A number of celebrities have reached a settlement in their lawsuits related to the sponsorship deals they had signed with the now-bankrupt FTX crypto exchange before its downfall last year.
An NFL quarterback for the Jacksonville Jaguars, Trevor Lawrence, reached a settlement in a lawsuit in which he was accused of misleading FTX investors for an undisclosed amount of money.
Settlements were also made by YouTubers Kevin Paffrath and Tom Nash, but no details about their terms have been revealed.
Bloomberg News first reported these developments.
In 2021, before the collapse of the FTX crypto exchange, Lawrence had entered into a sponsorship deal with an FTX subsidiary, Blockfolio.
On August 31st, a filing had been submitted in the US Bankruptcy Court, which revealed that a sum of $205,555.35 had been paid to Lawrence by the company.
At the time, Sina Nader, the then-COO of FTX, had said that sponsorship deals with Lawrence and other celebrities were helpful in eliminating the taboos that surround cryptocurrencies.
When the deal with Blockfolio was made, Lawrence had said that he had wanted a long-term partner for his crypto portfolio, one who could be trusted.
The athlete did not comment about the settlement or about the report.
A renowned YouTube influencer, Nash has about 289,000 subscribers and a first-class action complaint filed against him disclosed that he had also endorsed FTX in exchange for payment.
The Moskowitz Law Firm had filed the lawsuit against Nash and other influencers back in March.
According to the complaint, Nash and other influencers had removed any content touting FTX and its founder, Sam Bankman-Fried, from their channels after the exchange’s collapse.
An Australian citizen, Nash had not responded to the lawsuit initially and this had prompted the law firm to ask a federal judge to permit them to serve the said lawsuit via a tweet.
Another influencer, Paffrath’s YouTube channel called ‘Meet Kevin’ has about 1.88 million subscribers and he acknowledged being sponsored by FTX in a video posted on November 17th, 2022.
He had stated that it was a ‘scar’ that he now regrets. On March 16th, he posted another video, a day after his name had been listed in the class-action lawsuit filed by Moskowitz.
In the said video, he blamed SBF for the fiasco and said it was ‘ludicrous’ to suggest that influencers had contributed to the fraud.
These are only three of the long list of celebrities who had worked with FTX before the exchange’s downfall.
Some of the others who are now facing legal action due to their partnerships with the crypto exchange include tennis player Naomi Osaka, former NBA player Shaquille O’Neill, and NFL quarterback Tom Brady and Gisele Bundchen, his ex-wife.
This settlement news came after a cyberattack targeted FTX, which shut down its online portal that had been created to assist former clients in making reimbursement claims.
Meanwhile, FTX has received authorization from a federal judge to start selling its crypto assets worth $3.4 billion, which include Solana, Bitcoin, and Ethereum, as part of the bankruptcy process.