By
Chimamanda U. Martha
April 25th, 2024
The NBA star’s involvement in Binance’s marketing campaign drew significant attention, considering his status as a prominent figure in professional basketball.
The Miami Heat’s star basketball player Jimmy Butler is taking legal action to dismiss his involvement in a class-action lawsuit against celebrities employed by Binance, the world’s largest cryptocurrency exchange, to promote its product offerings. The case, which amounts to a staggering $1 billion, was filed in April by The Moskowitz Law Firm and Boies Schiller Flexner. Binance is accused of engaging in deceptive practices by enlisting celebrities and influencers, including Butler, to promote unregistered securities, specifically referring to BNB.
On July 24, Butler’s legal team filed a motion to clear him from the lawsuit. According to the court filing, the three tweets the basketball star shared promoting the exchange between February 2 and February 13, 2022, did not endorse any unregistered securities contrary to the claims made in the lawsuit. Instead, the tweets were focused on encouraging potential investors to conduct thorough research before engaging in cryptocurrencies.
Butler Named Alongside Binance and Its CEO in the Lawsuit
In one of the promotional videos shared by Binance on Twitter before the 2022 Super Bowl, Butler emphasized the importance of conducting thorough research and trusting oneself before venturing into the digital asset market. He also warned viewers that influential figures in the industry might not be aware of individual investors’ financial circumstances, advising them to exercise caution.
Trust yourself.
02.13.22
Here’s a message from all-star basketball forward @JimmyButler ⤵️ pic.twitter.com/WS9XCQrlhO
— Binance (@binance) February 2, 2022
However, in the lawsuit, amended on June 27, Butler’s tweets were accused of being deceptive as they coincided with the promotion of free Binance non-fungible tokens (NFTs).
The NBA star’s involvement in Binance’s marketing campaign drew significant attention, considering his status as a prominent figure in professional basketball. However, he is not the only defendant in the lawsuit. Binance, along with its CEO Changpeng Zhao (CZ) and popular YouTubers Graham Stephan and Ben Armstrong, also known as BitBoy Crypto, were named in the class action suit.
Butler, Zhao, Binance, and Armstrong have also filed separate motions to dismiss the lawsuit. Notably, on June 15, YouTuber Stephan was removed from the suit.
Potential Impact of the Case on Celebrity Endorsements
The case has raised questions about the responsibilities of influential figures in cryptocurrency, mainly due to the lack of specific regulations governing crypto-related promotions in the United States.
The outcome of Butler’s motion to dismiss could have significant implications for future celebrity endorsements in the digital asset industry. The case may prompt a reevaluation of advertising practices and the need to provide clearer guidelines to safeguard consumers from misleading information.
In a similar incident last year, the US Securities and Exchange Commission (SEC) fined Kim Kardashian $1.26 million for promoting a crypto project called EthereumMax (EMAX).
The billionaire socialite and other celebrities, including Floyd Mayweather, faced a class action lawsuit from investors who claimed they were misled by the endorsements, leading to significant losses. The suit alleged that these influencers engaged in a pump-and-dump scheme. The case was later dismissed by a US court in December 2022.