PSA hit with class action lawsuit accusing trading card grading giant of widespread fraud

A proposed class action lawsuit has been filed against Professional Sports Authenticator (PSA) and parent company Collectors Holdings, accusing the trading card grading giant of misleading customers about how its grading system works.

Filed on July 28 in the US District Court for the District of Maryland, the 188 page complaint alleges PSA falsely markets its grading process as objective, consistent and independent, while claiming the company instead relies on subjective evaluations and business practices that financially benefit from repeated submissions.

The lawsuit was brought by plaintiff Nicholas Funk, who is seeking to represent a nationwide class of customers who paid PSA grading fees. The allegations have not been proven in court, and PSA has not yet responded to the complaint.

Lawsuit claims PSA’s grading process is inconsistent and financially conflicted

According to the complaint, PSA built its reputation by promising collectors that its grades are based on standardized expert evaluations. The lawsuit argues those claims are misleading, alleging grades are influenced by subjective “eye appeal” rather than consistent grading standards.

The filing also claims PSA benefits financially when collectors repeatedly resubmit cards in hopes of receiving higher grades, generating additional grading fees through inconsistent results.

🚨 PSA just got hit with a massive class action lawsuit claiming its entire multi-billion-dollar grading empire started with a known FRAUD.

Certificate #00000001 – the first card they ever graded – was a secretly trimmed T206 Honus Wagner.

THE GRADER KNEW IT WAS ALTERED. PSA’s… pic.twitter.com/nyDwnkZ1zA

— Ariel Givner (@GivnerAriel) July 29, 2026

Another major allegation centers on PSA’s role within Collectors Holdings, which owns businesses across multiple parts of the trading card industry, including vault storage, pricing tools and marketplace services. The lawsuit argues this creates financial conflicts of interest that are not adequately disclosed to customers.

The complaint also questions the qualifications and transparency of PSA’s grading staff, alleging customers are not told who graded their cards or what experience those graders have.

One of the lawsuit’s most notable claims involves PSA’s first certification, alleging the company knowingly graded an altered T206 Honus Wagner card despite its published standards stating altered cards should not receive grades. The complaint claims the certification has never been revoked.

The lawsuit further alleges PSA intentionally limits the number of Gem Mint 10 grades issued for certain cards in order to preserve scarcity and market value, rather than grading solely based on condition.

The complaint brings multiple claims against PSA and Collectors Holdings, including alleged violations of the federal Racketeer Influenced and Corrupt Organizations Act (RICO), fraud, negligent misrepresentation, breach of contract, unjust enrichment and violations of Maryland’s Consumer Protection Act.

The plaintiff is seeking class action certification, monetary damages, restitution of grading fees, changes to PSA’s business practices and additional relief under federal law.

The case is in its early stages, and the court has not ruled on the allegations. PSA has not yet filed a response to the complaint.