Cristiano Ronaldo, the renowned football icon, has become the subject of a class-action lawsuit filed by the same two plaintiffs who previously sued Changpeng Zhao (CZ), the former CEO of Binance, for $1 billion. The Ronaldo suit, which also seeks a staggering $1 billion in damages, may raise questions, particularly given the striking similarities to the earlier case against CZ. A Summons has been issued to Ronaldo by the appointed judge.
History of crypto class-actions by plaintiffs.
The plaintiffs’ lawsuit against CZ was terminated in August and appears to have proceeded to arbitration, although the final details are unclear. Notably, the third plaintiff in each class action suit differed, but Boies Schiller Flexner and The Moskowitz Law Firm represented the plaintiffs in both cases. The backgrounds of the two plaintiffs, who have names common throughout the United States and Florida, where both suits were filed, are unknown to CryptoSlate.
The Moskowitz Law Firm has a notable history of involvement in similar high-profile cases involving celebrity endorsements. The firm was involved in a lawsuit against basketball legend Shaquille O’Neal over his NFT project, Astrals. The case accused O’Neal of violating securities laws concerning offering Solana-based assets and an associated token. The firm also took on Mark Cuban in a class action litigation relating to Voyager Digital Ltd. The case revolved around allegations of insider trading, with the firm representing the plaintiffs’ side.
Moskowitz, along with Boies Schiller Flexner, has also been actively involved in various lawsuits related to the collapse of FTX. These cases included actions against celebrity backers and endorsers like Tom Brady, Gisele Bundchen, Shaquille O’Neal, and Larry David, among others.
On Dec. 7, 2022, Boies Schiller Flexner filed a class action complaint in the case of Gregg Podalsky and others against Sam Bankman-Fried and various associates. Filed at the U.S. District Court for the Southern District of Florida, this lawsuit reflects the firm’s role in addressing the legal fallout from one of the most significant events in the crypto world.
In another case related to the FTX collapse, Boies Schiller Flexner filed an amended complaint on Dec. 5, 2022, representing plaintiffs Michael Norris and others against Tom Brady, Kevin O’Leary, and David Ortiz, among others.
This track record of engaging in lawsuits that blend celebrity involvement with the emerging legalities of crypto offers a crucial backdrop for understanding the firms’ current legal action against Cristiano Ronaldo. It appears to paint a picture of a legal practices adept at navigating the intersection of high-profile personalities and the evolving landscape of digital finance, often in cases that draw significant media attention and involve substantial financial stakes.
Similarities in celebrity endorsement cases in crypto.
Interestingly, a detailed comparison of the lawsuits against Ronaldo and CZ reveals a high degree of similarity, with much of the content in the Ronaldo suit mirroring that of the CZ. Further, exact matches in specific sections were manually identified by CryptoSlate, suggesting a templated approach to legal drafting.
Notably, both lawsuits revolve around allegations of “unregistered securities” and regulatory non-compliance within the crypto industry, a sector currently under intense scrutiny. The lawsuits employ similar language and structure, focusing on similar legal arguments and allegations. However, given the complexity of the cases, it is not uncommon for the legal language articulating similar theories to be alike or even identical. This often ensures that the legal arguments are presented consistently.
However, given that in the case against CZ, influencers Graham Stephan and Ben Armstrong were initially implicated but were later removed from the suit and not pursued further, questions may arise as to how these same arguments apply differently to Ronaldo.
Ultimately, the suits rely on the premise that the plaintiffs “purchased, repurchased, invested, and/or reinvested unregistered securities from Binance.”
Further, the suits state,
“Plaintiff [removed] did so after being exposed to some or all of Defendant’s misrepresentations and omissions regarding the Binance platforms as detailed in this complaint, and executed trades on the Binance platforms after those misrepresentations and omissions were made.”
There has yet to be any precedent set that Binance engaged in the sale of unregistered securities as the case against it, brought by the SEC, is still underway. Binance has been reported to be settling criminal charges by the DOJ for $4 billion, while the SEC case has not disclosed any potential fines or remedies to date.
When reviewing legal filings, it is crucial to maintain a balanced perspective, acknowledging the legal intricacies and broader implications within the crypto industry. It is also important not to avoid highlighting the patterns that emerge from these lawsuits.
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