The National Basketball Association (NBA) is the target of a lawsuit brought by a group of investors who allege the league’s marketing connection with crypto lender Voyager Digital.
Plaintiffs in the proposed class-action lawsuit, which was filed in a Miami District Court, claim that the NBA’s approval of Voyager’s advertising arrangement with the Dallas Mavericks amounted to gross negligence and caused losses of over $4.2 billion.
According to the case, Voyager Digital’s unregistered securities were promoted by the NBA, a promotional partner that served as a “gatekeeper” and should be held responsible for causing investors’ losses.
The plaintiffs further assert that the NBA accepted large promotional compensation in the midst of financial difficulties brought on by the COVID-19 outbreak, knowing full well that using crypto exchanges like Voyager, Coinbase, and FTX has dangers.
The lawsuit also names McCarter & English, Voyager’s legal counsel, claiming the firm misled investors and partners by giving them a bogus “Legal Opinion” and reassured them of the validity of Voyager’s services.
This case builds on a prior complaint filed against Mark Cuban, the former owner of the Dallas Mavericks, for allegedly endorsing Voyager Digital and fabricating information about its safety.
Due to linkages that the ongoing litigation uncovered, the class group decided to expand its action to include McCarter & English and the NBA.
The crypto lender’s demise started in July 2022 when it stopped taking withdrawals and declared bankruptcy as a result of its involvement with the defunct cryptocurrency hedge fund Three Arrows Capital (3AC).
Following the demise of FTX exchange in late 2022, a number of lawsuits have been filed against celebrities, sports teams, and individuals connected to cryptocurrency companies.
In addition, several well-known personalities have had legal issues with their affiliations with FTX, including the Mercedes Formula One Team, Major League Baseball (MLB), Tom Brady, Stephen Curry, Shaquille O’Neal, Larry David, and others.