Football superstar, Cristiano Ronaldo, faced a setback in court when his motion to dismiss a $1 billion class-action lawsuit was denied by Judge Roy Altman on May 4. The lawsuit revolves around Ronaldo’s promotion of non-fungible tokens (NFTs) on the Binance platform. The judge directed the case to be stayed until pending motions in a related action are adjudicated. Arbitration, a form of private dispute resolution, will be used to resolve the case.
Ronaldo launched an NFT collection called “CR7” in collaboration with Binance, featuring digital collectibles of himself and memorable moments from his sports career. The collection, representing Ronaldo’s initials and shirt number, was marketed as symbolizing innovation, artistry, and fan engagement. Prosecutors alleged that Ronaldo’s promotion of these NFTs was deceptive and unlawful, leading investors to make costly and unsafe investment decisions. The popularity of Ethereum-based NFTs has declined since early 2022, with drops in minting and trading volume alongside floor prices.
Ronaldo’s promotional activities for Binance included posts on his Instagram account, such as playing foosball with another sponsored athlete. In one post, Ronaldo mentioned meeting and training with holders of his rarest NFTs, thanks to his ForeverCR7 collection. Plaintiffs in the November lawsuit claimed that Binance’s success was built on fraud and the sale of unregistered securities, bolstered by celebrities like Ronaldo. Binance is currently involved in legal battles with U.S. regulators over whether NFTs and tokens on its platform qualify as investment contracts under U.S. securities law.
Plaintiffs argued that Ronaldo’s promotional efforts significantly boosted interest in Binance, with Google searches for the platform increasing by 500% after his partnership announcement. The premium NFTs associated with Ronaldo’s collection quickly sold out within a week of launch. The lawsuit aims to hold Ronaldo accountable for his role in promoting what plaintiffs allege to be fraudulent activities on the Binance platform, contributing to investors making uninformed and risky investment decisions based on the marketing of NFTs. The denial of Ronaldo’s motion to dismiss signifies that the case will proceed, and arbitration will be utilized to resolve the legal dispute.
In conclusion, the $1 billion class-action lawsuit against Cristiano Ronaldo highlights the complexities and potential legal risks associated with celebrity endorsements of cryptocurrency and NFTs. The outcome of this case could have broader implications for how such endorsements are regulated and scrutinized in the future. As the legal proceedings continue, it remains to be seen how the court will ultimately rule on the allegations against Ronaldo and his involvement in the promotion of NFTs on the Binance platform. Stay tuned for further developments in this high-profile case that could reshape the landscape of celebrity-driven cryptocurrency promotions.
