Cristiano Ronaldo, MLB, and Mercedes F1 Hit with Litigation

Cristiano Ronaldo, MLB, and Mercedes F1 Hit with Litigation


Good day everyone,

I hope you are all well and had an excellent week, welcome to CryptoGod-1’s blog on all things crypto. In this post I will be looking at the four recent filing made in Miami for the promotion of Binance and FTX as reputable and safe organisation for investing money into cryptocurrency.

 

 

Cristiano Ronaldo, MLB, and Mercedes F1

Just a month after FTX founder, Sam Bankman-Fried, was found guilty on seven different fraud-related charges in Manhattan federal court, and less than a week after Binance founder Changpeng “CZ” Zhao pleaded guilty to violating numerous federal statutes, including the Bank Secrecy Act, there have been four recent class action lawsuits filed against high-profile organisations. This is according to court documents filed in Miami on Monday the 27th of November 2023. The four named among the defendants are Cristiano Ronaldo, Major League Baseball, F1, and Mercedes-Benz and global advertising agency, Dentsu. The filing was made by class action specialist Adam Moskowitz, who helped win a huge settlement in the Surfside tower collapse in Florida.

Of the lawsuits, three are involved with numerous organizations accused of “aiding and abetting and/or actively participating in the massive, multi-billion dollar fraud” committed by FTX. It is claimed this way done through through advertising the company as a safe and reputable exchange to create a sense of ease and trust for consumers. The final lawsuit, which is centred around football superstar Cristiano Ronaldo, alleges he partnered with Binance and engaged in mass solicitation of investments in unregistered securities on behalf of Binance. The filing against the Portuguese soccer star read in part:

 

“Evidence now reveals that Binance’s fraud was only able to reach such heights through the offer and sale of unregistered securities, with the willing help and assistance of some of the wealthiest, powerful and recognized organizations and celebrities across the globe – just like Defendant Ronaldo. Binance’s partnership with celebrities like Ronaldo was clearly designed to use the positive reputation associated with specific celebrities to convince consumers that Binance was a safe place to buy and sell cryptocurrency.”

 

 

 

Bankman-Fried and Zhao

During the recent trial of Sam Bankman-Fried the prosecution alleged the defendant and a number of his associates had undisclosed access to customer funds. They are reported to have funded their lavish lifestyle, including a mansion in the Bahamas, from their access to these customers funds. When the FTX cryptocurrency exchange collapsed, along with its sister company, Alameda Research, they were almost $8 billion in the red from spending customers money.

Prosecutors alleged he had made use of customer funds to finance various high-profile sponsorship deals. This included the $150 million deal with Major League Baseball and $205 million deal with the stadium formerly known as FTX arena in Miami. Many more celebrities, such as Larry David, Steph Curry, Tom Brady, and Kevin O’Leary, were paid large sums generally in the tens of millions to advertise on behalf of FTX.

With Bankman-Fried currently being held at Brooklyn’s Metropolitan Detention Center before being sentenced on the 28th of March next year, along with the prospect of also facing another trial on additional charges such as foreign bribery. Bankman-Fried could spend decades in prison and at his recent trial his former head of engineering at FTX, Nishad Singh, noted how Bankman-Fried was spending lavish and absurd amounts which “reeked of excess and flashiness.”

Changpeng “CZ” Zhao meanwhile is a current Dubai resident who was recently instructed by a federal judge not to leave the United States. He has resigned as CEO of Binance with the cryptocurrency exchange facing a $4.3 billion payment in forfeitures while also making a “complete exit” from the U.S. market. Despite this settlement Zhao is facing legal challenges as the Securities and Exchange Commission (SEC) is still probing the exchange and seeking evidence regarding Binance.US’s alleged backdoor control over customer assets. This is highlighting the similarities between both FTX and Binance, and it seems the SEC is not so willing to drop the legal action they initiated against Binance back in June 2023 over their alleged involvement in the sale of unregistered securities.

While Binance has agreed to its settlement with the DOJ for violating Anti-Money Laundering laws and operating an unregistered money-transmitting business, they will also be required to commit to up to five years of compliance monitoring by the U.S. Department of Justice and the Department of the Treasury.

Zhao may face anywhere from a potential 12-18 months in prison for his actions as CEO of Binance and will be sentenced in late February 2024, while Bankman-Fried is facing potentially decades or even life in prison.

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Changpeng “CZ” Zhao and Sam "SBF" Bankman-Fried

 

 

Ronaldo in Hot Water

Cristiano Ronaldo, the Portuguese soccer superstar who has represented Sporting Lisbon, Manchester United, Real Madrid, Juventus, and now Saudi Pro League club Al Nassr, is facing a proposed class-action lawsuit for promoting the cryptocurrency exchange Binance. The lawsuit asserts that Ronaldo played a role in the sale of unregistered securities in conjunction with Binance.

Ronaldo entered into a multiyear partnership with Binance back in mid-2022 for the soccer star to promote a series of his own nonfungible tokens (NFTs). Several of these NFTs are tied to Binance and the complaint is arguing that by associating with Binance it made sure that users who purchased Ronaldo’s NFTs were more likely to engage with Binance for other purposes, such as investing in what the plaintiffs claim are unregistered securities. This includes tokens such as Binance's BNB token, or making use of Binance's crypto yield services.

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Cristiano Ronaldo

 

The filing outlines how through his endorsement of Binance, Ronaldo subjected his massive following of 850 million social media users to exposure of the exchange which in turn helped to contribute to the exchange's popularity. The plaintiffs contend that Ronaldo’s NFT sales were exceptionally successful in promoting Binance, and they went on to argue this resulted in a 500% increase in searches for the exchange during the week following the initial sale.

 

“Ronaldo’s promotions solicited or assisted Binance in soliciting investments in unregistered securities by encouraging his millions of followers, fans, and supporters to invest with the Binance platform.”

 

They also assert within the lawsuit that Ronaldo should have been aware of Binance’s sale of unregistered crypto securities, especially given his vast experience in investing while also claiming his substantial resources that could have been used to seek external advice. Finally, the lawsuit also references advice and guidelines given from the SEC for celebrities, which warns about the necessity of disclosing payments received for promoting cryptocurrencies. Ronaldo failed to fulfil this requirement and in doing so left himself exposed.

 

 

 

Courtroom Filings

The lawsuits have been brought forth by the team that's seeking billions of dollars in damages from three dozen celebrities for unlawfully promoting failed crypto exchange FTX and struggling rival Binance. They have now added this four famous new targets to the list and as of the 27th of November 2023 filed a total of four class action lawsuits. As noted above, the defendants are Major League Baseball; Formula 1 and Mercedes-Benz, sponsor of its signature racing team; and as dual defendants, ad giant Dentsu and global talent agency Wasserman, for their involvement in promoting FTX. Soccer legend Cristiano Ronaldo is the fourth defendant for his involvement as a onetime worldwide pitchperson for Binance.

Adam Moskowitz explained the rationale in bringing fresh defendants into the mix, especially given the recent highly significant legal rulings, along with his legal legend David Boies. Together they have already filed three active cases against celebrities and billionaires for touting tokens and accounts at digital exchanges. Within those existing suits include sports stars Tom Brady and Steph Curry as FTX brand ambassadors, along with Mark Cuban for forging a promotional deal between Voyager and his NBA Mavericks side, while finally Rob Gronkowski, who also did promos for the bankrupt exchange. Moskowitz noted:

 

“I always believed we had the law on our side in all those cases. But when we brought the Voyager and Cuban action [in 2022], the law wasn’t settled.”

 

This is in reference to a 2019 decision that if an investor lost money on a dicey investment, they could only collect damages from the promoter if that promoter directly and personally solicited their business in a letter or email, but not from YouTube or Instagram. Moskowitz forged ahead with the celebrity suits as he is of the belief that the 2019 decision contradicted the spirit of the Securities Act of 1933. However, in 2022 the 11th Circuit Court of Appeals governing Alabama, Georgia, and Florida upended the “only liable if the pitch was direct” ruling.

However, in September, the Ninth Circuit Court of Appeals covering California and Arizona confirmed the 11th decision. They noted that correctly interpreted, the Securities Act required that promoters using the internet or any other mass media were liable for their customers’ losses, if they provide misleading information. Their ruling meant the judges found it appalling that promoters who had caused grave harm would pretty much get away with anything under the old rules. Thus, those decision were game changers and new, updated laws for the internet age were formed.

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Adam Moskowitz, David Boies, and Stephen Zack

 

Moskowitz has gone on to stress he is suing under a law that enjoys a special, extremely punitive status: penalties for the promotion of unregistered securities. According to Moskowitz, if the product is found to be an unregistered security and if the promoter had a financial interest, they’re liable regardless of what words they selected in their promotion. Given that the law now clearly states any promotion on social media can be liable for clients losses, Moskowitz believes his celebrity suits enjoy a solid legal basis, especially given that the SEC views digital coins / tokens, along with their earn programs, to be unregistered securities.

Moskowitz decided to push ahead with the four new actions in federal court in South Florida along with obtaining important information from cooperating defendants. As part of the MLB suit they are claiming that FTX paid for ads during game broadcasts and promos for home run derbys, along with having the umpires wearing the FTX logo on their uniforms. Moskowitz is unaware of how much FTX paid the MLB league for this privilege, but he expects it to emerge in discovery. He also noted:

 

“You have to remember that MLB was in a dire economic state during the COVID crisis, with no idea how long the stadiums would remain empty, so they decided to take the risk of doing a deal with FTX. It appears that the NFL was much more prudent and didn’t risk partnering with FTX.”

 

Moskowitz went on to note how the DOJ-Binance settlement means the world's largest cryptocurrency exchange is allowed to continue operating, which will increase the chances of people getting their money out. However he noted that bankrupt FTX may require huge success on his team's behalf to recover a significant portion of their investments.

 

“The current estimate in the bankruptcy court puts the total losses for FTX investors alone at $11 billion. The Binance losses may add more billions to the total. We’re just trying to [get] something back for the victims who’ve so far recovered pennies."

 

 

 

Have a great day,

Peace. CryptoGod-1.

 

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cryptogod-1
cryptogod-1

Writer, designer, creator, and life enthusiast. I love to read and write and enjoy sharing my passion for crypto, sports, literature and everything and anything I can enjoy in life.


CryptoGod-1 : Crypto & Blockchain
CryptoGod-1 : Crypto & Blockchain

Enthusiast here looking to share my ideas, thoughts, analysis, and experience when it comes to all things crypto

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