Yuga Labs Facing Lawsuit Over Celebrity Promotion

Creators of Bored Ape Yacht Club (BAYC), Yuga Labs, are facing a class-action lawsuit accusing the company of enlisting celebrities to promote NFTs and mislead their followers into buying BAYC NFTs, amongst other digital assets, without complying with disclosure requirements. The class-action was filed on the 8th December with over 40 people and companies named as defendants in the lawsuit, including Serena Williams, Snoop Dogg, Jimmy Fallon, Paris Hilton, Justin Bieber and Madonna.

The two plaintiffs in the case, consumers Adonis Real and Adam Titcher, and their attorneys claim that Yuga Labs have executed a grand scheme in which they have discreetly paid high profile celebrities to pump up the value of the NFTs and perpetuate the idea that owning a BAYC NFT brings investor status and grants access to an exclusive and connected club. "Defendants' promotional campaign was wildly successful, generating billions of dollars in sales and re-sales," the lawyers wrote.

In statements to both Billboard and Cointelegraph, a spokesperson for Yuga Labs denied the allegations, calling them opportunistic and parasitic, and said that they "look forward" to proving that the claims are without merit. Along with other NFT projects, Yuga Labs are reportedly part of a wider investigation into the market as a whole, currently conducted by the United States Securities and Exchange Commission (SEC).