A U.S. district court judge has ordered two non-fungible tokens (NFT) artists, Ryder Ripps and Jeremy Cahen, to pay $1.57 million in damages and legal fees to Yuga Labs, the maker of the famous Bored Ape Yacht Club (BAYC) NFT collection.
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The judge ruled that Ripps and Cahen infringed Yuga Labs’ trademarks and copyrights by making and selling copycat versions of BAYC NFTs, which feature cartoon apes with various traits and accessories.
The judge rejected the defendants’ argument that their NFTs were satire or parody, finding that they acted in bad faith and intended to profit from Yuga Labs’ reputation and goodwill.
The court also issued a permanent injunction against Ripps and Cahen, prohibiting them from creating, marketing, or selling any NFTs that are similar or confusingly similar to BAYC NFTs.
Yuga Labs Wins Lawsuit
Yuga Labs filed the lawsuit in June 2022, after discovering that Ripps and Cahen had launched a series of NFT projects that mimicked BAYC’s style and name, such as Bored Ape Chemistry Club, Bored Ape Kennel Club, and Mutant Ape Yacht Club.
The company claimed that these NFTs diluted and tarnished its brand, misled consumers, and diverted sales from its original collection.
BAYC is one of the most valuable NFT collections on the market, with over $2.3 billion in trading volume since its launch in April 2021. The floor price for a BAYC NFT is currently around $49,000.
During a hearing on October 16 in a U.S. appellate court, the legal representatives of Ripps and Cahen attempted to have the lawsuit dismissed, citing the protection of free speech under California’s anti-SLAPP law. Nevertheless, the arguments put forth by the attorneys did not seem to convince the panel of three judges.
The lawsuit is one of the first cases to address the issue of intellectual property rights in the NFT space, where plagiarism and counterfeiting are rampant. Yuga Labs said it was pleased with the outcome of the case and hoped it would deter other copycats from infringing its rights.
