In an effort to start anew, FTX’s newly appointed financial advisors are seeking to recover millions of dollars that were paid to celebrities such as Shaquille O’Neal, Stephen Curry, Naomi Osaka, and other athletes who endorsed the exchange prior to its bankruptcy filing.
According to court documents, the advisors have disclosed their intention to potentially reverse some of the payments made by FTX before it filed for Chapter 11 bankruptcy, in accordance with bankruptcy laws.
FTX had entered into a sponsorship agreement with basketball legend Shaquille O’Neal, with the exchange paying approximately $4.3 million to Shaq and his affiliated company, Authentic Brands Group. Shaq was also named in the FTX class action lawsuit.
Tennis star Naomi Osaka, another athlete on FTX’s endorsement list, received $2 million from FTX affiliate West Realm Shires Services Inc. just two days before FTX filed for bankruptcy. The estimated total payment to Osaka amounts to around $3.2 million.
Basketball player Stephen Curry is also among the celebrities who endorsed the troubled crypto exchange and received payment prior to its bankruptcy. FTX deposited $242,000 into Curry’s business, SC30 Inc.
The court documents further mention baseball star Trevor Lawrence, who received payments totaling $500,000 in September 2022. Retired baseball player David Ortiz and his charity, which funds heart surgeries for children, received a payment of $600,000.
FTX also sought to boost its profile by sponsoring major sporting leagues, including the United States’ Major League Baseball (MLB) and National Basketball Association (NBA) teams. The exchange made payments of nearly $3.4 million to the Golden State Warriors, $1.2 million to the Washington Wizards and its owner Monumental Sports and Entertainment, and $484,000 to the Miami Heat.
Additionally, FTX sponsored the MLB, paying the league approximately $4.9 million for umpires to wear patches featuring the FTX logo. The exchange also entered into a $12.2 million agreement with the former Formula 1 champion racing team, Mercedes-AMG Petronas, before the bankruptcy filing. Mercedes subsequently severed ties with FTX.
In December 2022, several endorsers voluntarily offered to return the payments made by FTX in an effort to assist customers and other creditors affected by the actions of FTX under the leadership of Sam Bankman-Fried.
The new CEO of FTX, John Ray III, stated during the Chapter 11 filing that the company lacked complete financial information, making it difficult to determine if any league teams or athletes repaid or offset the amounts paid by the exchange led by Sam Bankman-Fried.
