Photo by Markus Spiske on Unsplash
The NBA Is Caught in a $4.2 Billion Crypto Scandal
February 9, 2024
In an escalating legal situation, the National Basketball Association (NBA) is currently facing litigation for its alleged role in endorsing Voyager Digital Holdings, a now-defunct cryptocurrency exchange business. The complainants have asserted that the NBA’s promotional activities resulted in significant investor losses, purportedly over $4.2 billion.
Central to the controversy is the marketing agreement that was executed between Voyager and the Dallas Mavericks, an NBA franchise. The NBA is implicated as a responsible party due to its approval of this arrangement, with the contention that it acted in a negligently indiscriminate manner. As a result, the litigants posit that the NBA should bear liability for all damages attributable to its promotion of Voyager’s unregistered securities.
Moreover, the lawsuit implicates McCarter & English, the law firm representing Voyager. The contention against the law firm is that it leveraged its professional reputation to provide assurance to investors about the legality and propriety of Voyager’s offerings.
In addition to the NBA and McCarter & English, Mark Cuban, former owner of the Dallas Mavericks, was previously subjected to a similar lawsuit in 2022. The litigants in that case alleged that Cuban made misleading representations about Voyager. Cuban refuted these claims.
In the background of these legal actions is Voyager’s financial insolvency. In July 2022, Voyager initiated bankruptcy proceedings, primarily due to ill-fated involvement with Three Arrows Capital, a failed cryptocurrency hedge fund. The legal and financial complications surrounding Voyager, and their resulting repercussions, constitute an emblematic instance of the inherent risks and volatility in the global cryptocurrency market.
The NBA’s endorsement, McCarter & English’s assurances, and Mark Cuban’s alleged misrepresentations are subjects of legal scrutiny due to the collapse of Voyager. The evolving circumstances underline the significance of exhaustive due diligence in financial engagements, particularly when dealing with ventures in the notoriously unpredictable cryptocurrency domain.
Recent News
Qantas Pays $79M To Settle ‘Ghost Flights’ Case
Qantas is paying the biggest fine of its history to settle the reputational crisis.
Rue21 Files for Bankruptcy, 540 Stores To Close
Rue21 is the latest brick-and-mortar clothing retailer to file for bankruptcy.
Google’s Antitrust Trial Teeters On
Google’s landmark antitrust case against the Justice Department has reached its final stage, sparking concern across Silicon Valley. Prosecutors argue that Google’s dominance in online search and search advertising markets is illegal, while Google maintains its superiority. The outcome, to be decided by US District Judge Amit Mehta, could have significant implications not only for Google but also for other tech giants like Apple, Amazon, and Meta.
Virgin Galactic’s Unity Spacecraft Nears Final Flight
Virgin Galactic has announced that its Unity spacecraft is set to embark on its last commercial journey, marking a significant milestone for the company. The Galactic 07 mission, scheduled for June 8, will be the 12th and final flight of the Unity spacecraft before Virgin Galactic shifts its focus to its new Delta-class spacecraft.