NFTs
Dolce & Gabbana class action lawsuit alleges brand sold ‘useless’ NFTs
Dolce & Gabbana Class Action Overview:
- Who: Plaintiff Luke Brown has filed a class action lawsuit against Dolce & Gabbana.
- Why: Dolce & Gabbana sold Non-Fungible Tokens with promises of benefits that were never realized by the buyers.
- Where: The Dolce & Gabbana class action lawsuit was filed in New York federal court.
A customer has filed a class-action lawsuit against Dolce & Gabbana over allegations that the company’s Non-Fungible Tokens (NFTs) came with promises of benefits that were never realized by buyers.
Dolce & Gabbana created DGFamily to sell NFTs with a suite of benefits, including digital wearables for the Metaverse, physical apparel, and live events for multi-box buyers.
“Whether due to reckless incompetence or greed, the defendants failed to deliver what they promised in exchange for purchasing their digital assets and abandoned their crypto project, retaining more than $25 million used to finance the project,” the lawsuit says .
Plaintiff Luke Brown’s lawsuit calls the NFT sale a “fraudulent and manipulative scheme” that enriched DGFamily following “false and materially misleading statements” about the value and benefits of purchasing NFTs.
Lawsuit: DGFamily’s NFT Sales Were Illegal and Unauthorized Solicitations
Dolce & Gabbana and DGFamily were not registered to sell securities, meaning they made illegal solicitations and offers in violation of the Securities Act of 1933.
Title protections are in place to ensure that sellers do not omit pertinent information. Without these protections, the securities could be offered without any disclosure, the suit says.
DGFamily sold the NFTs to cryptocurrency buyers, which DGFamily then transferred to wallets controlled by it and Dolce & Gabbana.
“Defendants’ public offering and sale of DGFamily products was an unlawful offering of unregistered securities for which no exemption from registration was available under the Securities Act,” the lawsuit says.
Stoner Cats 2 LLC was fined US$1 million in September 2023, after selling $8.2 million worth of non-fungible tokens (NFTs) that were considered securities without registering the sale with the United States Securities and Exchange Commission.
Have you purchased a Dolce & Gabbana NFT? Let us know in the comments.
The plaintiff is represented by Alex P. Clavering, of counsel with Jarrett L. Ellzey, Leigh S. Montgomery and Alexander G. Kykta of Ellzey & Associates PLLC.
O Dolce & Gabbana class action It is Brown v. Dolce & Gabbana USA Inc., et al.., Case No. 1:24-cv-03807, in the U.S. District Court for the Southern District of New York.
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