Floyd Mayweather, Kim Kardashian and Paul Pierce Among Celebrities Being Sued Over Alleged Involvement in Cryptocurrency Scheme
The cryptocurrency company disputed the claims, saying the allegations are riddled with misinformation.
Last Friday, New York resident Ryan Huegerich filed a class-action lawsuit against several celebrities for promoting the cryptocurrency EthereumMax, and then selling it when prices increased. The lawsuit names celebrities such as Kim Kardashian, Floyd Mayweather and former ESPN sports commentator Paul Pierce, in addition to EthereumMax.
"The Company’s executives, collaborating with several celebrity promoters, (a) made false or misleading statements to investors about EthereumMax through social media advertisements and other promotional activities and (b) disguised their control over EthereumMax and a significant percent of the EMAX Tokens that were available for public trading during the Relevant Period (the “Float”)," the lawsuit alleges. "In truth, Defendants marketed the EMAX Tokens to investors so that they could sell their portion of the Float for a profit."
The lawsuit was filed on behalf of those who invested in EthereumMax tokens between May 14, 2021 and June 27, 2021, the time during which celebrities promoted the cryptocurrency.
Kim Kardashian promoted EthereumMax through a post on Instagram Stories, writing, "Are you guys into crypto???? This is not financial advice but sharing what my friends just told me about the Ethereum Max token!” alongside the hashtag #AD, suggesting she was paid for the post.
Former ESPN commentator Paul Pierce also mentioned EthereumMax on social media, writing about the cryptocurrency during a dispute with the sports network.
.@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. TRUTH shall set u Free my own Bosshttps://t.co/3irnuWYve3 check it out for yourself— Paul Pierce (@paulpierce34) May 26, 2021
Meanwhile, boxer Floyd Mayweather endorsed the token in his boxing match with YouTube star Logan Paul, where EthereumMax could be used to purchase tickets. The lawsuit claims that EthereumMax's trading volume "exploded" as a result of the publicity from Pierce and Mayweather.
"While Plaintiff and Class members were buying the inappropriately promoted EMAX Tokens, Defendants were able to, and did, sell their EMAX Tokens during the Relevant Period for substantial profits," the lawsuit states.
EthereumMax's star-studded promotions have brought along some outside criticism. During a speech at the Cambridge International Symposium on Economic Crime, Britain Financial Conduct Authority chairman Charles Randell said Kardashian's post "may have been the financial promotion with the single biggest audience reach in history."
"Of course, I can’t say whether [EthereumMax] is a scam. But social media influencers are routinely paid by scammers to help them pump and dump new tokens on the back of pure speculation," he said.
A statement from EthereumMax denied the allegations.
"The deceptive narrative associated with the recent allegations is riddled with misinformation about the EthereumMax project," the company said. "We dispute the allegations and look forward to the truth coming out."
Related: The 50 Richest People in Crypto