Dapper Labs Reaches $4 Million Settlement in NBA Top Shot NFT Lawsuit

Dapper Labs, the company behind NBA Top Shot, has reached a $4 million settlement in a class-action lawsuit related to the sale of Top Shot NFTs. The lawsuit claimed that the NFTs offered by Top Shot constituted illegally offered securities. As part of the settlement, Dapper will pay out monetary relief to the plaintiffs and cover legal fees. In return, the plaintiffs will give up their right to claim that Top Shot NFTs are securities. The settlement provides legal clarity for Dapper Labs and allows them to focus on their core mission. Last year, a federal judge ruled that the lawsuit could proceed based on the argument that Top Shot NFTs met the definition of a securities offering. The judge cited the fact that Top Shot NFTs live on the Flow blockchain, which is controlled by Dapper Labs. The settlement also includes certain business changes for Dapper Labs, including the relinquishment of FLOW tokens to the Flow Foundation. This lawsuit marked one of the first tests of the security status of NFTs, which have faced regulatory scrutiny in recent years.