Trademark Lawsuit Challenges Artistic Expression in NFT World

A U.S. appeals court grappled with the blurred line between art and counterfeiting in a trademark lawsuit against conceptual artist Ryder Ripps, who created replicas of Yuga Labs' popular Bored Ape Yacht Club non-fungible tokens (NFTs).

Ripps' lawyer argued before the 9th U.S. Circuit Court of Appeals that Yuga's case should be dismissed under California's anti-SLAPP statute, designed to shield conduct "in furtherance of" free speech from frivolous lawsuits.

Yuga's lawsuit alleges that Ripps profited by counterfeiting its Bored Ape tokens under the guise of satire. Ripps claims his copies are forms of appropriation art critiquing perceived racial and anti-Semitic imagery in Yuga's NFTs and branding.

In an earlier ruling, U.S. District Judge John Walter favored Yuga, deeming Ripps' NFTs "no more artistic than the sale of a counterfeit handbag."

Ripps' attorney, Thomas Sprankling, asserted that the NFTs are "expressive both on their own and as part of a broader artistic project." He cited examples like PETA's Chicken McNuggets and Greenpeace-branded SeaWorld, arguing that similar conduct should be protected by the California statute.

The judges questioned whether Ripps' actions went beyond the limits of free speech protection. U.S. Circuit Judge Anthony Johnstone raised the analogy of "punching Yuga Labs' founders in the face on a TikTok video." The court sought a "limiting principle," and concerns were raised about certain allegations, such as alterations to a logo resembling a Nazi symbol.

The case is Yuga Labs Inc v. Ripps, 9th U.S. Circuit Court of Appeals, No. 22-56199.