Billionaire investor and Dallas Mavericks owner Mark Cuban has been named as a defendant in a class action lawsuit in connection with promoting now-bankrupt crypto brokerage Voyager Digital Ltd VYGVQ.
What Happened: A complaint filed Aug. 10 with the United States District Court in Southern Florida alleges that Cuban and Voyager Digital CEO Stephen Ehrlich misrepresented Voyager’s crypto products.
The lawsuit alleges the two “went to great lengths to use their experience as investors to dupe millions of Americans into investing—in many cases, their life savings—into the Deceptive Voyager Platform and purchasing Voyager Earn Program Accounts ('EPAs'), which are unregistered securities.”
A Dallas Mavericks spokeswoman and a Voyager Digital spokesman both declined to comment on the lawsuit.
Voyager filed for Chapter 11 bankruptcy on July 6 after insolvent crypto hedge fund Three Arrows Capital (3AC) defaulted on a loan repayment. The lawsuit estimates that Voyager’s bankruptcy led to over 3.5 million Americans losing over $5 billion dollars.
“This action seeks to hold Ehrlich, Cuban, and his Dallas Mavericks responsible for paying them back,” stated the plaintiffs.
The complaint went on to note that Cuban had referred to Voyager as a platform that was “as close to risk-free as you’re going to get in the crypto universe.”
“Put simply, Mark Cuban is no more qualified to provide digital asset investment advice than most laypeople … Mark Cuban may know some things about finance and business, but he is in no way, shape, or form deeply experienced with blockchain technology,” alleged the complaint.
Price Action: At press time, Voyager Token VGX/USD was trading at $0.33, down 1.32% over the last 24 hours.
Disclosure: Benzinga CEO Jason Raznick Is a member of the unsecured creditor committee in the Voyager Digital bankruptcy case.
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