BAYC Creator Yuga Labs Wins Infringement Case; Will Receive $1.5M

The lawsuit featuring Bored Ape Yacht Club creator firm Yuga Labs and NFT artists Ryder Ripps and Jeremy Cahen sees its finale. The United District Court ruled in favor of the NFT-creating firm and asked the defendants to pay over a million USD in compensation. Despite counterarguments from NFT artists in support of their infringed creation, the final ruling made Yuga Labs’ hustle pay off.

The U.S. court brought the decision in favor of Yuga Labs and told Ripps and Cahen to pay $1.57 Million. The amount will be for compensating the disgorgement and damages done to the company because of NFT artists’ infringed creations.

In June 2022, Yuga Labs filed a lawsuit against Ryder Ripps and Jeremy Cahen, nonfungible token (NFT) artists. It alleged that they have created “copycat” NFTs of Bored Ape Yacht Club (BAYC) collectibles. The collection was created by the company and it marks a case of copyright infringement.

Earlier than the finale of the case recently, the court granted a partial summary judgment in April this year and it was also in favor of Yuga Labs.

District Court Judge John Walter has ruled in favor of Yuga Labs, awarding them $1.37 Million in a case where the NFT firm claimed entitlement to disgorgement of the defendant’s profits. An additional $200,000 was granted as statutory damages related to cybersquatting violations.

Judge Walter rejected the defendants’ argument that their imitation of Bored Ape Yacht Club (BAYC) NFTs was mere “satire” and “parody.” Instead, he ruled that they intentionally infringed Yuga’s BAYC trademarks with a bad faith intent to profit from them.

During the October 16th hearing in a United States appeals court, lawyers for the defendants, Ripps and Cahen, attempted to have the lawsuit dismissed under California’s anti-SLAPP law, citing free speech as grounds for dismissal. However, the three-judge panel did not appear convinced by their arguments.

Furthermore, Judge Walter highlighted that the defendants continued to market and promote their copycat BAYC versions even after a partial summary judgment was issued against them in April.

The court’s ruling emphasized that Ripps and Cahen lacked a good faith reason for their prior use of the domains because they registered them after Yuga had already launched the Bored Ape Yacht Club NFTs collection.

Launched in April 2021, the Bored Ape Yacht Club comprises 10,000 randomly generated NFTs on the Ethereum blockchain. NFTs, or non-fungible tokens, are unique digital assets cryptographically linked to digital and physical content, providing indisputable proof of ownership.

According to data from OpenSea, since its inception, the Bored Ape Yacht Club has seen significant success. It amassed 1.32 Million Ether (ETH) or approximately $2.38 Billion in trading volume. Notably, it boasts an average floor price of 27.4 ETH, equivalent to $49,200.