By Colin Kruger
David Beckham is suing his former neighbour and friend Mark Wahlberg over a failed celebrity endorsement deal with embattled Aussie fitness franchise F45 which allegedly cost him $US10 million ($16 million).
The former footballer says Wahlberg was instrumental in signing him to the deal in 2020 which led to Beckham becoming one of F45’s celebrity ambassadors before its public float on the New York Stock Exchange the following year.
David Beckham (right) is suing Mark Wahlberg.Credit:
“I’ve been a fan of the F45 franchise and training model since being introduced by my friend Mark Wahlberg,” Beckham said after becoming a global brand ambassador for F45.
The former Beverly Hills neighbours are now on opposite sides of a US District Court legal battle over shares in the company that Beckham was promised.
Wahlberg was a significant investor in F45 at the time of Beckham’s agreement and a director of the fitness group.
Better days: F45 founder Adam Gilchrist (right) and shareholder Mark Wahlberg on the floor of the New York Stock Exchange in 2021.Credit: Getty Images
F45 started with one gym in Australia in 2013. It developed the global franchise on the back of 45-minute functional, high-intensity interval and circuit training classes.
Beckham’s firm DB Ventures Ltd (DVBL) alleges he lost more than $US10 million when F45 stocks he was promised were withheld until after the company’s share price plummeted from its IPO price of $US16 to below $US3 in 2022 – one year after the float.
His lawyers claim this delay cost him millions in potential profit.
F45 struck multimillion-dollar endorsement deals with other celebrities such as basketballer Magic Johnson, Australian golfer Greg Norman and supermodel Cindy Crawford. They were deemed crucial to the fitness group getting its name familiar with US gym enthusiasts.
“The company disputes these claims and intends to vigorously defend itself,” F45 said in its financial statements last year when Beckham and Norman first took legal action against the group.
The most lucrative celebrity endorsement deal belonged to Wahlberg. He received 2.74 million share rights, which vested with the IPO at a valuation of just under $US44 million, and sold more than $US10 million worth of stock in the year following the float.
Wahlberg was also part of a group that invested $US100 million in F45 back in 2019. Wahlberg and his business partners sold $US25 million worth of shares at $US16 each ahead of F45’s NYSE public debut, but also offloaded 3.2 million shares to Australian fund manager L1 Capital in 2020.
Hollywood actor Mark Wahlberg working out at an F45 gym.Credit: Getty
F45’s stock was struggling within months of its public debut and was barely above the $US10 mark by the year’s end.
What followed in 2022 proved to be disastrous for investors as F45 was forced to slash its earnings guidance in July and make workers redundant as the debt it was relying on to fuel franchisee expansion dried up. Shares dropped to a low of $US1.35 just a year after its stock market debut.
The company was ejected from the New York Stock Exchange last year, its stock last changing hands for just US15¢. Financial accounts released in October last year reported that it made a loss of more than $US370 million over the previous two financial years. The company has not given any financial updates since that time.
Beckham’s DVBL is seeking damages directly from Wahlberg’s investment group – which owns his stake in F45 – as well as F45’s Australian founders, Adam Gilchrist (not the cricketer) and Rob Deutsch.
Wahlberg and his co-defendants claim the allegations of “fraudulent conduct” are baseless and have asked for the lawsuit to be dismissed, according to documents seen by The Sun. F45 failed to have the lawsuit dismissed in September last year.
The Telegraph newspaper in the UK, reporting on the lawsuit, has contacted representatives for Wahlberg and Beckham for comment. This masthead has also contacted Gilchrist and Deutsch for comment.
Beckham is not the only party pursuing legal action against F45, its founders and Wahlberg. F45 investors have launched a class action against the company as well as current and former board members including Wahlberg and Gilchrist. Pledge Capital is the lead plaintiff and US law firm Labaton Sucharow is its legal representative.
The investors allege misleading statements were made by the group ahead of its disastrous public float in July 2021, which the company denies.
- Colin Kruger: F45 on its knees after $US370m loss; celebrities seek damages
- Colin Kruger: Investors feel the burn as F45 booted from New York Stock Exchange
- Colin Kruger, Jessica Yun: ‘Bigger than McDonald’s’: How Australian fitness phenomenon F45 ran out of puff
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