A recent legal action alleges that the Mercedes-AMG Petronas F1 Team and Major League Baseball (MLB) played a role in fraudulent activities associated with FTX through their promotional partnerships with the cryptocurrency exchange.
This lawsuit, initiated by a group of FTX users, comprises twin class-action suits filed in a Florida district court on November 27. The plaintiffs assert that both entities were complicit in the “massive, multibillion-dollar global fraud” orchestrated by the FTX Group, accusing them of promoting unregistered securities.
In 2021, Mercedes F1 entered into a promotional agreement with FTX, featuring the exchange’s logo prominently displayed on cars, uniforms, hats, and various materials.
MLB followed suit with a similar deal, making history as the first professional sports league to engage in such a partnership. Umpires in MLB wore uniforms adorned with FTX’s logo, marking the first instance in the league’s long history that a sponsor brand had its logo featured on umpire uniforms.
The class complaint against Mercedes F1 mirrored the accusations against MLB, emphasizing the prominent placement of FTX’s logo on cars, merchandise, and marketing materials. The lawsuit also highlighted FTX’s regular expressions of support and congratulations towards Mercedes F1 and its drivers, creating what the legal filing described as a “veneer of trustworthiness with Mercedes F1 fans.”
The same group of FTX users is concurrently pursuing legal action against several celebrities who endorsed the cryptocurrency exchange, including former sports figures Shaquille O’Neal and Tom Brady. These lawsuits allege similar offenses of promoting unregistered securities.
While some celebrities have sought to dismiss the suits, arguing that they did not encourage deposits into FTX, a few have settled, including professional American footballer Trevor Lawrence and YouTubers Kevin Paffrath and Tom Nash.
In a significant development, FTX founder and former CEO Sam Bankman-Fried faced legal consequences, being convicted on seven charges related to fraud, conspiracy, and money laundering in November.
The MLB terminated its five-year promotional contract with FTX just over a year after the agreement was signed, coinciding with FTX’s filing for bankruptcy in November 2022.
Similarly, Mercedes F1 terminated its partnership with FTX in the same year, removing the exchange’s logo from cars and merchandise.