Crypto

Kim Kardashian, Floyd Mayweather file motion to dismiss crypto promotion lawsuit

02/24/2023
Bitcoin Ethereum News

Kim Kardashian, Floyd Mayweather and other celebrities are looking to convince a judge to dismiss another revised attempt to hold them liable for allegedly promoting EthereumMax (EMAX) without proper disclosure. 

The celebrities asked a California federal judge to dismiss a second amended complaint from EthereumMax investors filed in December 2022. According to the defendants, the renewed allegations push the “same basic theory” forward that the court had previously dismissed. 

The investors’ class-action lawsuit runs on the premise that the EthereumMax team worked with the celebrities to sell EMAX tokens to investors in what they describe as a “pump-and-dump” scheme.

However, the defendant’s motion to dismiss the renewed complaint argues that the theory revolving around celebrities advertising the EMAX tokens to pump its price artificially was already rejected by the court since the tokens do not have any value apart from what the market is willing to pay for. They wrote:

“The Court otherwise dismissed the prior complaint in full due to fundamental flaws. The addition of new claims, Defendants, and over 100 pages of largely irrelevant allegations does not cure the defects.”

In addition, the motion suggests that the investors’ new theory is that they held onto EMAX due to misrepresentations from the celebrities. However, the motion to dismiss argues that the investors “suffered no injury from merely holding onto the tokens.“

Related: Celebs who got burned endorsing crypto and those that got away with it

Meanwhile, Kardashian has already been fined once because of EthereumMax promotions on social media. On Oct. 3, 2022, the American socialite reached a $1.26 million settlement with the United States Securities and Exchange Commission (SEC) after failing to disclose that she received a $250,000 payment to promote the crypto project.

The SEC has recently issued a warning to celebrities who promote crypto. On Feb. 17, the SEC reminded stars that the law requires them to disclose how much they are getting paid and from whom when promoting investment in securities.