Celebs Kardashian and Mayweather Sued for Crypto Pump and Dump
The class-action complaint was filed on Friday in the U.S. District Court for the Central District of California. It alleges that Kardashian and Mayweather led investors into a crypto ‘pump and dump’ scam.
A New York resident named Ryan Huegerich is suing the company behind the EthereumMax (EMAX) cryptocurrency and those that promoted it at the time. The plaintiff stated that he was acting on behalf of everyone who bought the EMAX tokens between May 14 and June 27, 2021.
The defendants, who include Boston Celtics star Paul Pierce, are accused of making “false or misleading statements to investors about EthereumMax through social media advertisements and other promotional activities,” according to a Wall Street Journal report on Jan. 11.
Crypto Pump and Dump
EthereumMax is a “speculative digital token created by a mysterious group of cryptocurrency developers,” according to the lawsuit. The plaintiff did not disclose how much he spent or lost on EMAX but claimed to have “suffered investment losses as a result of Defendants’ conduct.”
Floyd Mayweather shilled the token in May 2021 when it was promoted as an exclusive way to buy tickets for a pay-per-view fight between Mayweather and Logan Paul scheduled the following month.
According to the lawsuit, the pro-boxer and members of his entourage wore EMAX t-shirts while attending a Bitcoin conference in Miami a couple of days before the fight.
Former NBA player and sports commentator, Paul Pierce, also promoted the token in a tweet on May 27 when he said “@espn I don’t need you. I got @ethereum_max. I made more money with this crypto in the past month then I did with y’all in a year.”
Kim Kardashian, who is trying to become a lawyer herself, plugged EMAX to her 278 million followers on Instagram. The reality TV star asked her followers on the social media platform to join the “Ethereum Max Community”. According to a screenshot from the complaint, she wrote:
“Are you guys into crypto???? This is not financial advice but sharing what my friends just told me about the Ethereum Max token,”
The plugging caught the attention of the head of the U.K.’s Financial Conduct Authority, Charles Randall, who said in September that she was fraudulent with “the financial promotion with the single biggest audience reach in history,” before adding that there was a need for a “permanent and consistent solution to the problem of online fraud from paid-for advertising.”
The amount sought in the class action was not specified but it did state it was seeking “all actual, general, special, incidental, statutory, punitive, and consequential damages and restitution.”
EMAX tokens have collapsed by 97.2% from their late-May all-time high of $0.000000597. It is currently trading at $0.000000016 and volumes are minimal.
According to CoinGecko, the token surged more than 20,000% on May 31 but had collapsed to a fraction of this by mid-June.Source