Artists Ryder Ripps and Jeremy Cahen find themselves in a legal quagmire as their counterclaims against Bored Ape Yacht Club (BAYC) creator Yuga Labs have been dismissed by the court.
The unfavorable order handed down requires the pair to pay a hefty sum of $9 million in disgorgement and other statutory damages.
The legal battle stems from their actions in May 2022 when Ripps and Cahen unveiled the Ryder Ripps BAYC (RR/BAYC) collection, which bore striking resemblance to the renowned BAYC brand.
In April 2023, a judge ruled in favor of Yuga Labs, asserting that Ripps and Cahen had violated copyright laws by creating unauthorized versions of BAYC nonfungible tokens (NFTs).
This initial ruling compelled the duo to pay $1.57 million in damages to Yuga Labs, in addition to covering the legal fees, seemingly concluding the lawsuit.
However, the latest court filing on February 2nd brought a new twist to the legal saga.
Ripps and Cahen’s counterclaims against the charges were dismissed, and they were now slapped with a staggering $9 million penalty, encompassing lawyer fees, expert witness fees, and disgorgement.
The court further mandated them to dispose of any RR/BAYC NFTs they possessed, either by destroying (“burning”) them or providing them to Yuga Labs for disposal.
In response to the unfavorable ruling, Cahen, known as Pauly to his 174,100 followers on X, announced their intention to appeal the decision in the Ninth Circuit Court of California.
READ MORE: Bitcoin Stumbles as Strong U.S. Job Data Sparks Rate Hike Fears
Ripps and Cahen had initially filed counterclaims against Yuga Labs, accusing them of intentional infliction of emotional distress, negligent infliction of emotional distress, and seeking a declaratory judgment of no defamation.
However, the judge ruled against Yuga Labs’ first and third causes of action, which alleged false designation of origin and cybersquatting (the practice of buying domain names to profit from a trademark), while imposing the substantial multimillion-dollar penalty.
Additionally, the court ordered Ripps and Cahen to surrender all social media accounts associated with RR/BAYC NFTs and the smart contract used in their creation.
The filing emphasized the need for them to destroy any infringing materials, including NFTs, articles, documents, software, promotional items, or advertisements linked to the BAYC Mark, under their possession or control.
As the legal battle continues, the artists find themselves facing not only a significant financial burden but also the prospect of relinquishing their creations in the NFT world.
Discover the Crypto Intelligence Blockchain Council
