According to the Complaint, is is alleged that Defendants are management and the top promoters of TelexFree — which operated as a pyramid scheme whereby Defendants sold “memberships” that, when purchased, purportedly permitted purchasers to earn in excess of a 200% return. Class members were not required to sell any of TelexFree’s product, or to perform any actual work, in order to receive this 200% return. Rather, TelexFree and Defendants claimed that Class members would earn their return from the efforts of others, including but not limited to TelexFree. In reality, Class members would receive nothing, and TelexFree and Defendants would profit, to the tune of at least $300 million and potentially as much as $1 billion.

On March 19, 2015, the Court appointed Lead Plaintiffs and approved Lead Counsel. A consolidated Complaint was filed on March 31. The consolidated Complaint dropped the federal securities claims.