Bored Ape Creator Yuga Labs Loses $9M in Appeals Court Ruling

The Ninth Circuit Court of Appeals ruled Wednesday that Yuga Labs had not demonstrated Ripps and his partner Jeremy Cahen’s “Ryder Ripps Bored Ape Yacht Club” NFTs were “likely to cause consumer confusion.” The court reversed the district court’s decision and canceled the $9 million damages award.

Yuga Labs sued Ripps and Cahen in 2022, claiming their satirical NFT collection infringed on its Bored Ape Yacht Club trademarks and constituted cybersquatting. A federal court ruled for Yuga in 2023, initially awarding $1.6 million, which grew to $9 million after Ripps and Cahen lost a counterclaim.

While the appeals panel confirmed Yuga’s trademark rights, they ruled the company failed to prove consumer confusion. The court rejected Ripps’ fair use and First Amendment defenses but still sided with him on the main infringement claim.

The case will return to a California federal court for a full trial on the infringement and cybersquatting claims. Both the trademark infringement and cybersquatting allegations remain active and will be decided at trial.

The decision establishes that NFTs are “goods” under U.S. trademark law, potentially enabling other NFT creators to bring or defend trademark actions in similar disputes. This marks the first appeals court ruling to address NFT trademark issues at this level.

Ripps created his collection as satirical commentary, featuring apes with identical traits to the originals but adding critical messaging about Yuga Labs.

The original case centered on whether consumers would mistake Ripps’ satirical collection for official Yuga Labs products. The appeals court found insufficient evidence that buyers were confused about the source of the NFTs.

Yuga Labs has not announced whether it will appeal the decision to the Supreme Court. The company continues to hold intellectual property rights to the Bored Ape Yacht Club brand and imagery.