Investors involved in a class-action lawsuit against celebrities accused of promoting the now-defunct cryptocurrency EthereumMax (EMAX) have been granted a final opportunity to amend their charges.
U.S. District Court Judge Michael Fitzgerald issued a court order on October 3rd, stating that EMAX investors would be given a third and ultimate chance to submit an amended complaint.
This class-action lawsuit was initiated in 2022, targeting celebrities such as boxer Floyd Mayweather, NBA star Paul Pierce, and reality TV personality Kim Kardashian, among others. The lawsuit alleges that these celebrities promoted EMAX as part of what it describes as a "pump and dump" scheme.
While the lawsuit was initially dismissed in 2022, it was refiled in June, with the plaintiffs' claims related to "unfair competition" against the celebrities remaining intact. The recent court order addresses several motions.
Mayweather's motion to dismiss the state consumer law claim was denied by the court, citing sufficient allegations of materiality and Mayweather's failure to disclose his status as a paid promoter.
Pierce's motions to dismiss state consumer law and manipulation claims were also denied, with the court finding enough evidence to support the accusation that Pierce or his representatives engaged in the sale and trade of tokens for personal gain.
A motion to dismiss similar consumer claims against Giovanni Perone, one of EMAX's co-founders, was rejected by the court. However, the court granted a modified dismissal of the securities claims, noting a failure to allege that Perone personally sold the tokens.
Judge Fitzgerald emphasized that the plaintiffs must resubmit the lawsuit, and the defendants must address the remaining claims. He noted that the plaintiffs had repeatedly failed to address identified deficiencies and had been explicitly warned that this would be their last chance to amend their complaint.
