Riot Games to terminate FTX sponsorship due to "reputational harm"
Riot Games to terminate FTX sponsorship due to "reputational harm"
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North America (NA) League of Legends Championship Series, LLC (Riot) has made a filing in the FTX bankruptcy case requesting that the court either “compel FTX to reject the Agreement” or allow Riot to terminate the Strategic Sponsorship Agreement it has with FTX.
According to Riot, the Agreement, signed on Aug. 21, 2021, is non-assignable “and thus FTX cannot assume it under the Bankruptcy Code,” as stated by Riot.
Riot says that it is seeking to end the sponsorship with FTX due to the following:
“The reputational harm already caused to Riot as a result of the highly public disrepute wrought by the debacle preceding FTX’s bankruptcy filing.”
Additionally, Riot has announced its independent right to terminate the Agreement due to the violation of the morality clause, which states:
“33. The parties agreed to a reciprocal morality clause, granting both parties termination rights.”
This clause grants either party the right to terminate the Agreement if the other party “commits any act or becomes involved in any situation or occurrence” that brings “the Impacted Party’s products and services into material public disrepute” in a manner than cannot be mitigated.
Riot also noted that it has “faced significant non-monetary and monetary damage due to its ongoing association with FTX.”
On Jan. 11, 2023, the United States (U.S.) Bankruptcy Court for the District of Delaware will hold a hearing regarding FTX Trading Ltd.’s Chapter 11 bankruptcy filing.
Riot Games is the developer and publisher of the popular multiplayer online video game League of Legends, and Riot hosts live-event competitions featuring the game.
Journalist at CryptoSlate
Josh has been writing for a decade and is passionate about mainstream crypto adoption, bringing positive financial change to the masses through crypto and decentralized finance as a whole.
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