US appeals court overturns Yuga Labs’ $9M win against Ryder Ripps in landmark NFT case

The US Ninth Circuit Court of Appeals overturned Yuga Labs’ $9M win against Ryder Ripps, dealing a blow to the NFT giant’s trademark infringement claims.

The court found insufficient evidence that Ripps’ satirical collection confused consumers, reigniting debates over free speech and intellectual property in Web3.

Yuga Labs’ $9M win against Ryder Ripps collapses as court demands trial

The three-judge panel unanimously reversed the 2023 judgment, declaring that Yuga Labs’ $9M win against Ryder Ripps couldn’t stand without proof of marketplace confusion. The case now returns to a California federal court, where a jury will decide if Ripps’ “Bored Ape” parody crossed legal boundaries.

The legal showdown: Yuga Labs’ $9M win against Ryder Ripps unravels

Yuga Labs, creator of the Bored Ape Yacht Club (BAYC) NFTs, initially secured a $9M win against Ryder Ripps and Jeremy Cahen in 2023. The artists were accused of trademark infringement for their “Ryder Ripps Bored Ape Yacht Club” collection, which Yuga claimed diluted its brand.

But the appeals court dismissed the summary judgment, emphasizing that consumer confusion—a cornerstone of trademark law—remained unproven.

“This is a huge victory for artists who seek to make expressive, meaningful work,” — Ryder Ripps, in a statement to journalists.

Satire or theft? The First Amendment clash

Ripps defended his collection as political satire, alleging BAYC embedded racist dog whistles in its imagery. The Ninth Circuit acknowledged his First Amendment defense but rejected blanket immunity, noting:

“Use of Yuga’s marks was not protected as nominative fair use.” Legal experts say the ruling narrows the path for parody NFTs.

“The line between commentary and infringement is now clearer,” — Rebecca Tushnet, Harvard Law professor, on the precedent.

NFTs as “goods”: A silver lining for Yuga Labs

Despite overturning Yuga Labs’ $9M win against Ryder Ripps, the court solidified NFTs’ status as trademark-protected “goods.” The judges affirmed Yuga’s priority as the first to commercialize BAYC marks—a decision that empowers NFT creators to sue copycats.

“Bored Apes are protectable trademarks, which is an important win for every NFT holder,” — Yuga Labs co-founder Greg Solano, on X.

What’s next for the crypto art world?

The case’s return to trial ensures prolonged uncertainty for NFT creators. Key questions remain: Can satire justify near-identical NFTs? How much confusion is too much? With Yuga Labs’ $9M win against Ryder Ripps vacated, the district court’s new verdict may set enduring standards for digital art.

Key points:

• The Ninth Circuit overturned Yuga Labs’ $9M win against Ryder Ripps, demanding a trial on trademark claims.

• NFTs are now unequivocally “goods” under US trademark law.

• Parody defenses face higher bars after this ruling.