Former NBA star Shaquille O’Neal has recently achieved a significant milestone by receiving court approval for a $11 million settlement related to a class-action lawsuit involving the Astrals non-fungible tokens (NFTs). This decision was made by U.S. District Judge Federico Moreno in a Florida federal court, and it marks a notable moment in the evolving world of NFTs and celebrity endorsements.
The settlement, approved on April 1, 2023, established a fund of up to $11 million for eligible class members who had purchased Astrals NFTs between May 2022 and January 15, 2023, as well as those who acquired the project’s native GLXY tokens up until mid-January. Additionally, $2.9 million has been allocated for attorney fees and costs, a decision described by Judge Moreno as fair and reasonable.
This lawsuit arose in May 2023, when O’Neal faced allegations concerning the promotion of the Solana-based Astrals NFT project, deemed as an “offer and sale of unregistered securities.” The plaintiffs claimed they suffered significant financial losses due to the misleading conduct attributed to O’Neal’s promotion.
In previous hearings, Judge Moreno acknowledged that the class suit effectively argued that O’Neal acted as a seller of the NFTs. Following a strategic decision, O’Neal agreed to the settlement by November 2023, providing a resolution for those affected.
To give context, the Astrals NFT collection is comprised of 10,000 unique 3D digital collectibles, designed by artist Damien Guimoneau in April 2022. The project sought to create an engaging virtual realm for users to socialize and interact, ostensibly including participation from celebrity endorsers like O’Neal.
Current Landscape of NFT Sales
Despite the ambitious nature of the Astrals NFT project, recent data suggests a bleak landscape for NFT sales overall. As of early April 2023, NFT sales have dwindled significantly, registering a mere $27 million after reaching peaks exceeding $2 billion per week at the end of 2021. This profound downturn indicates a broader downturn in the market, challenging the sustainability of many projects.
As we analyze the ramifications of O’Neal’s settlement and the market’s status, it raises essential discussions on the regulatory framework surrounding NFTs and celebrity involvement. The implications of this case extend beyond individual losses, potentially reshaping how NFTs are marketed and sold in the future.
