A US District Court Orders NFT Artists to Compensate the Creator of Bored Ape Yacht Club $1.57 Million

Cointelegraph reports that a district court judge in the United States has ordered nonfungible token (NFT) creators Ryder Ripps and Jeremy Cahen to pay Yuga Labs $1.57 million in disgorgement, damages, and legal fees in order to settle the protracted "copycat" NFT lawsuit. The order dated October 25th is a continuation of a partial summary judgement rendered in favour of Yuga Labs on April 21. In that judgement, the defendants Ripps and Cahen were found to have infringed copyright laws by producing counterfeit Bored Ape Yacht Club (BAYC) collectibles, according to the firm.

Yuga Labs was granted $1.37 million by District Court Judge John Walter, who determined that the NFT firm was eligible for a disgorgement of the profits earned by the defendants. In accordance with statutory damages, an additional $200,000 was awarded for cybersquatting violations. The judge ruled that Yuga Labs was entitled to attorney fees and expenses from the NFT artists due to the "exceptional case" nature of the trademark infringement.

The defendants' claim that the counterfeit BAYC versions were "satire" and "parody" was also rejected by Judge Walter, who ruled that the defendants infringed Yuga's BAYC trademarks intentionally with the malicious intent to profit from them. In addition, he noted that the defendants continued to market and promote their counterfeit BAYC versions following the April partial summary judgement against them. In June 2022, Yuga Labs initiated legal proceedings against the two artists. During a hearing on October 16 in a United States appeals court, the attorneys for Ripps and Cahen attempted to assert that the lawsuit ought to be dismissed on the basis of free expression in violation of California's anti-SLAPP statute. Despite this, it appeared that the three-judge panel was not convinced by the attorney's arguments.

BAYC is among the most valuable NFT collectibles on OpenSea, an NFT marketplace. OpenSea reports that it has amassed 1.32 million Ether (ETH) or $2.38 billion in trading volume since April 2021, at an average floor price of $29.200 (or 27.4 ETH).