NFT Win

from artnet

A U.S. Court Has Handed a Legal Victory to Digital Artist Kevin McCoy in an Ownership Challenge Over the First-Ever NFT

The judge called the lawsuit an attempt to ‘exploit’ questions of open ownership.

by Eileen Kinsella

[image error]Kevin McCoy, Quantum (2014). Image courtesy Sotheby’s.

Kevin McCoy, the artist who is widely credited with creating the first NFT, and auction house Sotheby’s have won a legal victory in a lawsuit that challenged the terms and propriety of a 2021 sale at which the token sold for $1.47 million.

U.S. Magistrate Judge James L. Cott dismissed a lawsuit, in a detailed 43-page decision issued March 17 that marks one of the first important tests surrounding NFT ownership and is likely to set a precedent going forward.

The plaintiff in the case, filed in U.S. District Court, Southern District of New York was anonymous and sued through Free Holdings, a Canadian holding company. The claims centered on the fact that McCoy, in 2014, had created Quantum, his first NFT, using a blockchain known as Namecoin. McCoy later chose to preserve his original metadata using a token on a different and more modern blockchain, Ethereum. McCoy’s sale of Quantum at Sotheby’s in 2021 included the Ethereum token.

“Roughly a month before the sale, Free Holdings created a new NFT on the Namecoin blockchain, using the same namespace that McCoy had used seven years earlier and duplicating McCoy’s original metadata. Free Holdings then alleged that it was actually the owner of the ‘first-ever NFT,’” according to a statement shared with Artnet News from McCoy’s attorneys at Pryor Cashman.

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