Collector sues Nifty Gateway over Beeple auction
Art collector Amir Soleymani is caught in a legal dispute between digital art/NFT online auction platform Nifty Gateway. He refused to pay $650,000 for a third edition Bepple artwork titled “Abundance”, which he thought was a losing bid. Bepple, who managed to set the NFT art world ablaze with his $69 million sale of “Everydays: the First 5000 Days” at Christie’s in March, did the auction for “Abundance” back in May.
Soleymani lost out to Ethereum co-founder Taylor Gerring’s bid of $1.2 million for the digital artwork's first edition. However, Soleymani has no idea that the “Abundance” sale was a ranked auction, even though it had been labeled as such on the auction page. This means that he and the 98 other top bidders were expected to accept editions of the artwork for the price of their top bid.
“Imagine bidding to win an item, ending up in second place and getting almost the same thing the third bidder gets but with a significant difference in bid amount,” Soleymani stated. “This method of auction maximises revenue for the platform and artists but is damaging to collectors,” he added.
As he refused to pay, Nifty Gateway then froze his account and blocked his access to around 106 NFTs he had purchased, worth hundreds of thousands of dollars. Soleymani then decided to instigate legal proceedings in both the UK and US, where the major NFT platform is based.
He placed a bid on the piece “with the intention of acquiring the original artwork offered for sale in the Abundance Auction and not the third or any other edition thereof,” Soleymani’s complaint claims. He also mentioned that the ranked auction format’s terms are “unfair and do not bind him”. In addition, he requested payment of any legal fees.
In his correspondence with ARTnews, he wrote, “Ranked Auction was written but the case is more about whether the NG’s [Nifty Gateway’s] Terms are enforceable/binding upon me. I have not previously encountered such an auction which NG seems to have uniquely used for the Abundance NFT.”