A class-action suit has been brought against Kim KardashianKimberly (Kim) Noel Kardashian WestInvestors sue Kim Kardashian, Floyd Mayweather over cryptocurrency promotion Victim's brother rips Colorado governor for reducing trucker's 110-year sentence 2021's top political celebrity moments MORE and boxer Floyd Mayweather over allegations that they misled investors when they promoted a cryptocurrency on social media.
The suit was filed Friday by Ryan Huegerich and other investors who bought cryptocurrency EthereumMax in the late spring of 2021. The lawsuit alleges that EthereumMax and its promoters made “false or misleading statements” to artificially inflate the cryptocurrency, according to CNBC.
The plaintiffs also allege they suffered losses due to the celebrities' promotion of the cryptocurrency.
Kardashian posted about the cryptocurrency on Instagram last year and included the hashtag "ad" in her caption. It is unclear at this point if she was paid by the cryptocurrency for the post. CNBC estimates that Kardashian's fee for an Instagram promotion runs anywhere from $500,000 to $1 million.
“Are you guys into crypto????” the reality star and businesswoman wrote, according to the news outlet. “This is not financial advice but sharing what my friends just told me about the Ethereum Max token!”
Mayweather also endorsed the cryptocurrency during his boxing match with YouTube star Logan Paul, where EthereumMax was accepted as payment for the event, CNBC reported.
In addition, the professional boxer promoted EthereumMax at a major bitcoin conference in Miami. However, Mayweather was booed off the stage, according to the news outlet.
Some investors have alleged that EthereumMax was a "pump and dump" scheme, where scammers use false or misleading statements to boost the price of a cheap stock.
The lawsuit said that EthereumMax “has no connection” to the second-largest cryptocurrency ether. It added that its branding seems to be an effort to mislead investors into believing the token is part of the Ethereum network. EthereumMax has lost about 97 percent of its value since June.