Betting News 
Dapper Labs, known for pioneering NBA Top Shot collectibles on the blockchain, has agreed to a $4 million settlement in a class-action lawsuit alleging securities law violations. The settlement, still awaiting court approval, aims to reimburse claimants and cover legal expenses, marking a significant step towards legal clarity for Dapper Labs.
Under the terms of the proposed settlement, plaintiffs will relinquish any claims that Dapper Labs’ NBA-themed NFTs constitute securities, aligning with the legal treatment of traditional trading cards.
“Dapper Labs is pleased to resolve this matter, allowing us to focus on creating outstanding experiences for our users,” stated CEO Roham Gharegozlou. He emphasized the decentralized nature of the Flow blockchain and the non-security status of digital collectibles like NBA Top Shot.
The lawsuit, initiated in the U.S. District Court for the Southern District of New York, challenged the classification of NBA Top Shot Moments as unregistered securities, suggesting their value is tied to the success of the platform. Plaintiffs further accused Dapper Labs of market manipulation and delaying withdrawals.
The case gained prominence when a federal judge decided it had sufficient grounds to proceed, pointing to the potential classification of Top Shot NFTs as securities due to their operation on the less decentralized Flow blockchain, in contrast to networks like Bitcoin or Ethereum.
As part of the settlement agreement, Dapper Labs will enact several business modifications, including the transfer of FLOW tokens to the autonomous Flow Foundation and the facilitation of third-party sales of Top Shot NFTs. These adjustments aim to enhance market fairness and streamline the withdrawal process, reinforcing the integrity of the platform.
This resolution provides Dapper Labs with a clearer framework to continue its innovative work in the blockchain space, focusing on user engagement and the expansion of the digital collectibles market.
