NBA Top Shot NFT Lawsuit Settled for $4 Million
A lawsuit against Dapper Labs, the company behind NBA Top Shot NFTs, has been temporarily settled for $4 million.
The lawsuit, filed in 2021, alleged that Dapper Labs violated federal securities laws with their NBA Top Shot product.
The crux of the issue? Investors claimed NBA Top Shot Moments were essentially unregistered securities. Specifically, the lawsuit pointed to:
- Promises of Value Increase: The plaintiffs argued that Dapper Labs made claims suggesting their NFTs would increase in value, which can be seen as incentivizing investment and potentially illegal under securities laws.
- Trading Restrictions: The lawsuit also highlighted limitations placed on buying and selling NBA Top Shot NFTs. Investors reportedly faced periods where they couldn’t cash out or trade their Moments on external platforms, keeping all activity within Dapper Labs’ own marketplace.
Settlement Reached, Conditions Attached
To resolve the lawsuit, Dapper Labs has agreed to create a $4 million settlement fund for the investors.
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However, the settlement comes with strings attached. Court documents show that the investors involved must agree to stop claiming NBA Top Shot NFTs are securities as part of the deal.
This settlement is temporary, but it marks a significant development in the ongoing debate surrounding NFTs and their classification under securities laws.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
