US District Court Orders NFT Artists to Pay $1.57 Million in Copyright Lawsuit
In a resolution to a year-long copyright lawsuit, a US district court has ruled that non-fungible token (NFT) artists Ryder Ripps and Jeremy Cahen must pay Bored Ape Yacht Club (BAYC) creator Yuga Labs approximately $1.57 million in damages. The judge also determined that Yuga is entitled to attorneys’ fees and costs.
The Origin
The lawsuit originated in June 2022 when Yuga filed a lawsuit against the duo for copyright infringement and cybersquatting related to the BAYC NFT collection. Yuga claimed that Ripps and Cahen had violated copyright laws by producing and selling counterfeit versions of its BAYC NFTs.
The lawsuit specifically accused the defendants of attempting to “devalue the Bored Ape NFTs by flooding the NFT market with their own imitation NFT collection, using the original Bored Ape Yacht Club images, and labeling them as ‘RR/BAYC’ NFTs.”
Additionally, the plaintiff alleged that the defendants engaged in cybersquatting by registering domain names that were confusingly similar to the BAYC website and social media accounts.
The defendants’ lawyers argued that the use of BAYC trademarks was not infringement but rather a form of “satire” and “parody.”
Court Ruling Favors Yuga
After reviewing the evidence, witness credibility, and pretrial and post-trial submissions, the court determined that the defendants’ use of Yuga’s BAYC trademarks was deliberate and done with the intention of profiting from it. District Court Judge John Walter stated that it is unjust for the defendants to profit from unlawful infringement.
Based on these findings, the court awarded Yuga $1.37 million as disgorgement of Ripps and Cahen’s profits from the sale of counterfeit NFTs. Additionally, the court granted the plaintiff $200,000 in statutory damages for the cybersquatting violations.
The defendants have also been instructed to transfer control of two domain names, two X (formerly Twitter) accounts, and a smart contract of the counterfeit NFTs to Yuga.
The remaining matters in the case involve the equitable remedies that will be granted to Yuga.
Tags: NFTs
