OPINION: This article may contain commentary which reflects the author's opinion.
A large number of Hollywood celebrities and prominent sports figures have been named in a major class-action lawsuit following their “insidious” endorsement of a now-defunct crypto exchange.
According to Deadline, “Less than a month after the likes of Larry David, Tom Brady, Gisele Bundchen, and Stephen Curry were sued for bringing their well-compensated star power to pitch now collapsed cryptocurrency firm FTX, a new class action filed in federal court aims to take the Golden State Warriors superstar and a pantheon of big names to the financial woodshed over shilling Bored Ape Yacht Club NFTs for hidden payoffs.”
In addition to naming Curry again, the new class-action suit also names Kevin Hart, Madonna, Jimmy Fallon, Justin Bieber, Paris Hilton, Serena Williams, DJ Khaled, Gwyneth Paltrow, and more, Deadline noted, adding: “Along with Universal TV also being named as a defendant, high profile music manager Guy Oseary is specified as the brains behind the whole alleged big bucks scam.”
The suit, filed by plaintiffs Adonis Real and Adam Titcher on December 8 in U.S. District Court in California, claims: “The manufactured celebrity endorsements and misleading promotions regarding the launch of an entire BAYC ecosystem (the so-called Otherside metaverse) were able to artificially increase the interest in and price of the BAYC NFTs during the Relevant Period, causing investors to purchase these losing investments at drastically inflated prices.”
The suit seeks a trial by jury and makes 10 claims overall.
“This case epitomizes these concerns as it involves a vast scheme between a blockchain start-up company, Yuga Labs, Inc. (“Yuga”), a highly connected Hollywood talent agent (Defendant Guy Oseary), and a front operation (MoonPay), who all united for the purpose of promoting and selling a suite of digital assets. The executives at Yuga and Oseary together devised a plan to leverage their vast network of A-list musicians, athletes, and celebrity clients and associates to misleadingly promote and sell the Yuga Financial Products,” it states.
On their various platforms and, in the case of Fallon during “The Tonight Show” in late November 2021, the celebrity figures all praised the Yuga Labs-backed NAYC NFTs and pitched them to the general public by saying they themselves were customers.
While the allure of the non-fungible tokens has considerably tanked in recent months, BAYC buyers eagerly jumped aboard last year, but the buy-ins rapidly proved to be “losing investments at drastically inflated prices,” the suit states.
“The truth is that the Company’s entire business model relies on using insidious marketing and promotional activities from A-list celebrities that are highly compensated (without disclosing such), to increase demand of the Yuga securities by convincing potential retail investors that the price of these digital assets would appreciate,” the 95-page fraud complaint says, according to Deadline.
The suit states as well that some of the celebrities gave their thumbs-up to the BAYC NFTs without revealing that they were being compensated, often in a big way, to promote them.
“During the Class Period, Defendants engaged in a plan, scheme, conspiracy, and course of conduct pursuant to which they knowingly or recklessly engaged in acts, transactions, practices, and courses of business that operated as a fraud and deceit upon Plaintiffs and the other members of the Class,” the document declares. “In truth, the Executive Defendants and Oseary used their connections to MoonPay and its service as a covert way to compensate the Promoter Defendants for their promotions of the BAYC NFTs without disclosing it to unsuspecting investors,” the suit continues.
It seeks damages that are “actual, general, special, incidental, statutory, punitive,” as well as “consequential damages and restitution.”
A Yuga Labs spokesperson criticized the lawsuit. “In our view, these claims are opportunistic and parasitic. We strongly believe that they are without merit and look forward to proving as much,” the spokesperson said.
The Western Journal noted further: “This lawsuit is the latest woe to befall the crypto economy. In late November, the Department of Justice charged 21 people for using cryptocurrency to money launder. Given the unregulated nature of cryptocurrency, money laundering is a constant concern with it. Much more significantly, cryptocurrency exchange company FTX has made all sorts of negative headlines recently — from going bankrupt to having former CEO Sam Bankman-Fried exposed as a huckster who stole from the poor and gave to the mega-rich Democrats.”
