Justin Bieber, Madonna, Steph Curry, Kevin Hart and Serena Williams sued for ... trends now
Several celebrities are named in a class-action lawsuit filed against Yugo Labs, the company behind NFT series Bored Ape Yacht Club, that alleges the firm engaged in a conspiracy with the A-listers to defraud potential investors.
The complaint was filed on Friday in Los Angeles federal district court on behalf of investors who claim it failed to disclose the alleged involvement of celebrities in promoting and selling NFTs.
Among the 37 defendants named for their alleged involvement in 'promoting and selling a suite of digital assets,' were Kevin Hart, Gwyneth Paltrow, Madonna, Justin Bieber, Serena Williams, Jimmy Fallon, Paris Hilton, Snoop Dogg, The Weeknd, Post Malone and NBA star Steph Curry.
Bored Ape comprises more than 10,000 NFTs depicting cartoon monkeys wearing various outfits. It's one of the most successful NFT art collections, valued at more than $1 billion, Insider reported.
Several celebrities - including Justin Bieber - are named in a lawsuit filed against Yugo Labs, the company behind NFT series Bored Ape Yacht Club, that alleges it engaged in a conspiracy to defraud potential investors
Madonna, who discussed Bored Apes in a Rolling Stone feature, was named in the complaint. It was filed on behalf of investors who claim it failed to disclose the alleged involvement of celebrities in promoting and selling NFTs
Adonis Real and Adam Titcher, who have been investing in YugoLabs NFTs since April 2021, filed the complaint.
The complaint alleges that the celebrities praised the Yuga Labs backed BAYC NFTs to the public by claiming to be customers themselves.
'Defendants' promotional campaign was wildly successful, generating billions of dollars in sales and re-sales,' according to the lawsuit.
But it alleges that the 'billions of dollars' were generated in sales and re-sales through manufactured celebrity endorsements and misleading promotions, and 'at no point did any of the defendants register these securities with the SEC.'
'The manufactured celebrity endorsements and misleading promotions regarding the launch of an entire BAYC ecosystem (the so-called Otherside metaverse) were able to artificially increase the interest in and price of the BAYC NFTs during the Relevant Period, causing investors to purchase these losing investments at drastically inflated prices.'
The lawsuit further states that the company's 'entire business model relies on using insidious marketing and promotional activities from A-list celebrities that are highly compensated (without disclosing such), to increase demand of the Yuga securities by convincing potential retail investors that the price of these digital assets would appreciate.'
Comedian Kevin Hart was the among the 37 defendants named for their alleged involvement in 'promoting and selling a suite of digital assets'
The complaint alleges that A-listers - including Serena Williams - praised the Yuga Labs backed BAYC NFTs to the public by claiming to be customers themselves
Gwyneth Paltrow announced to investors on January 26 that she 'joined' the BAYC community and thanked MoonPay for its services in facilitating the purchase, but did not disclose that she has a financial stake in the firm, the Hollywood Reporter stated
The complaint alleges that Yuga Labs conspired with Hollywood talent manager Guy Oseary, and the crypto-trading app MoonPay to get celebrities to promote BAYC NFTs while hiding that they were compensating those celebrities for promotion.
One of the examples in the complaint revealed that MoonPay posted a clip in November 2021 from Post Malone's music video for 'One Right Now,' where the rapper is seen buying a Bored Ape on the MoonPay app with musician The Weeknd.
'This just happened,' according to the MoonPay Twitter post.
The statement alleges that the transactions show that Malone was transferred $1.4 million worth of ether in October 2021, which the plaintiffs claim is evidence that he was paid for his promotion of BAYC.
'MoonPay's statement that 'this just happened' misleadingly suggested to investors that the promotion of MoonPay and the BAYC NFT collection within the so-called music video from Defendants Post and Tesfaye [the Weeknd] was something that occurred because of their genuine interest in the BAYC NFTs,' according to the complaint.
One of the examples in the complaint revealed that MoonPay posted a clip in November 2021 from Post Malone's music video for 'One Right Now,' where the rapper is seen buying a Bored Ape on the MoonPay app with musician The Weeknd
'In truth, the Executive Defendants and Oseary used their connections to MoonPay and its service as a covert way to compensate the Promoter Defendants for their promotions of the BAYC NFTs without disclosing it to unsuspecting investors,'
