Mark Cuban is facing legal action for advertising Voyager Digital

Mark Cuban, the billionaire owner of the Dallas Mavericks basketball club, is being sued by investors in Voyager Digital and Mavericks fans for advertising Voyager Digital, which filed for chapter 11 bankruptcy on July 5, 2022.

According to the plaintiffs, Cuban advertised Voyager Digital to Mavericks fans on many occasions and took advantage of the basketball fans' naivety. The complaint contains various remarks from Cuban advertising Voyager Digital, including the following:

"“I gotta add, I am a [Voyager] customer and I’ve been a customer for several months now. I like to use it, it’s easy, it’s cheap, it’s fast, and the pricing is actually really good, so we find it as a perfect fit for our Mavs fans and reaching Mavs fans of all ages.”

Plaintiffs assert that Cuban marketed Voyager Digital as commission-free and overall less expensive than its rivals. Nonetheless, the complaint claims that investors were exposed to hidden fees and unreasonablely high costs without their knowledge.

Utilizing the support of the supporters

The complaint alleges that Steve Ehrlich, the CEO of Voyager Digital, manipulated Maverics fans into investing in the project. The lawsuit contains remarks made by Ehrlich and Cuban during their news announcement for the Dallas Mavericks.

During his conference speech, Cuban stated that there is no way to profit without first investing, but with Voyager Digital, consumers may gain by investing tiny sums. He said:

“digital currencies[are] an attractive investment for novice investors who might only have $100 to start. That’s where Voyager enters the picture. […] Voyager platform makes the process easy and simplified for fans of all ages. […] You don’t have to spend a lot of money in order to learn.”

In addition to pushing the concept of small investments yielding large returns, Cuban also noted the sector's lack of knowledge. He stated that the majority of people do not comprehend the principles of crypto, and that Voyager Digital will "attempt to educate our supporters and joint consumers."

Ehrlich endorsed Cuban by highlighting Voyager Digital's user-friendly design and the significant acceleration of crypto adoption rates.

In addition, Cuban was caught on tape stating that Voyager Digital is completely risk-free. A complainant recounts this specific remark and states:

“[I] saw many statements from Mark Cuban stating that Voyager was “100% Risk Free, and it’s as close to risk free as you are going to get in the crypto universe . . . [Mark Cuban’s] trust in Voyager [] made me purchase the coin from Voyager . . .”

Voyager Digital bankruptcy

A few days after Three Arrows Capital (3AC) filed for Chapter 11 bankruptcy, Voyager Digital filed for the same protection. Voyager Digital stated that 3AC owes them 15,250 Bitcoins and $350 million USDC. Chapter 11 bankruptcy permits the company to continue operating while allowing it to restructure its internal operations and business strategies.

Ehrlich cited 3AC's debt and negative market circumstances while declaring the bankruptcy. He also stated that the Chapter 11 bankruptcy was an effort by the crew to optimize Voyager's recovery before the ship was past the point of no return.