Sotheby’s Holdings Inc. is being sue by a group of investors and others over the 2021 auction and promotion of Bored Ape Yacht Club non-fungible tokens NFT due to a decrease in the value of the celebrity-endorse antiques.
In a class action lawsuit, four plaintiffs claim that the auction house “misleadingly promoted” the NFTs and conspired with Yuga Labs, the NFTs’ maker, to artificially raise their pricing.
The lawsuit names 30 defendants, including Sotheby’s, and also accuses celebrities like Justin Bieber and Paris Hilton of endorsing the NFT collection while concealing their financial ties to it.
The vibrant digital paintings of apes are currently available for as cheap as $52,445, according to cryptocurrency market tracker CoinGecko. The least expensive would have cost collectors more than $400,000 as recently as May 2022.
at September 2021, Sotheby’s outperformed the pre-sale estimate of $12 million to $18 million by selling over 100 of the NFTs to a single buyer at an online auction for more than $24 million.
The new complaint, which was first submitted in December without mentioning Sotheby’s as a defendant, asserts that the sale was “deceptive” and that Yuga Labs, a startup, hired the auction house to “generate investors’ interest and hype around the Bored Ape brand.”
The complaint claimed that Sotheby’s claims that the unidentified buyer was a traditional collector had falsely suggested that the market for (Bored Ape Yacht Club) NFTs had expanded to include a wider demographic.
The auction house declared: Sotheby’s is ready to forcefully defend itself against the claims made in this lawsuit, which are without merit.
Justin Bieber’s and Paris Hilton’s representatives requests for comment. The lawsuit claims that Justin Bieber and Paris Hilton “feigned interest” in the NFTs in order to profit financially.
While this was going on, a representative for Yuga Labs issued the following statement via email: “We feel that these new allegations, like those in the prior of this opportunistic complaint, are utterly without merit or factual basis.