“The Game,” an American Rapper and Actor, Faces a Class Action Lawsuit Over Cannabis Crypto Startup
Jayceon Terrell Taylor, a.k.a. The Game, faces a $12 million judgment for his role in Paragon Coin, Inc., a crypto company accused of conducting an “unregistered initial coin offering” (ICO) four years ago.
Astley Davy et al. v. Paragon Coin et al.
Investors filed a class action lawsuit at the federal court in California against the executives of cannabis crypto startup Paragon Coin Inc., alleging they violated the Securities Act when they launched the startup’s $70 million initial coin offering (ICO).
Plaintiff Astley Davy first filed the class action in January 2018, stating that Paragon Coin violated securities laws by failing to register its ICO with the United States Securities and Exchange Commission when he purchased $1,600 worth of tokens.
Between April 15 and October 15, 2017, the company raised $70 million through the sale of PRG tokens to be used as a currency for the cannabis industry. When the plaintiffs initially filed their complaint in 2018, a judge found that they did not adequately explain why the company hired Taylor.
However, the Plaintiffs sought to hold the rapper responsible for damages, stating that he was soliciting cryptocurrency transactions through his social media. Additionally, they allege that Paragon hired him as a celebrity ambassador in order to attract investors.
A Sticky Situation
Coin Telegraph reports that The Game openly sponsored the Paragon Coin ICO in 2017 and is now regarded as a team member and “statutory seller.”
However, following an additional complaint, United States Federal District Judge Jeffrey S. White stated in a California court on June 23 that the plaintiffs now had sufficient evidence to establish Taylor “acted for his own or Paragon’s benefit.”
As a result, White entered default judgments against the company’s founders Jessica VerSteeg and Egor Lavrov, as well as executives Eugene Bogorad, Alex Emelichev, and Gareth Rhodes, alleging they were liable for more than $12 million in damages, plus interest both pre and post-judgment.
Plaintiffs said that the corporation marketed the tokens as a currency for the cannabis industry when they were actually an investment in real estate for coworking spaces. They were pursuing profit disgorgement, but it is unknown how or even if Paragon would repay investors. According to reports, the founders declared bankruptcy and fled the United States.
Meanwhile, in a class action lawsuit involving another cryptocurrency known as FLiK tokens, rapper T.I. and film producer Ryan Felton was accused of security law violations. However, an opinion in favor of the duo was issued last week by the 11th Circuit Court of Appeals.
Editor’s Note on The Game Paragon Coin Class Action Lawsuit 2021:
This article is written to advise you of The Game’s role in a cryptocurrency company involving the cannabis trade.
Case Name & No.: Astley Davy et al. v. Paragon Coin et al., Case no. 4:18-cv-00671
Jurisdiction: U.S. District Court – Northern District of California
Products/Services: Paragon Coin
Allegations: Paragon Coin, Inc. allegedly conducted an unregistered initial coin offering and violating the Securities Act
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