NFLPA Sues DraftKings for $65 Million Over Failed NFT Deal

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.

The NFL Players Association (NFLPA) has filed a federal lawsuit against DraftKings over an alleged breach of contract related to a failed NFT (non-fungible tokens) deal.

The lawsuit, filed in the Southern District of New York on Monday, seeks $65 million in damages from the fantasy sports and gaming company, according to Front Office Sports.

The complaint alleges that DraftKings breached its licensing agreement with the NFLPA by closing down its NFT marketplace in July and terminating the deal with the union on July 29.

DraftKings closed its NFT marketplace in July “due to recent legal developments,” according to a statement at the time.

However, the NFLPA claims in its lawsuit that DraftKings still owes the union money for the use of players' NIL (name, image, and likeness) in its NFT marketplace.

The lawsuit also alleges that DraftKings is currently 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, and the complaint alleges that the agreement was set to expire in 2025.

During that time, the lawsuit claims, five DraftKings’ executives earned an income totaling approximately $261.1 million, according to NFLPA calculations.

“The total compensation of just these five aforementioned officers since 2021 is approximately quadruple of what DraftKings owes the NFLPA Licensors,” the complaint states.

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 by Visual Capitalist revealed that despite warnings from people like Bill Gates, over 23 million people own a NFT investment that is now worthless.

Another report published by Visual Capitalist in September 2023, stated that 95% of all NFTs have a value of zero dollars.

Meanwhile, in August 2021, NFTs had nearly $2.8 billion in monthly trading volume, according to NonFungible.com data cited by Visual Capitalist.

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.

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