As expected, DraftKings has filed a motion to dismiss the New York Southern District Court lawsuit brough against it by the NFL Players Association (NFLPA).
The NFLPA claimed that DraftKings violated the terms of an agreement between the two groups to license player images for products in DraftKings’ NFT Marketplace. DraftKings, however, contends that the termination of its deal with the group “exceeds the limitation of liability”.
In the motion, DraftKings argued that it did not intentionally harm the NFLPA, which is necessary for the company to be in violation of the agreement.
“As New York courts have repeatedly held, ‘acting out of self-interest alone precludes a finding of bad faith or intentional wrongdoing,'” DraftKings argued.
As DraftKings argued in previous court documents, the changing legal landscape around NFTs and the interpretation of whether or not they are a regulated security. At the heart of this uncertainty is a pending class action lawsuit, Dufoe vs. DraftKings, which continues to move forward after a judge denied a motion by DraftKings to dismiss.
“This dramatic change in legal and regulatory risk—the Dufoe decision, the regulatory subpoenas to DraftKings, and the growing number of other regulators and courts that made or accepted claims that certain NFTs are securities—made it materially impracticable for DraftKings to benefit from the rights granted under the Agreement,” the motion read.
The NFLPA claims that DraftKings owes them more than $60 million for terminating the contract, which it did in the wake of closing down NFT Marketplace entirely back in August.
In its initial claim, the NFLPA said that a judge denying a motion to dismiss is not tantamount to a government changing its stance on the legality of NFTs. DraftKings has said in documents that state regulators have also subpoenaed the group about the product, but did not disclose which groups have reached out.
