US judge joins Yuga Labs in Bored Ape NFT trademark lawsuit

(Reuters) – Yuga Labs Inc, the company that makes the popular Bored Ape Yacht Club non-fungible tokens, persuaded a Los Angeles judge to rule on Friday that an artist’s copies of the NFTs do not qualify as protected speech under the U.S. Constitution .

The court said Yuga’s NFTs were entitled to trademark protection, and that the copies created by concept artist Ryder Ripps and his business partner Jeremy Cahen infringed the company’s rights and were not protected by the First Amendment.

Ripps had claimed he copied the NFTs to criticize the company’s alleged racist and anti-Semitic symbolism.

Ripps’ attorney Louis Tompros of Wilmer Cutler Pickering Hale and Dorr said Monday that the artists plan to appeal. He said they stand by their view that Yuga does not have enforceable trademarks in its NFTs and that their project is protected speech.

A spokesperson for Yuga Labs on Friday called the decision a landmark “victory for the entire web3 industry to hold fraudsters and counterfeiters accountable.”

Yuga sued Ripps last year, alleging that he sold identical copies of the Bored Ape tokens under the guise of satire and made millions of dollars while “celebrating the damage” he caused.

Ripps responded that his works were “appropriation art” meant to draw attention to what he called the company’s racist dog whistles. He said Yuga’s Bored Ape logo mimics a Nazi emblem, the name “Yuga” refers to an alt-right slogan and the Apes themselves have “obviously racist messages and imagery.”

U.S. District Judge John Walter rejected Ripps’ First Amendment argument on Friday, finding that his NFTs “do not express an idea or point of view, but instead merely point to the same digital digital images associated with the BAYC collection,” and are “not more artistic than selling a counterfeit bag.”

Walter said Ripps’ copies were likely to confuse potential buyers and that Yuga was entitled to an amount to be determined at trial.

The case is Yuga Labs Inc v. Ripps, US District Court for the Central District of California, No. 2:22-cv-04355.

For Yuga: Eric Ball, Kimberly Culp and Anthony Fares of Fenwick & West

For Ripps: Louis Tompros, Monica Grewal and Scott Bertulli of Wilmer Cutler Pickering Hale and Dorr

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