Dapper Labs Agrees to $4M Settlement in Class Action Securities Suit

In 2021, the class action plaintiffs accused Dapper Labs’ flagship product – the NBA Top Shot Moments – of being unregistered securities because, they said, the value of the NFTs would increase with the popularity of the project as a whole. Plaintiffs also claimed that Dapper Labs prevented investors from cashing out for “months on end” to keep value locked on the platform, and did not allow Moments to be bought or sold on outside NFT platforms at the time the suit was filed.

In subsequent court filings, Dapper Labs’ lawyers vehemently denied that their NFTs were securities, arguing that they were essentially digital basketball cards.

The settlement agreement filed Monday would bar the plaintiffs from claiming that their NFTs are securities, in exchange for an aggregate settlement fund of $4 million. According to Gharegozlou, the money will go towards payments to the class members, attorneys’ fees and settlement administrator costs.

Source: Dapper Labs Agrees to $4M Settlement in Class Action Securities Suit