Yuga Labs, the company behind the Bored Ape Yacht Club NFT collection, reached a settlement on April 8 with conceptual artist Ryder Ripps and his collaborator Jeremy Cahen, ending a dispute that began in June 2022 over an NFT collection that copied BAYC imagery almost exactly. A federal court in California entered the agreement, which permanently bars Ripps and Cahen from using Yuga's trademarks or any Bored Ape imagery. Financial terms were not disclosed.

What the Case Was About

Before launching the collection, Ripps had publicly accused BAYC of embedding racist, neo-Nazi, and alt-right imagery in its ape designs, a claim Yuga Labs denies. Ripps, who has described himself as an "expressive appropriation artist," launched the RR/BAYC (Ryder Ripps Bored Ape Yacht Club) collection using imagery nearly identical to the original BAYC series. He described the project in court filings as "a protest against and a parody of" the Bored Ape Yacht Club, arguing his work fell under artistic expression.

Yuga Labs disagreed and sued, alleging trademark infringement, false designation of origin, and cybersquatting.

The district court sided with Yuga Labs at nearly every turn. In April 2023 it granted summary judgment against Ripps and Cahen, rejecting their First Amendment, fair use, and unclean hands defenses. By October 2023 the court had awarded Yuga Labs approximately 9 million dollars in total, broken down as 1.4 million dollars in disgorgement of the defendants' profits, 200,000 dollars in statutory damages, and 7.3 million dollars in attorneys' fees.

The Appeals Court Changed the Calculation

The case shifted significantly in July 2025 when the Ninth Circuit Court of Appeals reversed the summary judgment. The appeals court held that Yuga Labs had not proven consumer confusion as a matter of law and ordered a jury trial to decide that question using the traditional Sleekcraft test, a multi-factor framework courts apply to trademark disputes.

The reversal also wiped out the 9 million dollar award, forcing both sides to weigh the cost and uncertainty of a new trial. Rather than proceed, they settled.

Two parts of the Ninth Circuit ruling held firm and will likely matter long after this case fades. First, the court confirmed that NFTs qualify as "goods" under the Lanham Act, the federal trademark statute. The court reasoned that NFTs "are actively traded in online marketplaces, possess economic value, and function similarly to traditional tangible goods in commerce." That holding settles a question that had created genuine uncertainty for anyone building or buying NFT-based brands. Second, the court held that Yuga Labs' practice of granting NFT purchasers extensive usage rights did not constitute "naked licensing" that would forfeit trademark protection, affirming that trademark rights remain distinct from the copyright or commercial rights bundled with digital art. That second holding carries practical weight for the many NFT collections that offer broad purchaser rights, confirming that creators can extend generous licensing terms without inadvertently surrendering their brand.

The court also rejected Ripps' First Amendment argument, finding his use of BAYC marks "went well beyond commentary" and crossed into commercial activity. That determination was specific to Ripps' conduct in this case and does not establish a sweeping doctrinal limit on First Amendment defenses across NFT disputes generally.

Where BAYC Stands Now

The settlement resolves the lawsuit but does nothing to reverse the BAYC collection's market slide. The floor price peaked at roughly 153.7 ETH in April 2022. It has since dropped approximately 82 percent in ETH terms and around 88 to 90 percent in dollar terms. The ApeCoin DAO, the governance structure once positioned as a centerpiece of the Yuga Labs ecosystem, was wound down in June 2025 via a proposal called AIP-596. Yuga Labs had driven the transition, seeking to replace the DAO with a new centralized entity called ApeCo, according to reporting by CoinTelegraph and CoinDesk. The global NFT market cap sat at approximately 8.1 billion dollars at the time of the settlement, down from a recent 9.3 billion dollar level, according to DappRadar.

What This Means Outside the United States

The legal outcome carries practical weight for NFT builders, collectors, and creators far from California. India has the world's highest NFT ownership rate, estimated between 13.5 and 15.5 percent of the population, and hosts a large base of Web3 developers, collectors, and digital artists active on Ethereum and EVM-compatible chains.

Indian trademark law does not yet include explicit provisions for NFTs, and U.S. appellate decisions carry persuasive authority in Indian legal discussions. The Ninth Circuit's ruling gives IP practitioners a concrete reference point when advising clients on registering and defending NFT-related brands domestically.

In Sub-Saharan Africa, Nigeria records an NFT ownership rate of 8.6 percent, Ghana sits at 7.5 percent, and Kenya, an established Web3 hub in East Africa, records 2.8 percent. The region received more than 205 billion dollars in on-chain value between July 2024 and June 2025, a 52 percent year-on-year jump, according to DemandSage and Ripple Insights.

For NFT creators and small Web3 startups in that region, operating on limited legal budgets, the case sends two clear signals. First, trademark registrations matter for NFT projects, and established collections have shown willingness to enforce those rights vigorously in U.S. courts; whether and how those rights extend into other jurisdictions depends on local IP frameworks and enforcement mechanisms. Second, commentary or parody defenses narrow sharply once commercial activity enters the picture. Any project using another collection's imagery in a derivative or satirical capacity carries real legal risk if sales are involved.

What Comes Next

The permanent injunction closes off any future use of BAYC imagery by Ripps and Cahen. The broader legal infrastructure left behind by the Ninth Circuit ruling, chiefly the confirmation that NFTs qualify as goods protectable under federal trademark law, will continue to shape how courts and IP attorneys treat digital assets.

Yuga Labs still controls the BAYC brand, though its challenge now is commercial rather than legal. Rebuilding collector interest and collection value in a market that has moved well past the 2021 and 2022 boom cycle is a harder problem than any courtroom could solve.