Screenshot of John Shahidi's X media post. Courtesy imageNFT Buyers Accuse Nelk Boys of Ripping Them Off
“Based on the allegations, there’s a tension between what’s a failed business idea that was launched in good faith and what’s a nefarious rug pull," said Scott Armstrong, a principal at McGovern Weems and former federal prosecutor.
January 30, 2025 at 03:02 PM
4 minute read
What You Need to Know
- The Nelk Boys promised various perks for those who spent $2,300 to purchase one of their NFTs.
- About 10,000 NFTs were sold in 10 minutes, generating a $23 million return from the offering, according to the complaint.
- The potential class essentially alleged “a slow-burn rug pull,” leading one outside expert to suggest that the success of the litigation could hinge on intent.
A class-action complaint filed in a California federal court accused the Nelk Boys, internet personalities and entrepreneurs, of running an NFT scheme that generated $23 million in sales within 10 minutes but failed to deliver on “any of the promised business ventures or investment opportunities.”
Thomas Kherkher, a partner at Ellzey Kherkher Sanford Montgomery in Houston, Texas, is among the attorneys who represent the plaintiff, Trenton Smith, and the prospective 10,000-member class. Kherkher said the case is part of a larger trend in which individuals are sold NFTs that grant certain privileges that the seller failed to provide or are far less than advertised.
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