The fallout from the FTX scandal continues. For sports, the news seems to be an endless rabbit hole. It appears people swindled out of funds by FTX crypto-exchange now want to hold NBA basketball teams accountable for their loss. Starting with the Golden State Warriors, victims of Sam Bankman-Fried are now suing sports organizations for promoting his exchange as ‘safe.’
Golden State Warriors Fighting Cases
The first team in court is located in the Bay Area of California. And they likely will not be the last from the Silicon Valley region.
Stephen Curry’-led ‘s Golden State Warriors were sued by a single individual, fighting for the masses. He or she accuses the team of fraudulently promoting the now bankrupt exchange.
Elliott Liam is the name of the claimant. A citizen of Canada living in Hong Kong, he filed a proposed class-action lawsuit in San Francisco federal court. The Canadian-born crypto investor believes thousands if not millions of people will join in on the class-action case.
This case stems from the Warriors promoting the FTX crypto-exchange in December 2021. The iconic sports team described the digital currency trading platform as a “viable and safe way to invest in crypto.” Unfortunately, less than 1 year later that statement has proven untrue.
Liam says the specific language used in the Warriors’ promotion of FTX was deliberate and used to lure people into investing.
The class-action seeks damages under the California consumer laws for customers outside the US.
Liam claims he lost the $750,000 he had in his FTX account.
And This is the second FTX-related case against the Warriors as an organization . They are also defending against a November 16th lawsuit in Miami, Florida. A US citizen is seeking damages from Stephen Curry for endorsing the bankrupt exchange.
Klay Thompson and Andre Igoudala also took 1 year of salary in Bitcoin 1 season ago. However, their business was done with CashApp. Fortunately for them, there has been no wrong doings on the behalf of the digital banking service. The only loss they have to worry about is those that have come from the falling of Bitcoins’ price in relation to FOMO caused by FTXs collapse. It’s estimated, if still holding bitcoin, they’ve lost up to $21-million dollars collectively.
Miami Heat Burned NBA Fans
If this lawsuit builds steam, there are other NBA teams and celebrities that should be worried.
The Miami Heat named their home stadium, “FTX Arena.”
It’s not clear what marketing campaigns, if any, have been launched in association to the arena branding. However, it’s easily known that millions of people were introduced to the FTX name brand through Miami Heat basketball games.
The Heat do not own the FTX arena however. Therefore they may be clear of wrong-doing.
The city of Miami-Dade actually owns the stadium. The ‘Wade County’ government cannot change the arena name currently due to FTXs bankruptcy filing. A judge issued a ‘stay’ order on all business related to the disgraced exchange.
The Miami Heat only received $2-million dollars annually from the deal.
WNBA Got Next? Lakers, Clippers, Sparks
Los Angeles Lakers, Sparks, and Clippers are living on a prayer. If the crypto market crashes, they could receive a serious ‘back-lash’ as their sports venue is called the “Crypto.com arena.”
And there’s been speculation around this crypto-exchange since FTX’s collapse. However, thus far, things have been smooth enough to avoid a collapse.
If Crypto.com goes out of business, AEG and the 3 LA basketball organizations stand to lose all benefits associated with their $700-million-dollar deal. A record breaking deal, this was the largest arena branding contract in NBA history.
Other Potential NBA Related Cases
If this rabbit hole is opened it can go long and deep. Michael Jordan, Lonzo Ball, the Sacramento Kings, Kevin Durant, and Lebron James all have ties to crypto products.
However, as long as the crypto market does not crash nor other exchanges turn out to be a fraud, all should be fine. Market volatility is not the same as what has happened with the fallout of FTX.