Reports said that a federal judge dismissed a proposed class action lawsuit on Wednesday against Ethereummax’s founders and the crypto project’s celebrity endorsers, including reality TV star Kim Kardashian, boxer Floyd Mayweather Jr., and former Boston Celtics star Paul Pierce.
It has been reported that in his ruling, Judge Michael Fitzgerald of the US District Court for the Central District of California agreed that the lawsuit’s claims raised legitimate concerns about “celebrities’ ability to readily persuade millions of undiscerning followers to buy snake oil with unprecedented ease and reach.”
He explained:
“While the law certainly places limits on those advertisers, it also expects investors to act reasonably before basing their bets on the zeitgeist of the moment.”
However, Kardashian promoted Ethereummax and the EMAX cryptocurrency token in an Instagram post in June 2021. The reality TV star settled with the US Securities and Exchange Commission (SEC) in October for failing to disclose a $250,000 compensation for touting the crypto token on her Instagram account. Mayweather Jr. promoted the same crypto token at a boxing match and a large Miami bitcoin conference in June 2021.
Attorney John Jasnoch said:
“If plaintiffs had known the true facts related to the promoters’ financial interest in the tokens, and that they were being paid to shill these tokens, they wouldn’t have paid as much for the tokens as they did.”
Investors sued Ethereummax’s founders and the crypto project’s celebrity promoters in January after the EMAX cryptocurrency lost 97% of its value. Fitzgerald said in his ruling that he would allow the plaintiffs’ lawyers to refile their suit after amending some of their claims under a number of the statutes cited in the original filing.
Thus, Michael Rhodes, a lawyer for Kardashian, said:
“We’re pleased with the court’s well-reasoned decision on the case.”
Source: Bitcoin.com
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