Behind the esports headlines, one of FaZe Clan's quieter courtroom fights ended in a clean win: a New York federal judge confirmed an arbitration award rejecting a multimillion-dollar referral-commission claim, and the case has been closed since 2022.
What Is This About?
Adult Use Holdings, Inc. and Zola Ventures Ltd. — investor-side entities that had connected FaZe Clan with financing — claimed they were owed a referral commission on the esports organization's venture fundraising. Their claim went to arbitration and lost. When they asked a court to undo that result, FaZe Clan asked the court to lock it in. The case, Adult Use Holdings, Inc. v. FaZe Clan, Inc., No. 1:21-cv-10313 in the U.S. District Court for the Southern District of New York, was a fight over whether the arbitration award would stand.It did. On September 28, 2022, U.S. District Judge Mary Kay Vyskocil denied the petition to vacate or modify the award and granted FaZe Clan's cross-petition to confirm it. The case was terminated on September 30, 2022, and no subsequent appeal has surfaced in the public record. (A "last updated" date on some docket mirrors reflects an automated re-scrape, not new activity — the matter has been closed since 2022.)
The Underlying Business Dispute
The claim traces back to a referral agreement dated October 19, 2020, under which Adult Use Holdings was to receive a 5% commission on securities purchased by investors it referred to FaZe Clan. Adult Use — joined by Zola Ventures on an alleged separate arrangement — argued it was owed that commission in connection with a later round of FaZe Clan's financing. FaZe Clan disputed that reading, and it ultimately paid a 5% commission to a different broker on the transaction rather than to Adult Use or Zola.The parties had agreed to arbitrate, and the matter went before the International Centre for Dispute Resolution (the international arm of the American Arbitration Association). In a partial final award issued August 4, 2021, the arbitrator dismissed the claims on a pre-hearing dispositive motion, concluding that the plain language of the referral agreement did not entitle Adult Use to a commission on that financing, and that Zola — which had no corresponding agreement with FaZe on the transaction — was likewise owed nothing.
How the Court Case Ended
The dispute reached federal court by an unusual route. Adult Use and Zola first moved in New York state court to vacate the arbitration award; because foreign parties were involved, FaZe Clan removed the case to the Southern District of New York in December 2021 under the treaty governing recognition of foreign arbitral awards. There, the two sides squared off over the award — the claimants seeking to vacate or modify it, FaZe cross-moving to confirm.Judge Vyskocil sided with FaZe Clan. She rejected the arguments that the arbitrator had exceeded his authority or denied the claimants a fair hearing, noting they had not used their opportunity to present evidence during the arbitration. Confirming an award is the step that turns an arbitrator's decision into an enforceable court judgment, so the September 28, 2022 order effectively ended the dispute in FaZe Clan's favor. Because the claims were dismissed rather than reduced to a payout, this was a defense win — not a money award to either investor entity.
Why It Still Comes Up
The case surfaces in searches partly because of FaZe Clan's turbulent business history around the same period. FaZe went public in July 2022 through a SPAC merger, saw its stock fall sharply afterward, and was later acquired by GameSquare in 2024. Against that backdrop, an arbitration-confirmation fight over a financing commission is easy to mistake for something bigger. It wasn't a class action, a consumer case, or a fraud finding — it was a contract dispute over who was owed a finder's fee, resolved in FaZe Clan's favor and closed years ago.Frequently Asked Questions
What was the FaZe Clan arbitration lawsuit about?
Adult Use Holdings, Inc. and Zola Ventures Ltd. claimed they were owed a 5% referral (finder's) commission on FaZe Clan's venture financing under an October 2020 referral agreement. The dispute went to arbitration before the International Centre for Dispute Resolution, which dismissed the claims. Adult Use and Zola then asked a New York federal court to vacate that award, and FaZe Clan asked the court to confirm it.
Who won the FaZe Clan arbitration case?
FaZe Clan. The arbitrator dismissed the referral-commission claims, and on September 28, 2022 U.S. District Judge Mary Kay Vyskocil denied the petition to vacate the award and granted FaZe Clan's cross-petition to confirm it. The case was terminated on September 30, 2022. No later appeal has surfaced in the public record.
Was money awarded to anyone?
This was a defense win by dismissal rather than a money judgment for a claimant. The arbitrator rejected the commission claims, so Adult Use Holdings and Zola Ventures recovered nothing on them. Any specific costs or fees figure is not stated in the sources reviewed.
Is this a class action I can join?
No. This is a private commercial dispute between investment entities and FaZe Clan over a business commission. There is no class, no settlement fund, no claim form, and nothing for the public to claim.
Sources
• CourtListener — Adult Use Holdings, Inc. v. FaZe Clan, Inc., 1:21-cv-10313 (S.D.N.Y.)• Justia Dockets — Adult Use Holdings, Inc. v. FaZe Clan, Inc.
• Hughes Hubbard & Reed — note on the S.D.N.Y. confirmation ruling
• Sports Litigation Alert — Court Backs Arbitration Ruling in eSports Dispute
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