Kim Kardashian, Floyd Mayweather, and former NBA star Paul Pierce are just three of the celebrities currently facing some potential legal hot water surrounding their involvement in a cryptocurrency called EthereumMax,. The lawsuit alleges that they all made various "false or misleading statements to investors about EthereumMax through social media advertisements and other promotional activities," and now they're potentially on the hook for damages.
The founders of the cryptocurrency among those named in the class-action lawsuit, filed in the U.S. District Court for the Central District of California. According to that suit, the EthereumMax cryptocurrency is a "speculative digital token created by a mysterious group of cryptocurrency developers" and that by promoting it the celebrities in question were allegedly guilty of participating in a classic financial scheme.
Dimitrios Kambouris/Getty Images
That would be a "pump and dump," by which the public is convinced to buy up a certain stock or in this case cryptocurrency, driving up the price, after which the celebrities and public figures doing the convincing unload their own stock, make a bundle, and leave the suckers holding the now devalued stock for themselves. That is essentially what the people named in this lawsuit are accused of doing by a group of complainants who lost money on the crypto, headed by investor Ryan Huegerich.
Anyone who lost money on EMAX tokens between May 14, 2021 and June 27, 2021 can take part in the class action suit, but according to a company spokesperson for the cryptocurrency it's the lawsuit is based on a "deceptive narrative" that's "riddled with misinformation."
Kim Kardashian made an Instagram post asking followers to invest in EMAX last year, a post that already earned her some negative attention from the U.K.'s Financial Conduct Authority. Floyd Mayweather took the opportunity to promote the token at a 2021 boxing match with Logan Paul, while Paul Pierce promoted the token on his Twitter account.
Time will tell whether they might now be on the hook for serious damages as a result of those actions.
