TL;DR Breakdown
- Shaq Oneal faces a class-action lawsuit for a security laws violation in his Solana NFT project ‘Astrals.
- Astral is a community-driven project on the Solana blockchain comprised of 10,000 unique 3D avatars with 16 races, all with unique features.
- Shaq Oneal joins other influencers, such as Soulja Boy and Akon, who have been sued for promoting cryptocurrencies.
Description
Basketball star Shaq Oneal faces a class-action lawsuit for a security laws violation in his Solana NFT project ‘Astrals.’Shaq Oneal allegedly abandoned the project after the FTX collapse, which led to a plummet in the value of the project. The project in question was closely tied to his celebrity status, which is part of the … Read more
Basketball star Shaq Oneal faces a class-action lawsuit for a security laws violation in his Solana NFT project ‘Astrals.’Shaq Oneal allegedly abandoned the project after the FTX collapse, which led to a plummet in the value of the project. The project in question was closely tied to his celebrity status, which is part of the claims in the amended complaint filed on Thursday.
What is the Astral project?
Astral is a community-driven project on the Solana blockchain. The Solana-based NFT project comprised 10,000 unique 3D avatars with 16 races, all with unique features. According to the project whitepaper, it has two core components: A story-driven Play-to-earn role-playing game and a Decentralised Autonomous Organisation(DAO).
The suit raises an issue on the DAO’s governance token($GLXY), stating it is unregistered. Venture capital firms such as MH Ventures and Cypher Capital are also mentioned in the claim after partnering with Astrals as third parties. The project was Shaq Oneal’s brainchild, and the appointment of Myles Oneal as the head indicated that the team used the project as a marketing opportunity.
The initial lawsuit
A district judge, Federico Moreno, in the pretrial conference, appointed the lead claimants in the class action suit represented by Moskowitz Firm last month. The amended complaint is a 111-page filing, which was termed a pivotal step forward by Adam Moskowitz. He also said that selecting the lead claimants as their clients is a big win for them as they can now run the show on behalf of the investors after several attempts.
The firm is also involved in several other class-action lawsuits involving cryptocurrencies, including those that emerged from the collapse of FTX and Voyager. The basketball legend was previously served with the initial suit involving Astral at an NBA game earlier this year after several accusations of dodging process servers. The initial suit focused on how Shaq Oneal promoted the Astrakl project, including his musical performances and social media posts.
The 54-page complaint contained six suits alleging that Shaq Oneal violated laws such as the Virginia Consumer Protection Act and the Unfair Trade Practices Act. Boies Schiller Flexner Llp and Moskowitz Firm led the initial suits.
Shaq Oneal was also served with a suit originating from an advertisement he did for FTX, where he was added as a defendant alongside Sam Bankman-Fried. Shaq Oneal joins other influencers, such as Soulja Boy and Akon, who have been sued for promoting cryptocurrencies.
The amended complaint
The amended complaint focuses on the phenom’s involvement in Astrals by selling unregistered tokens. Shaq Oneal partnered with his son and manager to launch the project in 2022, which was soon advertised on his social media platforms.
The Howey Test will determine whether the NFT Tokens were unregistered. The test was developed in the Supreme Court landmark decision in 1946, which has since become the legal standard in determining whether an asset is an investment contract under the US Securities laws.
The amended plaint states that Shaq Oneal was closely tied with Astrals, and the entire project value was based on the legend’s celebrity status. However, this was short-lived, as the O’neal abandoned the project after the FTX Collapse in November when he allegedly abandoned the community.
Shaq Oneal’s lawyers responded to the initial complaint, asking the lawsuit to be dismissed, stating that the tokens were intended for gamers and not investors. The motion was denied, according to the filing last month.
The suit alleged he posted on the Astrals Discord community, The Wolf of Wall Street GIF with the caption, “I am not fucking leaving.”However, the basketball legend has not contacted the community, making the last engagement on January 2. The star has until September 29 to respond to the amended complaint.
Shaq Oneal joined the list of celebrities facing lawsuits over their involvement with cryptocurrencies and NFTs. The basketball icon publicly endorsed the Astral Project and is accused of abandoning the community after the FTX collapse, further contributing to the project’s losses.
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