Dapper Labs has settled a lawsuit against NBA Top Shot Moments NFT collection for $4 million
The plaintiffs accused the company of trading in unregistered securities
![Dapper Labs has settled a lawsuit against NBA Top Shot Moments NFT collection for $4 million](https://storage.getblock.net/source/1/z7YQgiPxDQHx39JQ1H2n98VITn5GXJFh.webp)
04.06.2024 - 10:42
86
3 min
0
What’s new? Dapper Labs has settled a securities laws class action lawsuit involving its NBA Top Shot Moments collection of non-fungible tokens (NFTs). As part of the settlement agreement, Dapper Labs will pay $4 million to the plaintiffs.
What else is known? In 2020, Dapper Labs launched Flow, a blockchain ecosystem backed by leading sports associations including the NBA, UFC, and NFL. The NBA Top Shot collection launched the same year, featuring short videos of throws and other successful moves by popular players. After its launch, it rapidly gained popularity.
According to CryptoSlam, the monthly trading volume of NBA Top Shots collection tokens peaked at $226 million in February 2021 but has since declined significantly, as has all activity in the NFT sector in general.
![Unknown person makes $1,5 million on the airdrop of the Tensor NFT marketplace](https://storage.getblock.net/source/1/lgMH5vfol4V8Rt4JK5gykQuWXmMMKN4h.png)
Unknown person makes $1,5 million on the airdrop of the Tensor NFT marketplace
Earlier, he also made $45 000 in the Wormhole protocol’s airdrop
According to the plaintiffs, the collection should have been subject to SEC registration, but the company chose to hide important information about the risks inherent in the securities from investors. The company countered by claiming that NFTs bear more resemblance to collectibles and do not fall under the definition of securities.
The plaintiffs alleged that Dapper Labs made hundreds of millions of dollars from the sale of unregistered securities by artificially inflating the market and preventing users from withdrawing their money for months on end.
During the proceedings, the court last February upheld the plaintiffs’ view, noting that buyers could reasonably expect to profit from the work of third parties because the tokens were issued on a blockchain managed by the company. That statement did not mean the company lost, and the proceedings were continued.
The company said in its statement that the collection became available on four external NFT marketplaces in March 2022, giving collectors more flexibility in asset management.
As part of the agreement, charges were also dropped against Dapper Labs co-founder and CEO Roham Gharegozlou. “We are pleased with the results of today’s settlement, which marks a significant step forward for Dapper Labs and the Flow community,” the senior executive said.
According to the company, the settlement reaffirms the company’s position that NFTs in the collection are not securities under federal law.
Useful material?
Incidents
Scammers took advantage of the former US president’s recent announcement of a real DeFi protocol
Sep 4, 2024
Technologies
The upgrade is aimed at implementing a new decentralized project governance system
Sep 2, 2024
Incidents
The company placed $2б4 billion in bonds maturing in 2026, but their value has fallen dramatically since the entrepreneur’s arrest
Aug 30, 2024
Incidents
In both cases, depending on the outcome of the investigations, the messenger could be blocked
Aug 29, 2024
Market
The project will offer a decentralized alternative to traditional banking services
Aug 29, 2024
Trends
Within a week of its launch, the platform managed to overtake its main competitor, Pump.fun on the Solana network
Aug 28, 2024