TL;DR
- Shaquille O’Neal has agreed to settle an $11 million class action lawsuit over promoting Solana-based Astrals NFTs, covering legal fees and compensating investors.
- The lawsuit accused O’Neal of promoting unregistered securities through Astrals NFTs, using his celebrity status to market the digital assets.
- The settlement highlights the increasing legal scrutiny of celebrities endorsing cryptocurrency projects, with significant implications for both celebrities and investors.
NBA legend Shaquille O’Neal has agreed to settle an $11 million class action lawsuit involving the promotion of Solana-based Astrals NFTs. The settlement, which is pending court approval, aims to cover legal fees and provide compensation to investors who purchased Astrals NFTs and Galaxy tokens. This marks a significant development in the ongoing legal scrutiny of celebrities endorsing cryptocurrency projects.
The Case Against O’Neal and Astrals
The lawsuit, filed in May 2023, accused O’Neal of promoting unregistered securities through the Astrals NFT project. The plaintiffs alleged that O’Neal used his celebrity status to market the collection of 10,000 “metaverse-ready” 3D avatars and the associated Galaxy tokens.
The promotion was reportedly conducted under his DJ alias “DJ Diesel” at various high-profile events and live performances. The plaintiffs argued that these digital assets were marketed as unregistered securities, violating U.S. laws.
Legal Proceedings and Settlement
Throughout the legal proceedings, O’Neal and his legal team attempted to have the case dismissed multiple times. However, in August 2024, a federal judge allowed the plaintiffs to proceed with the litigation. By November, both parties had agreed to settle the case.
The $11 million settlement is expected to cover legal fees and provide compensation to all investors who bought Astrals NFTs and Galaxy tokens.
Financial Strain on Astrals
The legal battle has taken a toll on Astrals, with the company admitting to significant financial strain due to unexpected legal expenses and a prolonged court battle. In a private message on Discord, Astrals disclosed the financial difficulties it faced, highlighting the impact of the lawsuit on its operations.
Celebrities and Crypto: A Growing Trend
O’Neal is not the first celebrity to face legal challenges over promoting cryptocurrency projects. In 2022, Kim Kardashian settled charges with the U.S. SEC for promoting EthereumMax, paying $1.3 million.
Similarly, NFL star Tom Brady and comedian Larry David are currently facing lawsuits related to the now-bankrupt crypto exchange FTX. The settlement of the $11 million class action lawsuit against Shaquille O’Neal underscores the increasing legal scrutiny of celebrities endorsing cryptocurrency projects.
As the crypto market continues to evolve, the involvement of high-profile figures in promoting digital assets will likely remain a contentious issue, with significant implications for both the celebrities and the investors involved.
