Had you forgotten about BAYC? Not so fast. The development of blockchain technology and crypto has led to the creation of Non-Fungible Tokens (NFTs). These digital assets have taken the crypto world by storm and have already solidified themselves as interesting assets to invest in.
NFTs have already taken center stage, but controversies around these digital artworks still exist. One of the most popular projects currently in the market and in conversation is the Bored Ape Yacht Club (BAYC).
The project’s success has been witnessed and wildly celebrated, but certain challenges around digital projects still loom. One such challenge is the appeal brought by artist Ryder Ripp, who appealed a BAYC-related issue in front of a panel of judges.
BAYC Ryder Ripp’s case
Ryder Ripps, a well-renowned artist, found himself in a legal battle with the developers behind the Bored Ape Yacht Club (BAYC). In the appeal, Yuga Labs, developers behind BAYC, claimed that Ripp and his associate Jeremy Cahen were engaged in trademark infringement. Yuga Labs appealed and filed the complaint in July 2022.
The hearing proceedings on October 17 involved a panel of three judges from the United States Court of Appeal for the Ninth District. However, the panel seemed extremely unpersuaded by Ripps and Cahen’s attorney and termed the appeal as uncompelling. The lawyer argued that the case should be dismissed on grounds of free speech.
Apparently, the fake Bore Ape NFTs were marketed, sold, and distributed using an anti-semitic imagery strategy. This lured buyers unsuspecting of the knock-off digital artworks. Additionally, this activity was carried out within the Yuba Labs network.
They claimed that the artwork was used without their knowledge of BAYC’s ecosystem. This included the collection of 10,000 unique ape-themed Non-Fungible Tokens. The pair had made millions of dollars while falsely advertising the digital artwork and unfair competition that followed the release of the derivative NFT collection termed RR/BAYC.
On April 21, the California District Court discovered that Ripps and Cahen infringed Yuga Lab’s trademark and used their RR/BAYC Non-Fungible Token collection.
According to the team behind the BAYC, Ripp used Yuba Lab’s trademark without proper attribution and compensation for their work. This is considered a serious allegation in the digital space, especially NFTs. Basically, NFTs are unique digital artworks that belong entirely to their developers unless used or sold with their consent.
Regardless of Ripps’s case looking like a straightforward case that could be resolved easily, it has become a deeper issue. The panel of judges still expresses a degree of skepticism toward the validity of his claims on free speech. There are various issues that have contributed to their skepticism, including proving why the SLAPP statutes should be implemented.
Ripp’s argument
The lawyer representing Ryder Ripp and his associate Jeremy Cahen struggled to convince the court and the panel of judges that Yuga Labs’s case should be framed under Carlifonia’s anti-SLAPP statute. The lawyer stated that Ripp and his partner sold the NFTs as an avant-garde drill that was backed by the frameworks of free speech. As such, he claimed the case should be thrown under the SLAPP statute. It’s a California law that targets to stop intimidatory lawsuits against public participation.
According to Thomas Sprankling, WilmerHale partner, the anti-SLAPP statute was forged as a prophylactic strategy. His views on the statute were, “It goes a little beyond the bounds of the First Amendment to make sure you’re not threatening people with chilling speech in litigation, as is the case that happened here.”
Judge Anthony Johnstone responded to Sparklin’s argument, stating, “He was selling the same images, on the same marketplaces, on virtually indistinguishable NFT identifiers.” Judge Morgan Christen also added, “I’m still not seeing it.”
The argument was based on Yuga Labs trying to silence Ripp’s and Cahen’s protest art in order to bankrupt them. Regardless, the judges still seemed to focus their interest on the secondary sales of the NFTs. As such, they dismissed any arguments that pivoted to artistic criticism.
