DraftKings settles NFLPA lawsuit over NFT payments

DraftKings has reached a settlement with the National Football League Players Association (NFLPA) regarding a lawsuit over unpaid fees for the use of NFL player likenesses in non-fungible tokens (NFTs).

The agreement was announced in a joint letter to Judge Analisa Torres on January 27, 2025, where both parties confirmed they had mediated the suit and reached a settlement in principle.

They requested a 60-day stay of the lawsuit to allow time to finalise the details, extending the deadline to March 28.  

The specifics of the settlement have not been publicly disclosed.

The lawsuit originated after DraftKings closed its NFT marketplace in July 2024 and stopped making payments to the NFLPA under their contract.

DraftKings claimed it had the right to terminate the agreement following a federal court ruling that classified NFTs as securities.

In August 2024, the NFLPA filed suit against DraftKings, reportedly seeking around $65 million in damages, although the exact amount sought was redacted from court documents.

The NFLPA also alleged that DraftKings threatened to cease offering NFTs in 2023, which led to discussions about restructuring their contract.

This proposed settlement comes just weeks before the NFL's Super Bowl, scheduled for February 9, an event that has previously featured numerous crypto advertisements prior to the collapse of FTX (CRYPTO:FTT) in late 2022.

While NFT sales saw a slight year-on-year increase of 2.3% to $8.9 billion in 2024, this figure remains significantly lower than the peak of $23.7 billion recorded in 2022.

As both parties work towards finalising their agreement, this settlement may clarify future rights regarding player likenesses and NFT usage within professional sports.