Federal Judge Approves Service of Court Papers Through NFTs

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  • A U.S. federal judge has allowed a plaintiff to serve court papers to the accused via NFTs
  • The plaintiff took anonymous hackers to court demanding a return of close to $1 million in USDT
  • The judge said the plaintiff should use the same wallet address the hackers used

U.S. federal judge Beth Bloom has allowed plaintiff Rangan Bandyopadhyay to serve court papers to the accused via NFTs in a case where the accused are hackers who drained close to $1 million USDT from the plaintiff’s wallet. The judge said that the plaintiff should use the same wallet address used by the hackers, with court filings indicating that the malicious actor stole  971 USDT. The court ordered the hackers to return the amount in full, adding that unpaid funds will continue to attract interest until the debt is fully settled.

NFTs form Legal Notice

Details indicate that the malicious actors tricked Bandyopadhyay into interacting with a compromised smart contract using their Coinbase wallet, allowing the hackers full access to the plaintiff’s USDT stash. According to Bloom, digital collectibles are an acceptable legal notice in such circumstances since the hackers, as of now, has no known physical address.

However, with the decentralized nature of the blockchain, it’s unclear how the funds will be recovered even with a court order. Bandyopadhyay’s attorney hinted at “knowing where the crypto is sitting,” adding that they’re confident they’ll get part, if not all, of the funds. Bloom’s ruling resembles a similar one delivered by a U.K judge who said that plaintiffs can serve court papers through NFTs if the recipient’s known address is a crypto address.

Rafael Yakobi, Managing Partner of The Crypto Lawyers, who represented the plaintiff, told FullyCrypto:

“We are proud to be the first firm to get a federal court to authorize service by NFT, and hope that this contributes to the ongoing battle against crypto scams.”

A Crypto Scam Tracker

Although security agencies like the FBI have in the past retrieved stolen crypto, the scammers are now targeting NFT collectors with their usual hard-to-resist deals. Some jurisdictions have however launched a crypto scam tracker to help people determine whether an available cryptocurrency deal is a scam.

Despite Bandyopadhyay’s stolen funds being close to $1 million in value, it’s unlikely the court will offer technical assistance in recovering them.