Yuga Labs the parent company of the famous monkey-faced NFTs, Bored Ape Yacht Club aka BAYC, is being sued for using celebrities to promote their digital products.
-During the NFT frenzy of 2021-2022, celebrities were increasingly showing of their PFP and promoting various NFTs on Instagram and Twitter
-PFP: picture for proof. A way of displaying ownership of a rare digital piece of art.
- Yuga Labs is facing a class action lawsuit against celebrities promoting its NFTs.
- This lawsuit involves Snoop Dogg, Madonna, Kevin Hart, Jimmy Fallon, Stephen Curry, Justin Bieber, Gwyneth Paltrow, Lil Baby, Paris Hilton and others as defendants.
- These famous individuals are increasingly facing backlash on twitter for non-disclosure of the type of relationship they had with Yuga Labs when promoting their NFTs.
The lawsuit was filed Dec. 8 in California and includes at least 37 co-defendants, primary one being Yuga Labs executives, celebrities and MoonPay, which allegedly facilitated the endorsements. The filing claims that Yuga Labs secretly paid celebrities through MoonPay to support the Bored Ape NFT.
At the heart of this claim is Madonna's representative and talent manager, Guy Oseary. The 100-page lawsuit alleges that he encouraged his network of celebrities to endorse NFTs while offering financial retributions for their endorsements. The talent manager was an early investor in MoonPay, facilitator of the payments to promoters. Interestingly, like most NFTs, Justin Bieber's Bored Ape #3001 NFT has lost 94% in USD value since its purchase in January 2022.
MoonPay, a global payment solution based on crypto, worth $3.2 billion, is known since 2021 for its exclusive NFT acquisition service for celebrities. The lawsuit insists on the fact that MoonPay was just a front, a facilitating interface between Yuga Labs and the celebs. In the meantime, Yuga Labs denied the claims in the lawsuit, saying these are "opportunistic and parasitic".
The unique selling point of Yuga Labs' line of NFTs called Bored Ape Yacht Club is that the monkey-NFT owners have the right to membership to an exclusive "club" that includes celebrities.
Plus, the lawsuit adds that the “exclusive” aspect was a "completely fabricated" by Hollywood talent agent Guy Oseary, YugaLabs executives and front-office operator "MoonPay" to promote and sell the digital property. The latter is in reality a crypto platform that facilitates the buying and selling of cryptocurrencies, an exchange which is mentioned in the lawsuit as a white glove service designed to help the super rich and famous buy NFTs "without all the hassle of setting up a wallet, buying crypto, using that crypto to purchase an NFT, and then taking custody of it".
Unsurprisingly, executives of Yuga and Oseary jointly arranged a plan to leverage their extensive networks of musicians, athletes, celebrity clients and high-profile partners to deceptively promote and sell Yuga's financial products according to the court document. Consisting of over 10,000 NFTs depicting cartoon monkeys in various costumes, Bored Ape is one of the most successful NFT art collections, valued at over $1 billion.
We recall that this is the second lawsuit filed by the law firm Scott+Scott against Yuga Labs. In July, the law firm announced a class action lawsuit against the latter, alleging that they sold and promoted Bored Apes and ApeCoin in total violation of securities laws.
Yuga Labs is also under investigation by the United States Securities and Exchange Commission over a possible security breach. Celebrity endorsers are facing a growing number of lawsuits for promoting cryptocurrency-related products and non disclosure of consequent compensations. To add fuel to the flames, the celebrities who represented the bankrupt cryptocurrency exchange FTX were recently embroiled in a class action lawsuit. This is symptomatic of a crypto winter, somnolent months in the crypto sphere where the most interesting events are fear, lawsuits, uncertainty and doubts about projects who were deemed as shining stars months before; we can comfortably question the strength of its native token ApeCoin, how valuable is the coin and how appropriate it is to hold Apecoins in your portfolio...