In a significant legal triumph for Yuga Labs, the creators of the renowned Bored Ape Yacht Club (BAYC), a U.S. District Judge in California ruled in favor of the company against Ryder Ripps and Jeremy Cahen. The court awarded Yuga Labs over $1.5 million in damages, emphasizing the profits made by Ripps and Cahen from the sale of infringing Bored Ape Yacht Club NFTs.
According to court documents disclosed by a Yuga Labs spokesperson to Decrypt, the defendants asserted that their use of Yuga’s trademarks was not infringement but rather “satire” and “parody.” However, the court sided with Yuga Labs, declaring that it was indeed an infringement on their trademark.
In response to the court ruling, the Yuga Labs spokesperson stated, “After the court ruling against Ryder Ripps and Jeremy Cahen for infringing Yuga Lab’s intellectual property, today they’ve been ordered to cease all sales and marketing of their counterfeit NFTs. They must pay $1.575 million in damages, Yuga’s attorneys’ fees, transfer their fake apes’ smart contract, and relinquish related online assets.”
The judgment by Judge John Walter included a $200,000 award for cybersquatting violations, specifically $100,000 per domain, and a permanent injunction against the defendants. The court concluded that the defendants acted with a “bad faith intent to profit.”
In a statement, Yuga Labs hailed the decision as a “landmark legal victory for Web3,” emphasizing the broader significance for the entire industry in holding counterfeiters accountable.
Ripps and Cahen had argued that their use of Bored Ape Yacht Club logos was protected under the First Amendment and fair use. However, the court dismissed this argument, granting Yuga Labs a summary judgment for trademark infringement and cybersquatting claims.
The court highlighted the defendants’ intent to divert customers by registering domain names such as rrbayc.com and apemarket.com, citing cybersquatting as the motive. Additionally, the court dismissed the counterclaim that Yuga Labs made false accusations of infringement and used inappropriate imagery.
The ruling affirmed Yuga Labs’ ownership of the Bored Ape Yacht Club marks, emphasizing the defendants’ lack of a good faith reason for using the domains after the launch of Yuga’s NFT collection in April 2021.
The Bored Ape Yacht Club, comprising 10,000 randomly generated NFTs on the Ethereum blockchain, has become a cultural phenomenon since its launch. This legal victory not only safeguards against scammers but also upholds the rights of creators in the evolving landscape of Web3 experiences.
