A U.S. court has issued a mixed ruling in a class action lawsuit against basketball legend Shaquille O’Neal. The case was centered on O’Neal’s involvement with the Astrals NFT project. The court order has seen one allegation dismissed while another moves forward.
Defining Celebrity Responsibility in Crypto Promotions
The U.S. District Court for the Southern District of Florida, Miami Division, has drawn a line between different levels of involvement in crypto projects.
While dismissing claims that O’Neal was a “control person” in the Astrals project, the court found that his role could be classified as that of a “seller” due to his successful solicitation of product purchases.
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Astrals, a collection of 10,000 NFT 3D avatars linked to a decentralized autonomous organization (DAO), allegedly saw O’Neal urging investors to “hop on the wave before it’s too late.”
The lawsuit claims that O’Neal’s continued promotion, even after the FTX collapse, followed by his alleged departure from the project, led to a major drop in the value of Astral’s financial products.
Notably, the court did not dismiss allegations that Astrals sold unregistered securities. Adam Moskowitz, the attorney representing the investors, suggested that this ruling could bring clarity to other pending crypto class action litigations involving celebrity promotions.
O’Neal and the Astral project are required to respond to the allegations by September 12, 2024. This ruling may set a precedent for how celebrity endorsements in the crypto space are viewed legally.
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