Bored Ape owner sues OpenSea in a US$ 1million lawsuit over ‘stolen’ NFT

The Texas-based victim filed the lawsuit in a U.S federal court late last week.
February 22, 2022 - Tom Peters

Following the recent OpenSea inactive listing exploit, its victim and now former Bored Ape Yacht Club owner Timothy McKimmy, has taken the NFT marketplace to court. McKimmy is demanding a return in ownership of the Bored Ape NFT or a settlement of more than US$1 million.

 

The exploit is one of several issues OpenSea had to deal with at the beginning of this year whereby hackers targeted “inactive NFT listings,” buying these NFTs for just 0.01ETH, a tiny fraction of their original price. 

 

‘Hacked’ Bored Ape NFT

 

In McKimmy’s case, his Bored Ape acquired from one of the most expensive NFT collections – was automatically sold for 0.01 ETH to the hacker and resold for 99 ETH immediately against the collection’s floor price of 91.5 ETH. 

 

Timothy McKimmy filed a complaint in a Texas high court claiming he did not list his Bored Ape #3475 for sale and that it was “stolen.”

Allegedly, the Bored Ape #3475 is in the top 14th percentile in terms of rarity, and McKimmy claims it to be even rarer than Justin Bieber’s Bored Ape, which Bieber had acquired for US$ 1.3 million. 

 

McKimmy’s complaint states that “instead of shutting down its platform to address and rectify these security issues, Defendant (OpenSea) continued to operate. Defendant risked the security of its users’ NFTs and digital vaults to continue collecting 2.5% of every transaction uninterrupted.”

 

He further emphasized his attempt at reaching out to OpenSea multiple times to resolve the issue but to no avail.

 

This would be the first lawsuit of this manner against OpenSea or any NFT marketplace in general. 

 

OpenSea in Hot Waters

 

Although OpenSea still enjoyed success this year (reaching an all-time high monthly trading volume in January), the global NFT marketplace has had to deal with a lot of issues in recent months.

 

In January, OpenSea spent about US$1.8 million in refunding other victims who sold their expensive NFTs at discounted prices. There have also been reports about OpenSea meeting these users privately and offering floor price value – the least possible cost in an NFT collection – if they can accept a non-disclosure agreement.

 

There was also a legal issue with Larva Labs concerning a copycat project, ‘CryptoPunks V1,’ on the platform which resulted in the delisting of the famous CryptoPunks collection from Open Sea. 

 

Now, OpenSea is still investigating a recent phishing attack from two days ago that cost several users US$1.7 million in stolen NFTs.

 

Whether these recent problems will topple OpenSea as the world’s leading NFT marketplace is still to be determined, but it is already starting to lose users’ trust.

 

Photo: Bored Ape Yacht Club

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