Adidas along with celebrities including Steph Curry, Madonna and Snoop Dogg were named in a potential class action lawsuit for promotion of NFTs and cryptocurrencies from the creators of the once-popular Bored Ape Yacht Club.
Defendant Yuga Labs is being sued by a group of investors who bought Yuga’s NFTs that lost 90% of their value over the last 20 months. Alongside Adidas, the suit also names celebrities who promoted the lab’s digital assets, including NBA star Steph Curry, singer Abel Tesfaye — better known as The Weeknd — and tennis star Serena Williams.
The Bored Ape Yacht Club was part of the first mainstream boom of NFTs and crypto last year, and included 10,000 cartoon ape NFTs that garnered wide celebrity attention. When it launched in 2021, each asset cost about $220, but as the collection grew, the floor price climbed to over $100,000 per NFT by October.
Yuga Labs was valued at $4 billion in March after a $450 million seed round. A spokesperson for the group said the claims in the suit are “opportunistic and parasitic.”
“We strongly believe that they are without merit, and look forward to proving as much,” the spokesperson said.
In documents filed Dec. 8 in the U.S. District Court for the Central District of California, representatives for the proposed class said that Yuga used celebrities and companies like Adidas to “misleadingly promote” the collection to “artificially increase” interest in it.
“Adidas … acted as an agent and direct or indirect spokesman for (Yuga Labs) by virtue of its capital investment in (it), and directed and/or authorized … the solicitations of Yuga securities to the public,” the suit said.
The suit is seeking class certification as well as more than $5 million in damages. Adidas did not immediately reply to the Business Journal’s request for comment.
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