Late last month, Judge Roy Altman of the US District Court for the Southern District of Florida dismissed a class action cryptocurrency lawsuit filed in 2022 against the Dallas Mavericks and former majority owner Mark Cuban.
Altman stated in an order that the plaintiffs failed to establish personal jurisdiction over the team and the billionaire. The lawsuit claimed that Cuban and the Dallas Mavericks defrauded investors by promoting the now-bankrupt cryptocurrency lender Voyager Digital.
The lawsuit alleged that Cuban induced the plaintiffs to open interest-bearing accounts with Voyager Digital when he said during a Mavericks news conference in October 2021 that he had personally invested in the company. The Mavericks later posted on social media that customers who downloaded the app, opened an account, deposited $100 (£73.86), and made a single trade would receive $100 in free Bitcoin.
Former NFL tight end Rob Gronkowski, former NBA player Victor Oladipo, and NASCAR driver Landon Cassill were previously named as defendants in the lawsuit but have since settled. The case was among several filed against athletes and celebrities who promoted now-bankrupt cryptocurrency platforms.
Cuban’s attorneys had argued that the Shark Tank star cautioned people to be careful with their money. He even stated that the Voyager assets in question were not classified as securities and were not subject to regulations related to promotional activity. Attorneys also highlighted that the court where the case was lodged had no jurisdiction over Cuban and the Mavericks. Cuban has since sold his majority stake in the Mavericks to Miriam Adelson.
‘The complaint asserted claims under various state securities laws and consumer fraud statutes,’ Cuban and the Mavericks’ legal team at Brown Rudnick stated. ‘On December 30, the US District Court for the Southern District of Florida Judge Roy K. Altman dismissed the matter in its entirety.’
‘We couldn’t be more pleased with the absolute right result,’ said Steve Best, lead counsel for Cuban. ‘I suspect that the plaintiffs will consider filing in another jurisdiction. I look forward to defending Mark and the Mavericks in any jurisdiction in this country. Mark doesn’t settle when he believes he is on the right side of the law.’ Best added that the plaintiffs have no recourse to refiling in the USDC-SDFL.
The lawsuit alleged that Cuban misrepresented Voyager prior to the company filing for Chapter 11 bankruptcy protection in 2022.
During that time, Voyager had around $1.3 billion (£960.1 million) of crypto assets on its platform. The company’s downfall was part of a broader market downturn that could be attributed to the collapse of the Terra blockchain, which wiped out nearly $40 billion (£29.5 billion) in market value and ultimately led to founder Do Kwon receiving a 15-year prison sentence in December.
Kwon was charged with fraud and eventually pleaded guilty. His activities led to losses greater than the combined FTX and OneCoin collapse.
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