The Ninth Circuit Court of Appeals overturned a $9 million judgment awarded to Yuga Labs in its trademark infringement lawsuit against artists Ryder Ripps and Jeremy Cahen. The defendants had created a copycat NFT collection titled "Ryder Ripps Bored Ape Yacht Club" (RR/BAYC), which Yuga claimed mimicked its Bored Ape Yacht Club branding and imagery to mislead consumers.
The court remanded the case for trial, ruling that Yuga hadn't sufficiently proven consumer confusion – a key requirement for trademark infringement. While overturning the monetary award, the panel established a landmark precedent: NFTs qualify as "goods" under the Lanham Act, making them eligible for trademark protection. This decision mirrors the Hermès vs. MetaBirkins case in emphasizing evidentiary standards.
Defendants argued their project constituted protest art against alleged racist imagery in Yuga's original artwork, denying commercial intent. The court rejected their First Amendment and nominative fair use defenses. Yuga co-founder Greg Solano acknowledged the trademark precedent as "an important win for every NFT holder" but vowed to continue the legal battle in district court.
Market reaction remained neutral with no immediate NFT or DeFi volatility observed. The trial will now address brand confusion, artistic intent, and commercial implications, with outcomes potentially reshaping digital asset regulations.
