In a ground-breaking decision with profound implications for the NFT space, artist Ryder Ripps and his associate Jeremy Cahen have been directed to pay $1.5 million in damages to Yuga Labs. This landmark legal battle revolved around Ripps’ NFT collection, RR/BAYC, which bore a remarkable resemblance to Yuga Labs’ Bored Ape Yacht Club (BAYC) NFTs, marking one of the most significant lawsuits within the NFT arena.
The court’s Findings of Fact and Conclusions of Law unequivocally declared that the inclusion of Yuga’s BAYC Marks in Ripps’ collection was “intentional” and executed “in bad faith…with the expectation of profiting from that use.” The court further highlighted that the Defendants “failed to offer any persuasive evidence at trial to support their argument.” Consequently, Ripps is mandated to cede control of the RR/BAYC smart contract to Yuga Labs and forfeit all profits derived from the sale of RR/BAYC NFTs.
The court’s validation of Yuga’s ownership claim over the BAYC Marks extends to various commercial realms, encompassing online gaming and merchandise marketing. Alongside the $1.5 million in damages, the judge issued a permanent injunction against Ripps and Cahen, prohibiting any future infringing activities. Notably, the burden of proof now rests on the defendants to demonstrate which of their sales were not attributable to their infringing activity.
This ruling holds profound implications for the NFT community, underscoring the paramount importance of respecting intellectual property rights. The court dismissed Ripps’ argument of “appropriation art,” asserting that the RR/BAYC collection lacked constructive commentary, criticism, or differentiation from Yuga Labs’ BAYC NFTs. Beyond its immediate legal implications, this case serves as a cautionary tale in the NFT space, emphasizing the necessity for creators to uphold intellectual property rights and refrain from activities that could tarnish the reputation of existing projects.
