🔥 Dapper Labs Settles Top Shot NFT Lawsuit
posted 4 Jun 2024
Dapper Labs, creators of the NBA Top Shot NFT collection, will pay $4 million to settle a lawsuit with token holders who accused the company of selling unregistered securities. The plaintiffs have agreed to withdraw the lawsuit and refrain from filing future claims.
Dapper Labs, creators of the NBA Top Shot NFT collection, will pay $4 million to settle a lawsuit with token holders who accused the company of selling unregistered securities. The plaintiffs have agreed to withdraw the lawsuit and refrain from filing future claims.
The lawsuit against Dapper Labs was filed in 2021. The plaintiffs argued that the value of the NFTs was tied to the project's overall success, suggesting they were unregistered securities. Dapper Labs countered by saying that Top Shot NFTs were akin to digital versions of traditional paper trading cards, not securities.
In February 2024, a federal court observed that the company's representatives had implied the tokens would increase in value over time. Another significant point during the February hearing was that Top Shot NFTs operated on the Flow blockchain, which was purportedly owned by Dapper Labs and was centralized, giving the company certain control.
Dapper Labs disagrees with these findings, maintaining that Flow has always been and remains decentralized, managed by the independent Flow Foundation. To reinforce this stance, and in conjunction with settling the lawsuit, the company transferred the remaining Flow tokens from its wallets to the Flow Foundation.
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