Kim Kardashian, Floyd Mayweather, and other well-known celebrities are attempting to persuade a court to dismiss the lawsuit that seeks to hold them accountable for allegedly endorsing EthereumMax (EMAX).
The celebrities requested that a federal court in California reject a second amended case from EthereumMax investors that was submitted in December. The defendants contend that the additional claims advance the “same core notion” that the court previously rejected.
The EthereumMax team collaborated with the celebrities to sell EMAX tokens to investors in what they refer to as a “pump-and-dump” scam, according to the investors’ class action complaint.
The idea that celebrities would promote EMAX tokens to artificially inflate their price was already rejected by the court, according to the defendant’s request to dismiss the second lawsuit, since the tokens have no intrinsic worth beyond what the market is willing to pay for them. They wrote:
“The Court otherwise dismissed the prior complaint in full due to fundamental flaws. The addition of new claims, Defendants, and over 100 pages of largely irrelevant allegations does not cure the defects.”
The petition also implies that the investors’ new hypothesis is that they held onto EMAX because of false statements made by celebrities. But the investors “suffered no damage from just holding onto the tokens,” the petition to dismiss contends.
In the meanwhile, Kim Kardashian has already paid a fee as a result of social media advertisements for EthereumMax. The American socialite and the Securities and Exchange Commission (SEC) agreed to a $1.26 million settlement on October 3 after she failed to disclose that she had been paid $250,000 to promote the cryptocurrency project.
The SEC just issued a warning to celebrities who advocate cryptocurrency, in the meanwhile. The SEC reminded celebrities on February 17 that the law requires them to declare their compensation and the source of it when endorsing the purchase of securities.
