The NFL Players Association (NFLPA) and DraftKings have agreed to a settlement in a 2024 lawsuit surrounding DraftKings’ use of NFTs.
On Monday, the two parties jointly filed a motion in the US District Court for the Southern District of New York requesting a 60-day stay of the suit so that they can finalize the details of the settlement. No dollar amounts were publicized.
agreed to rework the contract in 2023 when DraftKings said it would stop selling NFTs
In 2021, when non-fungible tokens (NFTs) were all the rage, DraftKings partnered with the NFLPA on its Reignmakers NFT/DFS contest hybrid. According to the NFLPA, it agreed to rework the contract in 2023 when DraftKings said it would stop selling NFTs.
In the lawsuit, the NFLPA contended that the new agreement permitted DraftKings to cancel the deal if a court determined that NFTs were securities, rather than simply digital collectibles. In a separate 2023 lawsuit, a judge said that NFTs could be securities, leading to DraftKings shuttering its NFT business and ending its contract with the NFLPA.
The NFLPA took umbrage at this action, pointing out that the judge did not say NFTs were securities, just that they might be. Thus, DraftKings broke its contract with the union.
“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 lawsuit stated. “Buyers’ remorse, however, is not a basis to terminate a contract.”