New Trial Ordered in Bored Ape Yacht Club NFT Trademark Dispute
Ninth Circuit Court Reverses Ruling in Yuga Labs vs. Ryder Ripps NFT Case
Overview of the Case
The Ninth Circuit Court of Appeals has recently reversed a prior decision that favored Yuga Labs, the company behind the Bored Ape Yacht Club (BAYC) NFTs, in its legal battle against artist Ryder Ripps. On Wednesday, the appellate court determined that Yuga Labs needs to provide more substantial evidence to support its claims that Ripps’ “satirical” RR/BAYC NFT collection misled consumers, thereby sending the case back to the lower court for a new trial.
Background of the Lawsuit
In 2022, Yuga Labs initiated legal action against Ryder Ripps and his collaborator Jeremy Cahen, alleging trademark infringement and cybersquatting. The defendants contended that their work served as a parody intended to critique the BAYC brand. Initially, a district court ruled in favor of Yuga Labs, awarding the company over $8 million in damages and affirming its ownership of the trademarks associated with BAYC.
Court’s Findings
The appellate court clarified that although Yuga Labs has established priority over the BAYC trademarks, it did not adequately demonstrate that Ripps’ NFTs caused genuine consumer confusion, which is a crucial element for proving trademark infringement under U.S. law. The court refrained from making a definitive ruling on the infringement issue but stressed that Yuga Labs must persuade a factfinder in the upcoming trial.
Implications for the NFT Landscape
This legal dispute highlights the increasing complexities within the NFT sector, where trademark rights, parody, and digital art ownership are becoming more intertwined. The outcome of this case could set important precedents for how courts address intellectual property disputes related to NFT collections in the fast-evolving Web3 environment.
