An NFT of Jay-Z’s first album has sparked a record label lawsuit

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An NFT of Jay-Z’s first album has sparked a record label lawsuit
It’s one of the first big lawsuits over an NFT
It’s one of the first big lawsuits over an NFT
by
Adi Robertson
Jun 21, 2021, 6:55 PM UTC
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Photo by James Devaney/Getty Images
Adi Robertson
is a senior tech and policy editor focused on online platforms and free expression. Adi has covered virtual and augmented reality, the history of computing, and more for The Verge since 2011.
Roc-A-Fella Records (RAF), co-founded by hip-hop mogul Jay-Z, has sued fellow co-founder Damon Dash for allegedly hawking a non-fungible token of Jay-Z’s 1996 debut album
Reasonable Doubt
.
The lawsuit claims
Dash partnered with platform SuperFarm to auction an NFT of
Reasonable Doubt
, following a well-trodden path of
selling art ownership via NFT
. It quotes a purported SuperFarm press release calling the sale “one of the most significant NFT auctions to date,” since it would transfer “the rights to all future revenue generated by the album from Damon Dash to the auction winner.” That’s an
unusually sweeping promise
for an NFT. “Selling the copyright to Jay-Z’s
Reasonable Doubt
as an NFT is a groundbreaking landmark — both for the crypto space and the broader music industry,” the statement apparently continued.
But Roc-A-Fella’s lawyers say this wasn’t Dash’s product to advertise. Dash owns a minority share in RAF, but the suit says that gives him “no right to sell a company asset” as an NFT or otherwise. SuperFarm canceled the auction at RAF’s request, but the label claims Dash is trying to find a substitute venue. RAF wants Dash to hand over any NFTs he’s minted based on
Reasonable Doubt
, plus monetary damages. “There is only one
Reasonable Doubt
— the rights to it are irreplaceable,” the complaint notes. “The bottom line is simple: Dash can’t sell what he doesn’t own.”
What’s an NFT?
NFTs allow you to buy and sell ownership of unique digital items and keep track of who owns them using
the blockchain
. NFT stands for “non-fungible token,” and it can technically contain anything digital, including drawings, animated GIFs, songs, or items in video games. An NFT can either be one of a kind, like a real-life painting, or one copy of many, like trading cards, but the blockchain keeps track of who has ownership of the file.
NFTs have been making headlines lately, some selling for millions of dollars, with high-profile memes like
Nyan Cat
and the
“deal with it” sunglasses
being put up for auction. There’s also a lot of discussion about the massive electricity use and
environmental impacts
of NFTs. If you (understandably) still have questions, you can read through
our NFT FAQ
.
According to
TMZ
, which first reported the lawsuit, Dash has called the lawsuit inaccurate — saying he’s trying to sell his share in RAF rather than the album itself. “Under the terms of the deal with a potential buyer, the buyer would buy my share of Roc-a-Fella Records and Jay-Z will have exclusive administration rights” to the album, he told
TMZ
. Dash also
told the
New York Post
’s
Page Six
that “I’m not running around to different places trying to auction off
Reasonable Doubt
. I’ve been working with one platform and that’s SuperFarm.” He called the suit a scare tactic intended to make him sell his stake in the company.
The case is unrelated to another recent lawsuit where
Jay-Z accused
Reasonable Doubt
cover photographer
Jonathan Mannion of exploiting his likeness.
As NFTs have blown up in popularity, related lawsuits are starting to
appear in court
. This suit seemingly hinges on the nebulous description of Dash’s NFT. You can parse SuperFarm’s alleged product description to fit Dash’s claim, for instance: if you buy this NFT, you’ll get any revenue that
Dash himself
would have earned from the album copyright. But you can also interpret it as a full-fledged sale of the copyright, and the press release’s title promotes an “auction for Jay-Z’s iconic album
Reasonable Doubt
.” In any case, NFTs are supposed to confer a sense of airtight ownership and exclusivity — and auctioning off a partial stake in an iconic album doesn’t have quite the same ring to it.
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