Bieber, Madonna, other celebs named in crypto class action against Yuga Labs

Yuga Labs class action lawsuit overview:

• Who: Plaintiffs Adonis Real and Adam Titcher filed a class action lawsuit against blockchain startup Yuga Labs, a well-connected Hollywood agent, and a number of celebrities.
• Why: They allege the defendants worked together to manufacture interest in Yuga’s digital assets, including Bored Ape Yacht Club NFTs.
• Where: The crypto class action lawsuit was filed in California federal court.

A crypto class action lawsuit alleges blockchain startup company Yuga Labs and a well-connected Hollywood agent recruited celebrities to promote and sell Yuga’s suite of digital assets, including its Bored Ape Yacht Club collection.

Plaintiffs Adonis Real and Adam Titcher filed the 95-page crypto class action lawsuit on behalf of themselves and other investors who purchased Yuga’s non-fungible tokens (NFTs) or ApeCoin tokens since April 23, 2021.

The Yuga Labs class action lawsuit names more than two dozen defendants who participated in the allegedly illegal scheme to promote ApeCoin and Yuga’s NFTs. The named defendants include high-profile celebrities such as Justin Bieber, Madonna, Jimmy Fallon, Kevin Hart, Gwyneth Paltrow and Serena Williams.

Real and Titcher point to a statement from the U.S. Securities and Exchange Commission (SEC) over concerns about celebrities promoting cryptocurrencies.

“Celebrities and others are using social media networks to encourage the public to purchase stocks and other investments,” the SEC statement reads. “These endorsements may be unlawful if they do not disclose the nature, source, and amount of any compensation paid, directly or indirectly, by the company in exchange for the endorsement.”

Crypto class action says defendants manufactured interest in NFTs, concealed payments to celebrities

The Yuga Labs class action lawsuit alleges Yuga Labs, Hollywood agent Guy Oseary and a front operation called MoonPay worked together to recruit A-listers to misleadingly promote and sell Yuga’s financial products.

Real and Titcher allege the defendants manufactured the purported interest in Bored Ape Yacht Club NFTs by recruiting celebrities to endorse their products. The MoonPay defendants provided a way to discreetly pay the celebrities so their participation in the crypto scheme would appear organic, the crypto class action lawsuit alleges.

“Defendants’ promotional campaign was wildly successful, generating billions of dollars in sales and re-sales,” according to the Yuga Labs class action lawsuit. 

The “manufactured celebrity endorsements and misleading promotions” of the Bored Ape Yacht Club NFT launch resulted in artificially-inflated interest in the products, causing investors to purchase the investments at significantly inflated prices, the plaintiffs claim.

Following the success of the NFT sales, Yuga Labs allegedly created digital assets called ApeCoins that they would provide to Bored Ape NFT owners, but the defendants failed to register these securities with the SEC, the crypto class action alleges.

“In our view, these claims are opportunistic and parasitic. We strongly believe that they are without merit, and look forward to proving as much,” a Yuga Labs spokesperson wrote in an email to Top Class Actions.

The Yuga Labs class action lawsuit asserts claims for violations of the California Unfair Competition Law, California Consumers Legal Remedies Act, the Securities Exchange Act, violations of California common law and for unjust enrichment.

Former boxer Floyd Mayweather is also facing a crypto class action lawsuit alleging he promoted an allegedly fraudulent cryptocurrency token called EtheriumMax.

What do you think about the Yuga Labs class action lawsuit? Let us know in the comments!

Real and Titcher are represented by John T. Jasnoch of Scott+Scott Attorneys at Law LLP.

The Yuga Labs crypto class action lawsuit is Adonis Real, et al. v. Yuga Labs Inc., et al., Case No. 2:22-cv-08909, in the U.S. District Court for the Central District of California, Western Division.

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