The creators of AI16Z and ELIZAOS are facing a class-action lawsuit alleging false advertising and unjust enrichment.

According to Mars Finance, crypto law firm Burwick Law has filed a federal class-action lawsuit in the Southern District of New York (SDNY) against Walters, the creator of AI16Z and ELIZAOS, and other defendants, accusing them of violating consumer protection laws, false advertising, and unjust enrichment. Legal documents show that the defendants are accused of using the Andreessen Horowitz (a16z) brand reputation to package the project and issuing the AI16Z token on Solana on October 24, 2024, later renamed ELIZAOS. The complaint alleges that the project claimed to have an AI agent capable of autonomous investment, but in reality, it was operated manually and generated no revenue during the litigation period. On January 2, 2025, the token price reached an all-time high of approximately $2.47, with a market capitalization exceeding $2.6 billion, before collapsing due to large-scale selling. On-chain data shows that the most profitable traders realized approximately $39 million in profits.