Online marketplace WhatNot is the latest platform to face legal challenges due to live-streaming the sale of trading cards in a format called breaking. Sports Illustrated reported today that a user filed an arbitration complaint against Whatnot, Inc. “specifically challenging the legality of the randomized breaks and repackaged products.”
For those unfamiliar with the concept of “breaking,” Topps’ definition begins: “Breaking refers to the practice of opening multiple boxes or cases of a product at the same time, and then distributing the cards to a larger group of paying customers. Breakers sell “slots” to their breaks, and customers receive a defined portion of the opened product” – see more on the Topps.com website.
Topps also notes that breakers “operate websites and often stream their breaks on social media platforms” and that “it isn’t uncommon for thousands of people to tune in and watch even though they aren’t paying for a slot or receiving any cards.”
Cllct.com tweeted today’s news and also tweeted WhatNot’s full response to the allegations that it is an “unregulated online casino.” In its response, it says gambling isn’t allowed on its platform “and we strictly enforce this policy”:
Baseball America reported there had been recent complaints against Fanatics and Topps, writing, “In recent months, Topps and Fanatics Live have come under fire from collectors who have been unable to purchase product directly from Topps while breakers on Fanatics Live will have cases of the product available at a mark-up. Fanatics Live also offers repacks, some of which the company coordinates itself and which are run sitewide, and many which are run independently by individual breakers.”
That may include a reference to a widely circulated video on Instagram in December made such complaints, followed up with an image of a cease & desist letter allegedly sent by Fanatics (which did not respond to our inquiry at the time).
People are reacting to the news on a WhatNotApp subreddit thread, with one person asking if eBay Live could be next.
