Floyd Mayweather, Kim Kardashian crypto lawsuit dismissed by federal judge

On Wednesday, a federal judge dismissed a lawsuit filed against Floyd Mayweather and Kim Kardashian, as per The Hollywood Reporter. The class action lawsuit was filed against celebrity endorsers of the cryptocurrency EthereumMax (EMAX), accusing them of misleading their followers into buying EMAX tokens only to sell their own once the value of the cryptocurrency increased for profit.

The lawsuit comes amidst several allegations against celebrities for promoting cryptocurrency pump-and-dump schemes. A pump-and-dump is when a group inflates the currency by buying large commodities of it to drive up the price (pump). Thereafter, said group sells the commodity causing the value of the currency to drop which leads to massive losses to any currency holder (dump).

Floyd Mayweather, Kim Kardashian and Paul Pierce were named three of the alleged celebrity promoters.

The lawsuit stated:

"The company's executives, collaborating with several celebrity promoters... made false or misleading statements about EMAX through social media advertisements and other promotional activities."

---

Why did Floyd Mayweather and Kim Kardashian face a crypto lawsuit?

Floyd Mayweather vs. Logan Paul

Mayweather wore the EMAX company's logo on his boxing trunks in his exhibition fight against Logan Paul, which investors allege was “promotion in a widely viewed fight."

In June 2021, Kim Kardashian took to Instagram to post (since-deleted) an ad to her 250 million followers for EthereumMax, which has no relation to the already well-established cryptocurrency.

“Are you guys into crypto???? This is not financial advice but sharing what my friends just told me about the Ethereum Max token! A few minutes ago, Ethereum Max burned 400 trillion tokens – literally 50% of their admin wallet, giving back to the entire e-max community. Swipe up to join the e-max community."

According to the lawsuit, Kardashian included the "#AD hashtag" to imply that her post was a paid advertisement.

U.S. District Judge Michael Fitzgerald, who presided over the case, said that investors had failed to show that the executives and promoters schemed to mislead investors. In his ruling, the judge wrote:

“The investors' fraud claims failed because they had not stated whether or when they saw the promotions.”

The judge also mentioned that investors may amend and refile their proposed class action.

Sean Masson, a lawyer representing the investors in the EthereumMax case, said they plan to revise their claim to add "a host of additional facts demonstrating defendants' wrongdoing and liability."