Mercedes-Benz F1 Team and MLB Face Lawsuits Over Alleged FTX Crypto Fraud Promotions
Summary:
A group of FTX users have filed twin class-action lawsuits against Mercedes-Benz's Formula One team and Major League Baseball, accusing them of contributing to FTX's alleged fraud through promotional deals with the crypto exchange. The users allege these firms promoted unregistered securities and directly participated in the crypto group's worldwide fraud. Similar allegations have been made against celebrities who have endorsed FTX. FTX's ex-CEO, Sam Bankman-Fried, was previously convicted on multiple fraud-related charges.
A consortium of FTX users alleges that Mercedes-Benz's Formula One team and Major League Baseball played instrumental roles in FTX's fraudulent activities by entering into advertising agreements with the crypto corporation. The petitioners, who are also FTX customers, launched parallel class-action lawsuits in a Florida District court on November 27, charging the organizations with direct involvement or facilitation in the FTX Group's extensive, multibillion-dollar worldwide scam. They also accuse the companies of advertising unregistered securities.
Mercedes F1 team inked a marketing agreement with FTX last year, resulting in FTX's emblem prominently displayed on cars, uniforms, and a variety of other items. In the same year, MLB also joined hands with FTX in a comparable arrangement—the first by any professional sporting organization—that saw umpires sport FTX's logo on their uniforms. As per the class complaint, FTX patches on all MLB umpire uniforms were considered the key element in the partnership, marking the first time a sponsor's logo has been seen on umpire's uniforms since the baseball league's inception in the 1800s.
The allegations against Mercedes F1 were along comparable lines, with claims that the team featured FTX's logo on its cars and merchandise prominently. Furthermore, FTX often praised and celebrated Mercedes F1 and its drivers via which, as the plaintiffs assert, successfully instilled a level of credibility among Mercedes F1 supporters.
Moreover, this group of FTX patrons is continuing to legally challenge a bunch of celebrities, including ex-athletes Shaquille O'Neal and Tom Brady, who endorsed the exchange. They are citing similar accusations of unregistered securities promotion. Numerous celebrities named in the litigation have made attempts to dismiss the lawsuit against them, stating they didn't suggest depositing money onto FTX. Lastly, at least three individuals—Trevor Lawrence, a professional American football player, and YouTubers Kevin Paffrath, and Tom Nash—have reached settlements.
FTX's ex-chief executive officer and founder, Sam Bankman-Fried, was found guilty of multiple charges, including fraud, conspiracy, and money laundering earlier this month. Substantial aftermath followed just over a year after the promotional contract was signed, MLB terminated its five-year promotional contract with FTX soon after the company declared bankruptcy in November 2022. Likewise, Mercedes F1 also withdrew from its agreement with FTX that same year and erased its logo from all cars and merchandise.
Published At
11/28/2023 5:00:03 AM
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