The lawsuit against the luxury brand NFT project was dismissed, allowing the US subsidiary to avoid legal liability.

Recently, a class action lawsuit against the American branch of a well-known luxury brand was dismissed by a federal judge. The lawsuit stemmed from an NFT project called "DGFamily," with the plaintiffs accusing the project of fraudulent activities.

This NFT project promises to offer digital and physical luxury goods, as well as opportunities to participate in offline events. The project is divided into eight phases and has raised over $25 million. However, after completing the delivery of the first two phases, the project suddenly ceased operations.

Although the U.S. subsidiary shares branding with its Italian parent company and has some overlapping executives, Judge Naomi Reice Buchwald found that the evidence provided by the plaintiffs was insufficient to demonstrate that the U.S. subsidiary had "substantial control" over the NFT project. According to the evidence presented by the plaintiffs, the smart contract deployment, marketing decisions, and rights redemption for the NFT project were all independently handled by the Italian team. The U.S. subsidiary only provided routine local compliance support throughout the process.

The judge stated that the level of participation did not meet the "substantial control" standard set by New York state law, and therefore the U.S. subsidiary cannot be held jointly liable. This ruling means that even if the parent company may be responsible for the NFT project, its U.S. subsidiary has temporarily avoided legal liability.

This case has once again drawn attention to the risk management of NFT projects, especially regarding how to define the legal responsibilities of each entity under multinational corporate structures. At the same time, it has sounded the alarm for investors, reminding everyone to be more cautious when participating in emerging digital asset projects.