Riot Games is Suing FTX Over Alleged “Reputational Harm”
Riot Games is suing FTX in the United States Bankruptcy Court and seeking to end its partnership with the cryptocurrency exchange. The two companies had previously signed a seven-year agreement for FTX to be the official cryptocurrency sponsor for the League of Legends Championship Series (LCS). However, FTX filing for bankruptcy earlier this year and has only paid half of the agreed-upon $12.5 Million USD to Riot Games in the 2022 calendar year, according to submitted by Riot Games to the bankruptcy court.
FTX is yet to pay Riot Games its due for the 2022 calendar year
FTX had also partnered with esports organization TSM. TSM and FTX entered a partnership where FTX invested $210 Million USD as part of a 10-year deal between the esports team and the crypto exchange. TSM released an official statement addressing FTX’s bankruptcy and the organization revealed that it is not aware of what led to its investor’s bankruptcy aside from publicly known information.
With 2023 right around the corner, FTX owes its first payment to Riot Games for the next calendar year on 3rd January 2023. If the deal went smoothly, Riot and FTX would be partnered until the 2018 LCS season. The total payout to Riot Games would amount to $96 Million USD according to reporter .
Riot stated in the court documents, “There is simply no way for FTX to cure the reputational harm already caused to Riot as a result of the highly public disrepute wrought by the debacle preceding FTX’s bankruptcy filing. FTX cannot turn back the clock and undo the damage inflicted on Riot in the wake of its collapse.”
Sam Bankman-Fried, the founder of FTX, was arrested in The Bahamas earlier this week. He was accused of playing League of Legends during company meetings. Riot Games revealed in the court documents that its image is “inextricably linked” with FTX and Sam-Bankman Fried due to his love of League of Legends.
The first hearing for Riot Games’ lawsuit against FTX will commence on 11th January 2023.