- OpenSea users who had sued the NFT marketplace have dropped the suit
- The users will now argue their case through arbitration
- The users had accused OpenSea of dealing in unregistered securities
Two months after they sued OpenSea for allegedly dealing in unregistered securities, Anthony Shnayderman and Itai Bronshtein have dropped the case. OpenSea told the court that the two disgruntled users failed to honor the terms and conditions they had signed when they joined the platform. According to the NFT marketplace, users must engage in the arbitration process before going to court, which reduces the number of lawsuits from unhappy users.
“No Other Choice,” Say Claimaints
The two OpenSea users, through their lawyer, The Moskowitz Law Firm, wrote to the court dismissing the lawsuit shortly after a Florida court granted the NFT marketplace’s request to handle their grievances through arbitration.
In its court filing last month, OpenSea said that the users signed the terms of use stating, among other things, that all user concerns must go through arbitration. According to Shnayderman and Bronshtein’s lawyer, the NFT marketplace left them no choice but to drop the suit.
Speaking to Cointelegraph, Adam Moskowitz said that the case was meant to align OpenSea to the global audience and adapt it to the evolving “political and legislative changes.” He added that he believes that the NFT marketplace is responsible for NFTs traded on the platform.
OpenSea Is “Ready To Stand Up and Fight”
Shnayderman and Bronshtein went to court in September claiming that the NFT exchange offered illegal and valueless collectibles. The two argued that the platform didn’t put all of its NFTs to the Howey test to ascertain whether they were securities.
OpenSea responded to the claims saying that the two based their suit on a disclosure by the marketplace that it had received a Wells notice from the SEC. The marketplace’s CEO Devin Finzer previously disclosed that he was shocked by the SEC’s intentions, adding that the platform is “ready to stand up and fight.”
With Shnayderman and Bronshtein forced into arbitration, it may motivate other NFT and crypto platforms to add an arbitration clause on their terms of use to avoid being sued by users.
