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Carlos Watson on Trial & A Ryan Kavanaugh Deal

carlos watson
Carlos Watson is not only questioning the existence of “victims” who prosecutors assert were duped by Ozy, he is also seeking to broaden the scope of the trial by putting the entire media industry under the spotlight. Photo: Kimberly White/Getty Images
Eriq Gardner
May 6, 2024

Back in 2021, Ozy Media’s empire of spammy newsletters and cringey videos started to crumble under scrutiny. Ben Smith, then the media columnist for The New York Times, famously detailed how the company’s chief operating officer impersonated a YouTube executive during an investment pitch call with Goldman Sachs. The incident was bizarre, but did it qualify as aggravated identity theft? And was the broader effort by Ozy to secure tens of millions of dollars by embellishing its prospects in the content marketplace, including by inflating revenue and investor interest, tantamount to conspiracy to commit securities and wire fraud? These questions will land in the lap of a Brooklyn jury when the criminal trial against Ozy founder Carlos Watson kicks off on May 20.

Since Watson was indicted in February 2023, his legal team has protested that he’s being unfairly singled out for what they claim is routine “puffing and bluffing.” In a motion to dismiss, submitted last August, Watson’s lawyer Ronald Sullivan argued that such puffery, no matter how morally questionable, has become woven into the fabric of the tech economy. Sullivan cited Apple, Google, Tesla, and Airbnb as engaging in similar tactics and asserted that criminalizing Watson’s fundraising efforts would disrupt the entire landscape. “To argue otherwise is to ignore the realities of the freewheeling venture capital market that has produced much innovation,” he wrote, adding that sophisticated counterparties were not likely to be led astray by clumsy impersonation attempts or overly optimistic revenue projections.