Judge dismisses $1.47M Quantum lawsuit against artist who minted first NFT
A federal judge threw out the case against the artist who coined the pioneer NFT because the plaintiff tried to explore indistinguishable legal areas relating to NFT ownership.
Quantum NFT ownership
According to UPI records, Free Holdings, a Canadian company, had filed charges against an artist who had created the first NFT. However, the judge presiding over the case dismissed it, citing insufficient evidence.
In collaboration with Jennifer McCoy, Kevin McCoy generated the first non-fungible token (NFT), Quantum, and sold it at $1.47 million in 2021 in an auction by Sotheby.
Free Holdings based its case on ownership, citing that McCoy minted the NFT using the Namecoin blockchain, a cryptocurrency platform that came into the limelight in 2011 after splitting from Bitcoin.
The blockchain mandated users to preserve their archives every seven months, but the company claimed McCoy failed to comply.
“McCoy left the archives containing Quantum to expire,” said Free Holdings. According to the company, the actions by McCoy left the Quantum Namecoin claimable. Therefore, Free Holding, through a cryptocurrency wallet, claimed the record in early April 2021.
Free Holdings asserted that Quantum ownership changed hands when they purchased the registration.
However, when minting on the Ethereum blockchain, McCoy indicated that the original records for the digital artwork were destroyed when the contract with Namecoin elapsed.
Judge dismisses case
Judge James Cott of the New York Southern District federal court dismissed the allegations made by Free Holdings last week. The judge indicated the petitioner’s claims pursued grey areas in NFT ownership laws.
The judge added that the prayers by Free Holdings did not go further than a shot to trying to exploit unclear dimensions relating to ownership in the NFT sector, which is still developing. According to the judge, Free Holding was using the lacuna in law to lay hands on profits made by an authentic artist.
NFT ownership puzzle
The landmark ruling comes at a time when many artists are facing lawsuits relating to NFT ownership. The Kevin McCoy case is among the many NFT-related cases, and the ruling acts as a breather to many aggrieved parties in the growing NFT industry.
