Bored Ape Yacht Club creator Yuga Labs is entitled to an injunction and damages from Ryder Ripps and Jeremy Cahen over their copycat RR/BAYC NFT collection, a federal judge declared late Friday in a pretrial summary judgment in a case involving trademark infringement filed by startup last summer.
Yuga Labs described the ruling as a “groundbreaking legal victory for Web3.”
“This is not just a win for us, it’s a win for the entire Web3 industry to hold fraudsters and counterfeiters accountable,” said a Yuga Labs spokesperson. Decrypt.
Cahen and Ripps described their RR/BAYC project — which includes identical copies of the original Bored Ape Yacht Club profile pictures (PFPs) — as a parody, protected by the First Amendment, and called the Yuga Labs lawsuit “frivolous.”
Ripps and others have called out what they believe are racist symbols and references within the Bored Ape Yacht Club artwork, which Yuga Labs has repeatedly denied. Co-founder Wylie “Gordon Goner” Aronow called Ripps a “demented troll” in a blog post last summer.
“This case is a baseless attempt to silence our very real and valid artistic criticism,” Cahen wrote on Twitter last summer under his pseudonym Pauly. “Trademark law is not a muzzle.”
Yuga Labs, meanwhile, said the RR/BAYC project “defrauded” buyers with falsely equivalent NFTs in a “deliberate attempt to harm Yuga Labs at the expense of consumers.”
The court decision included findings both in favor of and against Yuga Labs. The judge agreed that Ripps and Cahen had committed “false designation of origin,” and affirmed Yuga Labs’ position that rebutted the defendants’ First Amendment and fair use defenses. The ruling also sided with Yuga Labs on the defendants’ claims that the company had “unclean hands” and knowingly misrepresented the infringing activity.
However, U.S. District Judge John F. Walter rejected Yuga Labs’ claim for “enhanced damages” in what it argued was an “exceptional case” — essentially a technicality based on the company’s intention to have the actual amounts determined in court.
“Yuga is entitled to monetary damages and injunctions,” the court ruled. “Yuga has reserved the issue of damages for trial.”
Trademark and copyright attorney Jessica Neer McDonald described the judge’s ruling as a “great victory” for the Yuga in a tweet on Friday, while law professor (and author of a recent NFT book) Edward Lee similarly called it a “big win”.
The case is being watched closely in both crypto and art circles, with some observers predicting that Yuga Labs’ lawsuit against the noted provocateur could backfire. The company saw some early setbacks, including comments from the judge that it showed a “lack of diligence” and made claims that were “deficient in substance.”
Ripps also seemed optimistic about his chances of winning, hiring well-known attorney Louis Tompros, who also represented Pepe the Frog creator Matt Furie in several lawsuits against far-right organizations that allegedly partnered with the cartoon frog as a symbol on white supremacy.
In February, however, Yuga Labs reached a settlement in a separate trademark lawsuit against RR/BAYC developer Thomas Lehman, who helped Ripps create a smart contract for the project. A separate lawsuit against co-developer Ryan Hickman is still ongoing.
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