Socios has filed a lawsuit against the Argentine Football Association (AFA) for terminating a sponsorship agreement with it and signing a new one with Binance cryptocurrency exchange.
According to the official document seen by CoinDesk, fan token site Socios has filed a lawsuit with an Argentinian national commercial court led by judge Mara José Gigy Traynor, who granted a prohibitory injunction forcing AFA to acknowledge the three contracts inked with Socios.
Details and reasons for the Lawsuit
The AFA acknowledged the order but told CoinDesk that it is just temporary and that it will be appealed.
AFA must “refrain from taking any action, proceeding, or taking any step that would impede the enjoyment of exclusive rights” by Socios, according to the injunction.
The legal measures began only days after the AFA announced that it had secured a five-year sponsorship partnership with Binance to support its national teams and professional soccer league. The agreement includes the creation of a fan token, which will be offered to the market “shortly,” according to the crypto exchange.
The AFA cancelled a similar bundle of three contracts it signed with Socios in 2021, including the launch and management of the national team cryptocurrency, $ARG, three weeks ago, according to both sides.
Socios allegedly defaulted on a payment four months ago, according to the AFA, which did not disclose the specific amount. Socios was sent with multiple notices but did not pay, according to the AFA.
The AFA also claimed that Socios did not do enough to promote the Argentina token, which debuted in August at $4.32 and is currently trading at $1.18. In addition, the AFA stated that Socios had committed “many breaches” in the usage of the national team’s and professional soccer league’s images, without providing further details.
Socios told CoinDesk that it had made all of the necessary payments to the AFA and that it owed the organization nothing. The token price does not exist in any provision as a valid basis to cancel the contract, according to the business, which also claims that “there has been no misuse of the AFA’s image.”
The AFA announced that it has begun its own legal action against Socios, alleging contract non-performance.
The AFA and Binance
According to a source familiar with the deal, the AFA received a greater financial offer from Binance and attempted to compel Socios to match it, which the firm refused to do because a contract was already in place. That charge was refuted by the AFA.
The AFA further denied that it had cancelled its partnership with Socios in order to make room for Binance, and that Binance had always been aware of AFA’s existence. “Binance had shown interest in AFA for several years, long before Socios,” a spokeswoman for the company told CoinDesk.
Socios and Bybit
In the meantime, the AFA has cancelled a two-year deal it had inked in November with Singapore-based cryptocurrency exchange Bybit to be the principal global sponsor of its national teams.
The contract featured a 90-day trial phase, after which both parties would sign a formal two-year contract, according to the AFA. According to AFA, the cancellation occurred within the interim period.
“While we seek further information to identify the appropriate course of action at this time, Bybit will investigate all possibilities to protect our interests.” “Igneus Terrenus, head of communications at Bybit, told CoinDesk that the case would be settled amicably, and we look forward to attaining a fair and just resolution.”
