OpenSea is passing through rather troubled waters as it faces a lawsuit over its stolen NFT policy. The lawsuit was filed by Jesse Halfon, an attorney for NFTs and DAOs. Users have long been chagrined by the platform’s rather exasperating policy of dealing with stolen NFTs, and it seems like the discontent has reached a tip-off point. With the lawsuit looming large, OpenSea will probably have to reconsider its way of doing things. Read along to know more.
The What and Why
NFTs, although quite popular come with their own set of complications and controversies. You can only imagine the degree of complications that stolen NFTs come with. A lawsuit was filed against OpenSea, the NFT marketplace by attorney Jesse Halfon over its policy of dealing with NFTs that are reported to be ‘stolen.’ This policy of OpenSea has been causing widespread discontent among its users, and quite a couple of times it has come under the shadow of scrutiny.
According to the terms of the policy, the sale of stolen NFTs is not allowed on the OpenSea platform. However, the policy also means that users are not allowed to sell the NFTs as they are locked. This is because the previous owners report their NFTs as stolen due to which they get locked. This causes trouble for the current owners as they are unable to sell their NFTs despite having no part in the theft. The lawsuit was filed through the small claims court. The lawsuit might turn into a class action lawsuit if more users join. However, according to the terms of OpenSea,
“All claims and disputes within the scope of the arbitration agreement must be arbitrated on an individual basis and not on a representative or collective class basis.” This puts a possible ban on a class action lawsuit. However, Halfon is hopeful. He stated that although the terms add difficulties for a class action lawsuit, it is not entirely impossible.
