Three American sports personalities, Rob Gronkowski, Victor Oladipo, and Landon Cassill, settled a case on May 3, agreeing to collectively pay $2.42 million in response to allegations related to their promotion of the defunct crypto exchange Voyager Digital. Gronkowski agreed to pay the highest amount at $1.9 million, Oladipo settled for $500,000, and Cassill agreed to pay $25,000. The settlement provides insight into the financial implications and legal aspects of their involvement in the promotion. Also, plaintiffs are seeking $792,000 in attorney fees in addition to the settlement amount.
The settlement was negotiated through mediation to determine whether Voyager’s products were unregistered securities and if the promoters improperly solicited investors. Gronkowski, in particular, was deeply involved with Voyager as a partner, VGX token holder, shareholder, and exchange ambassador. Voyager Digital filed for bankruptcy in July 2022 due to market turmoil caused by the Terra/Luna collapse and default of loans to the Three Arrows Capital (3AC) hedge fund, leading to its downfall. However, in April 2024, Voyager began compensating creditors by securing $484 million through settlements with FTX, Three Arrows Capital, and Directors and Officers (D&O) insurance claims, covering around 25% of creditor claims.
While the sports personalities have settled in the case, the main defendant Mark Cuban, the minority owner of the Dallas Mavericks, has yet to come to the table. Cuban faces a trial scheduled for November 2024 for his involvement in promoting Voyager’s Earn Program Accounts (EPAs) classified as unregistered securities. The NBA is also facing a lawsuit for alleged “gross negligence” in their marketing partnership with the defunct crypto exchange, alongside Cuban and the Dallas Mavericks. The NBA’s decision to support the partnership has led to criticisms, with suggestions for an NBA ban on crypto sponsorships.
The settlement with Gronkowski, Oladipo, and Cassill comes following lawsuits filed in 2022 and 2023, with claims against the sports personalities for their involvement in promoting Voyager Digital. The settlement covers financial implications and legal aspects of their promotion activities and includes negotiations to determine the status of Voyager’s products as unregistered securities. The bankruptcy filing of Voyager in 2022, due to market turmoil, led to a series of events that ultimately resulted in the exchange’s downfall but efforts have been made to compensate creditors through settlements with various parties.
Voyager Digital’s bankruptcy in 2022 was a result of market turmoil stemming from the collapse of Terra/Luna and default of loans to the Three Arrows Capital (3AC) hedge fund. The settlement reached in April 2024, securing $484 million, highlights efforts to compensate creditors, covering a portion of their claims. The involvement of sports personalities like Gronkowski, Oladipo, and Cassill in promoting Voyager has led to legal challenges and settlements, providing insights into the financial implications and legal aspects of such activities. The upcoming trial involving Mark Cuban and the Dallas Mavericks will shed further light on the allegations of promoting unregistered securities and the role of the NBA in the partnership with Voyager Digital.
