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- The class action lawsuit against Kim Kardashian, Floyd Mayweather and other celebrity promoters of Ethereummax has been dismissed
- The judge ruled that the case wasn’t strong enough to proceed, although it might with some revisions
- A group of traders sued the celebs and the Ethereummax founders over their EMAX losses
A class action lawsuit against the celebrity promoters and the creators of the Ethereummax cryptocurrency has been tossed after the judge ruled that the claims didn’t meet the threshold required to carry the case forward. However, he did leave the door open for a re-filing if the plaintiffs, led by Ryan Huegerich, could come up with a stronger case down the line. The defendants in the case included Kim Kardashian and boxer Floyd Mayweather, as well as Ethereummax founders Steve Gentile and Giovanni Perone.
Class Action Lawsuit Fingered Celeb Promoters
Huegerich filed the class action lawsuit in January, claiming that Gentile and Perone paid the celebs to “(tout) the prospects of the Company and the ability for investors to make significant returns due to the favorable “tokenomics” of the EMAX Tokens”, when in fact their sole plan was to profit personally by selling their stash of tokens for profit as soon as it listed on exchanges.
Things weren’t looking great early last month when the judge in the case, U.S. District Judge Michael Fitzgerald, criticized the lawyers representing the plaintiffs for “trying to act like” the U.S. Securities and Exchange Commission (SEC), and added that there was “just a lot that is wrong” with the case.
Judge Leaves Door Open for Re-filing
Kardasishan’s $1.26 million settlement with the SEC in October doesn’t seem to have influenced the judge’s thinking as he threw out the case, ruling that the fraud allegations lacked merit and that investors also have the responsibility to conduct due diligence on their investments:
…while the law certainly places limits on those advertisers, it also expects investors to act reasonably before basing their bets on the zeitgeist of the moment.
While the case was dismissed it wasn’t done so with prejudice, which means it can be retried if the investor’s legal team amends a few provisions from its original filing, with Judge Fitzgerald making reference to the reciting of a provision under the Racketeer Influenced and Corrupt Organizations Act (RICO).
We can therefore expect a refiling to take place and the potential for the case to get further than the first hurdle if it is.