Mark Cuban Sued for Promoting Voyager Digital
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As the crypto space continues to crash and burn, many lawsuits from disgruntled investors who have likely lost thousands or even millions of dollars in recent months have started to pile up. One of the latest lawsuits to come to light involves Mark Cuban, billionaire investor and crypto bull, and the Dallas Mavericks basketball team he owns.
Mark Cuban may face a lawsuit
The team and Cuban are being sued for promoting Voyager Digital, a crypto company that recently filed for bankruptcy and caught fire. Voyager is just one of many companies that have filed for Chapter 11 bankruptcy to protect themselves from crypto investors who are taking the heat from the many crashes that have occurred in recent weeks. Other companies using similar protocols include crypto hedge fund Three Arrows Capital.
The class-action lawsuit against Cuban has been filed against some 3.5 million investors, all of whom have lost up to $5 billion in Voyager Digital investments. The company’s CEO, Stephen Ehrlich, was also named as a defendant in the lawsuit.
Shane Seppinni – founder of Seppinni LLP – is an attorney who has been involved in several previous crypto-based lawsuits. He offered his thoughts on the situation in a recent conversation, claiming:
During the rise in crypto prices, many web3 companies, including Voyager, pretended that current laws and regulations did not apply to crypto. Even smart people like Mark Cuban got caught up in the hype, but now that crypto prices have crashed, it’s clear that centuries-old legal theories like fraud, breach of fiduciary duty, and civil conspiracy are as applicable to crypto as they come. elsewhere.
Were investors coerced?
While this is not meant to defend Cuban or anyone else mentioned in similar documents, it will likely be difficult to fully pull this off in court because no one forced the people who filed the suit to invest in the company at issue. It’s not like someone puts a gun to their head and says, “Put down or I’ll shoot.” The Dallas Mavericks and Mark Cuban likely had contracts with Voyager Digital, and those contracts stipulated promotional terms that all would be required to adhere to.
From there, investors had the option of either putting their money into Voyager Digital or avoiding the company altogether. At the end of the day, investors made their own choices, and if something didn’t go well, that’s part of the game. Crypto can be very up and down; it’s hard to predict what’s going to happen in the space, which is why so many cryptoheads are urging traders to be cautious.