Following a federal judge’s decision to allow a lawsuit against Dapper Labs’ NBA Top Shot Non-Fungible Tokens (NFTs) to proceed, the Blockchain Association’s legal director stated that “it would be absurd” for a US court to rule that digital assets in private blockchains they are values. This statement was made in response to the judge’s decision to allow the lawsuit to proceed.

US lawyer Jake Chervinsky issued a statement after a federal court rejected a move to dismiss a 2021 lawsuit that claimed Dapper Labs traded NFTs as unregistered securities. The ruling prompted comments from Chervinsky.

Chervinsky was one of several lawyers who posted on Twitter to repeat that the judge’s rejection of the motion does not indicate a decision on the complaint has been made; rather, he merely indicates that the claim was “facially plausible.”

“The judge made no decision at all. Because the securities allegations were at least “plausible,” an extremely low standard, and not a final determination, he allowed the case to go beyond a request for dismissal. He noted that this decision was not a final judgment at all.

“Putting this debate aside for a moment, it would be completely ridiculous if every valuable digital object held in centralized databases was a security.”

According to his explanation, this would force all major video game producers, event ticketing sites, travel rewards programs, etc. to become publicly traded companies subject to SEC regulation.

Jesse Hynes, an additional attorney in the United States, weighed in on the move in a tweet on February 22. He said motions to dismiss are “rarely successful” due to the fact that the plaintiff only has to plead sufficient evidence for the case to proceed.

“The court concluded in the Dapper case that the plaintiff presented sufficient evidence to show that IF ALL THE ALLEGATIONS ARE TRUE, then there is a violation of values,” the judge said.

“Now we enter the discovery phase where we seek to find out what the real facts are. The lawyer went on to say that once it’s over, Dapper will most likely file a motion for summary judgment.

Charges that Dapper Labs distributed NBA Top Shot Moments NFTs on a private blockchain were a “pivotal” component to the court’s decision to deny the motion to dismiss, according to another US attorney named James Murphy. , also known as “MetaLawMan”.

As a result of this, MetaLawMan proposed that XRP (XRP) being issued on a public blockchain “could be considered a net positive” for Ripple in its case against the US Securities and Exchange Commission ( SEC). This was triggered by the fact that this “could be considered a net positive” for Ripple.

Plaintiff Jeeun Friel initiated the class action lawsuit against Dapper Labs in May 2021. In the lawsuit, Ms. Friel said that the defendant offered NFTs as unregistered securities.

On February 22, Judge Marreo ruled against the plaintiff’s request to dismiss the lawsuit. She said that the method through which Dapper Labs provides the NFTs has the ability to establish a proper legal connection between the investors and themselves, which meets the investment contract conditions outlined in the Howey test. This is the case because the Howey test was developed.

However, since Marreo said that not all NFTs would constitute securities and that each case will need to be evaluated on a case-by-case basis, it is highly doubtful that the final outcome of this case would set a precedent for NFTs.

In the 15 minutes after the termination, the price of the Flow (FLOW) token issued by Dapper Labs fell 6.4%, from $1.24 to $1.16. According to CoinGecko, the FLOW token has recently made a comeback and is now trading at $1.29.