A federal judge has dismissed a lawsuit against the founders of EthereumMAX, a cryptocurrency, and the celebrities that promoted it on social media, including Kim Kardashian and Floyd Mayweather, according to court documents dated Dec. 6.
The investors who bought the cryptocurrency filed the suit, and allege that they suffered losses after seeing the posts on social media and purchasing it.
The lawsuit also states that the investors believe the celebrities conspired to artificially inflate the value of crypto.
“The Court acknowledges that this action raises legitimate concerns over celebrities’ ability to readily persuade millions of undiscerning followersto buy snake oil with unprecedented ease and reach,” wrote Judge Michael Fitzgerald in the lawsuit. “But, while the law certainly places limits on those advertisers, it also expects investors to act reasonably before basingtheir bets on the zeitgeist of the moment.”
The judge ultimately deemed the allegations insufficient.
“We are pleased with the Court’s well-reasoned ruling,” said Kim Kardashian’s lawyer Michael G. Rhodes, in an email to MarketWatch.
In October, Kardashian agreed to pay $1.26 million, to settle claims by the SEC for her failure to disclose that the EthereumMAX ad on her Instagram was a paid $250,000 ad.