.
Enter the legal services startup DoNotPay, which has been helping over a thousand former Celsius users sue the company in small claims court to get their funds back.
The San Francisco company operates an app it describes as a "robot lawyer" that typically helps users beat parking tickets in court or fight cable companies overcharging on bills, however sometimes it inserts itself in high-profile corporate scandals to help everyday people get compensation. In the past, DoNotPay has helped its users win about $3 million in total from claims against Equifax after the credit reporting agency has a massive data breach in 2017.
"Celsius still has some of the money, although they don't have all of it," said DoNotPay CEO Joshua Browder. "So the question is, how do you get to the front of the line, and that's what small claims does for you."
Judgements in small claims court are typically capped at about $10,000-$25,000 ($10,000 in S.F.), but it is much easier to fight a large corporation with expensive lawyers in small claims court, as the ruling is entirely up to a judge and the trials are expedient. Those that win a judgement can also go straight to the bank that is holding the company's money that they sued to get paid in a more timely manner, instead of waiting around for Celsius to potentially enter bankruptcy proceedings.
According to Browder, the whole thing is a one-month process. DoNotPay can help a person generate the filing necessary to send a demand letter to Celsius requesting them to return their money. If the company does not respond within 10 days under California law, one could go to small claims court and file a lawsuit. The judge will set a hearing and if the company does not show up, the plaintiff will receive a default judgement in their favor.
"Maybe San Francisco's a bad example, because it's a major tech hub, but I don't think Celsius is going to be showing up in these rural towns to defend all these cases — I think they have bigger things to worry about," Browder said.
Browder was able to spur on these lawsuits through his app, simply by posting a viral thread on Twitter, detailing specifically how Celsius users could get their money back through small claims court.
DoNotPay was founded in 2015 and has 15 employees with an office on Townsend Street.
