According to a recent Bloomberg Law article [subscription required], in the past year there has been a sharp decline in active civil suits against cryptocurrency exchanges, digital wallet, mobile phone providers and others involving claims related to crypto hacking incidents or cybertheft, due, in part, to increased security protocols and
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App Store Protected by CDA Immunity (and Limitation of Liability) for Losses from Fraudulent Crypto Wallet App
By Jeffrey Neuburger on
Background
The issue of fraudulent crypto-related mobile apps has received much attention of late. Back in July 2022, the FBI issued a notice, warning financial institutions and investors about instances where criminals created spoofed cryptocurrency wallet apps to trick consumers and steal their cryptocurrency. There have also been reports of phishing websites that attempt to trick consumers into entering credentials, thereby enabling hackers to access victims’ crypto wallets. In response to these developments, Senator Sherrod Brown recently sent a letter to Apple, among others, expressing his concern about fraudulent cryptocurrency apps and asking for more information about the particulars of Apple’s process to review and approve crypto apps for inclusion in the App Store.
In a recent ruling, a California district court held that Apple, as operator of that App Store, was protected from liability for losses resulting from that type of fraudulent activity. (Diep v. Apple Inc., No. 21-10063 (N.D. Cal. Sept. 2, 2022)). This case is important in that, in a motion to dismiss, a platform provider was able to use both statutory and contractual protections to avoid liability for the acts of third party cyber criminals.
Roots of Confusion Over “v1” CryptoPunks NFTs Raise Key Copyright and Practical Considerations for NFT Minters, Acquirers and Platform Operators
By Wai Choy & Kyle Hansen on
Minters of collectible non-fungible tokens (NFTs) have taken a wide range of approaches. In addition to variations in the means of distribution, token standards, governing smart contracts and platforms on which initial sales or transfers are made, the terms, conditions and content licenses (or lack thereof) under which users take possession of an NFT often differ from project to project. The recent delisting by OpenSea of the original (or “v1”) version of the popular “CryptoPunks” NFT art collection in light of a takedown notice issued pursuant to the Digital Millennium Copyright Act (DMCA) by the collection’s creator, Larva Labs, and the ensuing DMCA counter-notification by v1 owners, illustrates some of the challenges that can result from the absence of clear written legal terms governing an NFT distribution.