TikTok Lawsuits: Memorabilia Sellers Allege Forced Fanatics Partnerships

A legal storm is brewing in the digital world of sports memorabilia, fundamentally questioning the power balance between platform giants and individual sellers. Several US-based card breaking companies are accusing TikTok and sports merchandise giant Fanatics of enforcing an illegal monopoly. The allegations are serious: TikTok is said to have deliberately targeted successful merchant accounts with strikes for alleged trademark infringement and illegal gambling. According to the lawsuits, the goal of these measures was to drive sellers into the arms of Fanatics, the exclusive licensee for many major US sports leagues.

The business model of card breaking, where sellers open sealed packs of cards live on camera and viewers buy spots for specific cards or teams, is flourishing especially on platforms like TikTok Shop. However, for some of the most successful players, the gold rush ended abruptly. The plaintiffs, including Arizona-based MVP Breaks, Minnesota-based Quad City Breaks, and Ohio-based Dorm Dudes, describe a nearly identical pattern. First came the account strikes, then permanent bans, and finally instructions from TikTok employees that the only way back onto the platform was through a contract with Fanatics.

Numbers and facts

The financial dimensions of these cases are enormous. MVP Breaks stated that by August 2025, it was making approximately $475,000 per month selling autographed NFL helmets and card breaks on TikTok Shop. After repeated warnings for alleged gambling policy violations, revenue fell to $283,000 by September 2025 before the account was permanently banned. The story of Quad City Breaks is even more dramatic. Owner David Skalsky stated he was making as much as $200,000 per month but later had to file for Chapter 7 bankruptcy, which he directly attributes to the defendants' actions. Dorm Dudes, founded by student Zach Balo, reported sales of about $3.2 million in the fourth quarter of 2024.

A central figure in the accounts is Steve Halupka, described as TikTok Shop’s US Sports Collectibles Team Lead. According to MVP Breaks, Halupka pressured the owner to sign an exclusive agreement with Fanatics. In a text exchange around October 28, 2025, Halupka and another representative named Nick Bouris reportedly suggested contacting Ethan Cole at Fanatics. When asked why, they claimed Fanatics was acting on behalf of the NFL because the league wields a big, heavy sword.

Background

The connection between TikTok, Fanatics, and the NFL is tightly woven. The Topps brand, owned by Fanatics, became the exclusive trading card licensee for the NFL and the NFL Players Association in April. Furthermore, the league added Fanatics as one of its official betting operators in August, alongside DraftKings and FanDuel. According to the plaintiffs, this entanglement is designed to push alternative providers out of the market. Particularly poignant is the testimony from MVP Breaks and David Skalsky: both eventually signed the required Fanatics Memorabilia Seller Agreement, yet their channels were never reinstated despite the promises. Skalsky was left with tens of thousands of dollars in inventory he could no longer sell due to the contractual obligation to only offer Fanatics products.

"Despite signing the exclusive contract, Plaintiff’s account continued to be banned." - Extract from the lawsuit filed by David Skalsky, Quad City Breaks

Fanatics firmly rejects this portrayal. In a letter dated March 23, attorney Lawrence Buterman emphasized that nothing in the agreements imposes a requirement for exclusivity on TikTok. Nonetheless, sellers report a climate of fear and massive restrictions. Dorm Dudes stated they were forced to purchase NFL helmets at an inflated price of $625 per helmet from Fanatics-authorized distributors, while over $1 million in inventory from another supplier became unsellable.

Why it matters for German players

In Germany, the legal situation for card breaks is much more strictly defined than in the US. Since the receipt of a valuable item depends on chance when buying a spot in a break and a stake is paid, such formats quickly fall under the definition of unauthorized gambling according to the State Treaty on Gambling 2021 (GlüStV 2021). While antitrust issues are currently at the forefront in the US, providers of such formats in Germany would need a permit from the Joint Gambling Authority of the States (GGL), which is rarely granted for such hybrids of shopping and betting. German players should note that platforms like TikTok are under heavy scrutiny in this country to enforce youth protection and the ban on black market offers. The stake limits of 1 Euro per spin on slots or the monthly deposit limit of 1,000 Euro via the LUGAS system often do not apply to such gray market offers, which significantly increases the risk for consumers.

What it means for GGL-licensed casinos

For operators with a GGL license, this case highlights the risks of unclear partnerships with social media platforms. While licensed German casinos must meet strict advertising requirements, offers like card breaks on TikTok create an unfair competitive environment. The GGL consistently relies on the whitelist to separate legal offers from illegal or borderline practices. The US lawsuits show how quickly platforms like TikTok can change their policies, which would mean enormous legal uncertainty for companies in a regulated market like Germany. The strict separation of shopping, video content, and gambling, as intended by the German legislator, protects licensed providers from the kind of antitrust entanglements Fanatics and TikTok are currently accused of.