Soleymani v Nifty Gateway: A Worrying step in the wrong direction for NFTs?

Emily Wigoder
/ June 22


The High Court’s judgment in Amir Soleymani v Nifty Gateway LLC is a bold step in the law of cryptoassets and NFTs. This case is the first to concern NFTs, but is arguably a concerning one for NFT purchasers, as the courts have sided with a large platform over a small consumer in this case. It was held that a ‘decentralised and borderless’ NFT auction could not be subject to English consumer protection legislation. Cases like these emphasise the value of partnering with a boutique which offers legal protection such as Ad Astra for your offering.

What were the facts of the case?

Mr Soleymani (the Claimant), a notable Liverpool-based NFT collector under his alias ‘Mondoir’, took part in an NFT auction held on the online platform of Nifty Gateway (‘Nifty’) (the Defendant), a prominent US NFT platform. In order to use the platform and place bids, the Claimant had to sign up to Nifty’s Terms of Use.

The Terms of Use provided that (1) by agreeing to them one also agreed to resolve all disputes with Nifty through arbitration held in New York; and (2) the Terms of Use shall be subject to the laws of the State of New York (the ‘Governing Law Clause’). In the auction Mr Soleymani placed a bid for an NFT associated with an artwork by Beeple. He placed the second highest bid, and thus Nifty informed Mr Soleymani that he had been among the highest 100 bidders and therefore a ‘winner’ in the action. They refused to give him his money back, and instead he was awarded a ‘second edition’ of the same Beeple he had bid for. Mr Soleymani claimed he was unaware of the non-traditional rules of the auction. There was a dispute as to whether Mr Soleymani was liable to pay the sum of the Bid.

What claim was brought before the English courts?

Alongside the New York arbitration, Mr Soleymani brought a claim before the English courts, seeking a declaration that the arbitration agreement in Nifty Gateway’s terms of use was unenforceable because it was unfair under the form of the Consumer Rights Act 2015.

What was the judgment?

The court upheld Nifty Gateway’s challenge, dismissing Mr Soleymani’s claims. The Court rejected Mr Soleymani’s argument that the subject-matter of the claims was “consumer rights” rather than “arbitration”. The court further held, that while Mr Soleymani was entitled to raise English consumer protection issues under the Arbitration Act 1996, it was not suitable legislation to deal with the question of “fairness”. Issues regarding the validity of the arbitration agreement, including questions of the fairness of the terms of use, were more properly dealt with by the arbitral tribunal. The consumer rights issues raised by Mr Soleymani would require the English court to make factual findings that overlapped with the substance of the dispute and so were properly within the arbitral tribunal’s jurisdiction. The relevance of English consumer protection law was disputed given that the terms were governed by New York law. Thus, the claim was dismissed.


The case is concerning for consumers of NFTs, who seem to have little recourse for auctions that they consider ‘unfair’. It will be interesting to see where NFT case law goes, as the court in this case did not deny that NFT sales could be protected under consumer protection law, but merely that this was superseded in this case by the arbitration agreement. This case not only highlights the necessity of reading the terms of use of an individual platform, but the importance in this space of partnering with platforms which aim to protect your consumer rights. Ad Astra is a platform which puts consumers and creators first, and our dedicated legal team is on hand to ensure your rights are protected.

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