Late last year, Pepe the Frog creator Matt Furie decided to run an NFT auction, selling off an image of the controversial character in which it was waist-deep in a pool, its ass-crack peeping over the surface. Everything that has happened since is exactly how you would imagine such an auction in the insipid Web3 space would go down.
Furie—who tried to “reclaim” the character in 2017 after it had become co-opted as a symbol of the far right—had formed a Decentralized Autonomous Organization, or DAO called PegzDAO. On October 8 he auctioned off a single NFT representing the image above. At the same time, he reportedly stated that aside from the one being auctioned, there would be 99 more NFTs representing the same image, made and kept in the DAO’s possession and never put up for sale.
As Web3 Is Going Just Great reports, a man by the name of Halston Thayer went on to win the auction, spending the cryptocurrency equivalent of $537,084. He was no doubt thrilled with his unique purchase, until a couple of weeks later when PegzDAO released 46 of those other 99 NFTS—which, remember, represent the exact same image as the one Thayer paid half a million dollars for—for free.
As first posted by lawyer Rob Freund, Thayer has now decided to sue Furie and his associated companies, claiming that the free release “significantly devalu[ed] Plaintiff’s Pepe NFT to less than $30,000.” Considering we’re talking about an utterly worthless image that you are all free to right click and save for yourselves here, this is one of the funniest sentences I have ever read. The suit opens with:
This action arises from Defendants’ unlawful, unfair, and fraudulent business practices, which includes their unfair, deceptive, untrue, and misleading advertising and wrongful actions with respect to an auction for a particular nonfungible token (“NFT”) that led Plaintiff and others to grossly overbid on the NFT. Plaintiff therefore brings this action for fraudulent inducement, intentional and negligent misrepresentation, unfair competition and unlawful business acts and practices, breach of contract, breach of the implied covenant of good faith and fair dealing, and unjust enrichment.
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Thayer is seeking to have the full price of his original “investment” returned, as well as “punitive damages”.