Kardashian and Mayweather push for crypto promotion suit dismissal
Among other celebrities, Kim Kardashian and Floyd Mayweather are pushing the judiciary to drop renewed charges on EthereumMax(EMAX) promotion allegations.
Why do the celebrities want the suit dismissed?
According to the celebrities, the renewed allegations are similar to the previously dismissed suit. They also stated that the court dismissed the first lawsuit due to fundamental flaws and that changing a few aspects of the case would not solve the problem.
The new lawsuit accuses the celebrities of colluding with the EMAX team to mislead fans and unlawfully promote the EMAX token. However, the defendants requested a California federal judge to dismiss the amended complaint filed by EthereumMax investors. The investors filed the suit in Dec. 2022.
Additionally, the defendant’s motion to dismiss shows that the court had rejected the pump-and-dump theory pushed by the investors. The investors insist that they held onto EMAX due to misrepresentations by the defendants.
However, the motion refutes the claims saying that the investors did not suffer injury just from holding their tokens. It also indicated that the EMAX tokens have no value besides what the market can pay.
The SEC warns celebrities promoting crypto firms
In Feb 2021, the U.S. Security and Exchange Commission (SEC) warned celebrities who endorse crypto. Moreover, the SEC reminded celebrities that the law needs them to disclose payment terms when promoting investments. Failure to disclose will attract penalties in fines for the guilty party.
Subsequently, on 3rd Oct 2022, the SEC penalized Kim Kardashian a $1.2 million fine for promoting EMAX on social media and failing to disclose that she had been paid $250,000 for the project.
Following the warning by the SEC, some stars in different industries have been burnt, while others got away without a scratch after promoting crypto firms. However, artists and other stars can still earn from their music since the industry embraced Web3 in 2022.