Last Updated on January 15, 2024 by newseditor
In a class action lawsuit filed on Thursday, investors claim that celebrities like Madonna, Jimmy Fallon, Justin Bieber, Snoop Dogg, Kevin Hart, and Paris Hilton were paid to promote Bored Ape Yacht Club NFTs without disclosing the arrangements. U.S. Securities and Exchange Commission rules state that these endorsements are illegal if they fail to disclose the nature, source, and amount of any remuneration made, directly or indirectly, by the corporation in exchange for the endorsement.
Bored Ape Yacht Club NFTs Lawsuit
According to the complaint filed in the U.S. District Court, Adonis Real and Adam Titcher purchased NFTs from Yuga Labs, the company behind Bored Ape NFT and other NFT collections, because they were influenced to do so by the endorsements of influential celebrities. According to the plaintiffs, they were all part of a “vast scheme” to artificially inflate the value of the NFTs.
The class action lawsuit claims that the celebrities utilized their social media platforms to persuade the public to buy the Bored Ape NFT investments without providing the necessary disclosures. The complaint further alleged that Yuga Labs paid those who promoted the NFT collection through a third-party service named MoonPay. It was posited that Yuga Labs officials worked with Guy Oseary, who represents Bored Apes in Hollywood, and the crypto-trading service Moonpay to secretly pay celebrities to promote Bored Ape Yacht Club NFTs. According to the accusation, Oseary and several of his clients were early investors in MoonPay, the company accused of processing cryptocurrency and digital asset payments to celebrities for “organic” advertising.
It has been reported that the defendants’ marketing efforts were very successful, bringing in billions of dollars in sales and re-sales. The complaint says that the price and interest in the Bored Ape Yacht Club NFTs were boosted artificially, which led investors to buy the losing investments at much higher prices because of fake celebrity endorsements and misleading ads.
In addition to Gwyneth Paltrow and Post Malone, Stephen Curry and Serena Williams are also named in the Bored Ape NFT Lawsuit. Williams’s husband, Alex Ohanian, the founder of Reddit, and Amy Wu are also named in the Bored Ape lawsuit.
“In our perspective, these accusations are opportunistic and parasitic,” a representative from Yuga Labs told ARTnews. The defendants says they disagree with them wholeheartedly and hope to show that their belief is justified.
What next for the Bored Ape Yacht Club NFTs Lawsuit?
The plaintiffs’ claims centre around violations of antitrust statutes, aiding and abetting, and civil conspiracy. They hope to represent anyone who lost money on April 23, 2021, or after by investing in Yuga NFTs or Yuga’s cryptocurrency, ApeCoin. In the suit, they want to be tried by a jury and awarded compensation for their losses, as well as seek reimbursement for their legal bills and other expenses. Scott+Scott Attorneys at Law LLP is the law firm representing the plaintiffs.
