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The NFL Players Association (NFLPA) has filed a $65 million lawsuit against DraftKings alleging breach of contract as part of a failed NFT (non-fungible tokens) deal.
According to Front Office Sports, the federal lawsuit, filed in the Southern District of New York, “centers on a deal the union made with DraftKings to use players’ NIL (name, image, and likeness) in its NFT marketplace.”
DraftKings closed down its NFT marketplace in July, “due to recent legal developments,” and ended their agreement with the NFLPA on July 29, but still owes the union money, the lawsuit claims.
DraftKings is currently also being sued over allegations that its NFT marketplace violated securities laws.
“The impetus for DraftKings’ decision to repudiate its license agreement with Plaintiffs is simple: the once white-hot market for NFTs has cooled down,” the NFLPA lawsuit reads. “DraftKings is also facing a civil lawsuit and regulatory inquiries into its product. Buyers’ remorse, however, is not a basis to terminate a contract.”
The deal between the NFLPA and DraftKings was signed in 2021. Since 2021, the lawsuit claims, five DraftKings’ executives earned an income totaling approximately $261.1 million, and “the total compensation of just these five aforementioned officers since 2021 is approximately quadruple of what DraftKings owes the NFLPA Licensors.”
ESPN reports the NFLPA’s complaint also states, “At the end of the day, and despite DraftKings’ best efforts to muddy the waters, this case is extraordinarily simple. DraftKings’ inability to profitably commercialize the intellectual property it licensed does not excuse performance, and DraftKings must pay what is due.”
A December 2023 report revealed that despite warnings from people like Bill Gates, over 23 million people own a NFT investment that is now worthless.
Another report published in September 2023, stated that 95% of all NFTs have a value of zero dollars.
Pretty striking since in August 2021, NFTs had nearly $2.8 billion in monthly trading volume.
Perhaps the fact that one guy, Geoffrey Huntley, right clicked and stole every NFT in existence in December 2021 and uploaded them to NFT Bay as a torrent, giving them away for free, should have been a clue that the NFLPA’s deal with DraftKings wasn’t ever going to work out.