Yuga Labs Awarded Injunction and Damages in Knockoff NFTs Lawsuit

• Yuga Labs claimed that the RR/BAYC project was “scamming” customers.
• U.S. District Judge, however, dismissed Yuga Labs’ request for “enhanced damages.”

A federal court ruled late Friday in a pre-trial summary judgement in a trademark infringement action that Bored Ape Yacht Club (BAYC) creator Yuga Labs is entitled to an injunction and damages against Ryder Ripps and Jeremy Cahen for their knockoff RR/BAYC NFT collection. In a statement, Yuga Labs called the ruling a “landmark legal victory for Web3.”

Cahen and Ripps claimed that their RR/BAYC project, which included carbon duplicates of the original Bored Ape Yacht Club profile pictures (PFPs), was a parody protected by the first amendment and that the Yuga Labs action was “frivolous.”

First Amendment and Fair Use Arguments Rejected

Yuga Labs has constantly denied that the Bored Ape Yacht Club artwork contains any racial symbols or connotations, despite repeated accusations from Ripps and others. Ripps was labeled a “demented troll” by co-founder Wylie “Gordon Goner” Aronow in a blog post from the summer of 2022.

Meanwhile, Yuga Labs claimed that the RR/BAYC project was “scamming” customers by offering them NFTs that were not really similar, all in a “deliberate effort to harm Yuga Labs at the expense of consumers.”

The court’s decision included conclusions both for and against Yuga Labs. The court sided with Yuga Labs, finding that Ripps and Cahen had committed “false designation of origin,” and rejecting the defendants’ First Amendment and fair use arguments.

The court also found in favor of Yuga Labs when the defendants claimed the corporation had “unclean hands” and deliberately lied about the infringing conduct. U.S. District Judge John F. Walter, however, dismissed Yuga Labs’ request for “enhanced damages” in what it called an “exceptional case” since the business wanted the exact sums to be decided in court.

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