Mike Tyson Sues Former Business Partners For $50M, Alleging Wire Fraud, Embezzlement, And More – AfroTech
Mike Tyson has filed a lawsuit against his former cannabis business partners.
Tyson owns a venture-backed cannabis brand called Tyson 2.0, as AFROTECH™ previously told you. Tyson also acquired Ric Flair Drip, Inc. in 2022 to commercialize pro wrestler Ric Flair’s intellectual property, leading to the launch of cannabis products featuring Flair’s likeness.
Front Office Sports reports Carma HoldCo Inc. and LGNDS partnered to distribute products from Tyson 2.0 and Ric Flair Drip. Tyson also assumed the role of Carma’s chief executive officer in April, according to a press release.
“Carma HoldCo was built on the belief that powerful stories and even more powerful products can change how people connect with wellness, entertainment, and culture,” said Tyson in the release. “This isn’t just a title — it’s a responsibility I take seriously. I’ve wanted to be more involved for a long time, and now is the right time to take that step. I’m fully committed to making sure everything we create stays true to who we are while growing in new and exciting ways.”
Lawsuit Explained
As of December, Tyson is bringing claims against former executives and a shareholder of Carma HoldCo Inc. in a lawsuit filed in a U.S. District Court in Illinois, per Front Office Sports. The lawsuit claims that Chad Bronstein, Adam Wilks, Nicole Cosby, and James Case engaged in a “brazen RICO conspiracy involving criminal wire fraud, embezzlement, money laundering, and extortion, as well as securities fraud and shameless self-dealing that enriched the Defendants to the tune of tens of millions of dollars.”
The lawsuit alleges that Bronstein, Wilks, and Cosby sold licensing rights that were not a part of their business deal. Additionally, it alleged that Wilks participated in a “kickback” deal with DomPen, which sells disposable vapes, and he “concealed payments in exchange for turning a blind eye to DomPen’s unauthorized use of Carma’s intellectual property,” notes Front Office Sports.
Additionally, the lawsuit alleges that Bronstein and Wilks treated Carma HoldCo as a “personal piggy bank,” claiming more than $1 million was used on unauthorized transactions such as “personal travel on private jets, costs associated with Bronstein’s personal yacht, renovations to Bronstein’s personal residence, a mortgage payment for Wilks’ personal residence, and lavish entertainment expenditures for Wilks,” including expensive meals and travel, as well as unapproved compensation and bonuses, per Front Office Sports.
The plaintiffs are seeking more than $50 million in damages, legal fees, and additional costs, notes the outlet.
Defendants Respond
The defendants have responded to the claims in the lawsuit.
“The complaint is fiction dressed up as a lawsuit,” Jonathan Cyrluk, the attorney for Bronstein and Cosby, said, according to Front Office Sports. “Before filing, the plaintiffs tried to intimidate my clients with settlement demands that read more like a shakedown than a legal claim — demanding millions of dollars and attempting to force others to surrender their Carma shares. My clients won’t be bullied and are prepared to knock out this meritless lawsuit in court.”
Wilks’s attorney, Terry Campbell, commented:
“These claims are as credible as the people they come from — in short, the allegations are without substance. This is nothing more than an attempt to spit out an earful of salacious headlines and attempt to coerce my client into paying money to them when he did nothing wrong. We will fight these meritless allegations — both the facts and the law are squarely on our side.”
