Credit: Rawpixel.com/Adobe Stock SEC Obtains $750K Settlement From 'World's First NFT Restaurant'
"The line between innovation and a potential securities violation remains murky," said Helen Gugel, a partner at Am Law 10 firm Ropes & Gray who is not involved in the matter.
September 17, 2024 at 11:57 AM
4 minute read
What You Need to Know
- Flyfish Club LLC sold NFTs at two price points and generated gross proceeds of approximately $14.8 million.
- The U.S. Securities and Exchange Commission obtained a $750,000 settlement from the company.
- An expert advised an alternative method for similar businesses to avoid SEC scrutiny.
The U.S. Securities and Exchange Commission obtained a $750,000 settlement from Flyfish Club LLC over its offer and sale of securities through the form of non-fungible tokens, a unique digital identifier on the blockchain used to certify ownership.
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Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
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