DraftKings has settled the NFL player union lawsuit which alleged the company was ducking out of its NFT payment obligations.
DraftKings has settled the NFL player union lawsuit which alleged the company was ducking out of its NFT payment obligations.
The NFL Players Association (NFLPA) and DraftKings have reached a non-binding settlement, subject to a formal definitive settlement agreement, according to a letter addressed to the judge in the case.
The lawsuit stemmed from the fallout from the shuttering of DraftKings’ Reignmakers NFT product, which had involved licensing the rights to all 2,000+ NFL players in 2021.
Despite an initial NFT boom in 2021, interest in the digital products waned over time resulting in an eventual steep fall in prices.
The NFLPA accused DraftKings of welching on the deal last August, while the operator said legal challenges had forced the closure of the brand.
Union said DraftKings had ‘buyer’s remorse’
The union had claimed the business had “buyer’s remorse”. It added it had agreed to restructure the deal in April 2023 to accommodate DraftKings.
The two parties requested a 60-day stay in the lawsuit until 28 March to enable them time to finalise the deal.
While the amount owed by the company has not been publicly revealed, the NFLPA original complaint suggests the total was in the region of $65m.
The complaint said: “At the end of the day, and despite DraftKings” best efforts to muddy the waters, this case is extraordinarily simple.
“DraftKings inability to profitably commercialise the intellectual property it licensed does not excuse performance, and DraftKings must pay what is due.”
For its own part, the operator had highlighted a section of the contract that had allowed it to escape payments if a government body ruled the NFT products were securities.
The denial of DraftKings’ Motion to Dismiss a case alleging its NFT products where unregistered securities was highlighted by the business as proof this had occurred, a point which was disputed by the NFLPA.
NEXT.io has contacted the NFLPA for comment.