A Coinbase shareholder has filed a derivative lawsuit against several of the crypto exchange’s senior executives and board members, claiming they failed to properly oversee compliance and disclosures, which allegedly exposed the company to legal and regulatory risks.
The complaint was filed Tuesday in the US District Court for the District of New Jersey by shareholder Kevin Meehan on behalf of Coinbase Global. It names CEO Brian Armstrong, co-founder Fred Ehrsam, and several current and former directors and senior leaders, including chief legal officer Paul Grewal and chief financial officer Alesia Haas.
According to the filing, the defendants allegedly issued false or misleading statements between April 2021 — when Coinbase went public through a direct listing — and June 2023. The plaintiff argues that these oversight failures left the company vulnerable to regulatory enforcement actions.
In early 2023, Coinbase agreed to a $100 million settlement with the New York State Department of Financial Services over shortcomings in its anti-money laundering (AML) compliance program. Separately, the company faced a $5 million penalty from New Jersey’s Bureau of Securities related to listing unregistered securities.
Shareholder lawsuit seeks damages and profit clawbacks
The lawsuit is seeking damages on behalf of Coinbase, along with corporate governance reforms and the clawback of compensation and profits allegedly earned by insiders while the company’s compliance issues were ongoing.
Because the case is structured as a shareholder derivative action, any financial recovery would go to Coinbase rather than directly to its shareholders.
The complaint also calls for a jury trial and accuses the defendants of unjust enrichment, abuse of control and breaches of fiduciary duty tied to what it describes as systemic compliance failures.
Coinbase faces additional legal challenges
Coinbase is also dealing with several other lawsuits from shareholders and investors.
In January, a Delaware judge allowed a shareholder lawsuit accusing several Coinbase directors of insider trading to proceed, despite an internal investigation that cleared the executives. The case alleges that insiders — including CEO Brian Armstrong and board member Marc Andreessen — used nonpublic information to avoid more than $1 billion in potential losses by selling shares around the time of Coinbase’s 2021 direct listing.
Separately, in May 2025, Coinbase and two of its executives were named in a proposed class-action lawsuit filed by an investor. The complaint claims the company’s stock price dropped after it revealed a user data breach and allegedly failed to disclose a violation of an agreement with the United Kingdom’s Financial Conduct Authority. According to the lawsuit, these disclosures triggered a sharp decline in Coinbase’s share price and resulted in investor losses.
