GOING BAYC TO COURT: The Ninth Circuit Affirms, Reverses, And Remands In Yuga Labs Case

Yuga Labs received a mixed ruling from the Ninth Circuit Court of Appeals on Wednesday, as the bench affirmed, reversed, and remanded parts of the lower court’s decision in the company’s case against Jeremy Cahen and Ryder Ripps. This means the case is headed back to court and could ultimately be decided by a jury.

Things were anything but boring in the courtroom as the Ninth Circuit sided with aspects of Cahen and Ripps’ appeal, sending the case back to district court to determine whether the duo’s RRBAYC collection could lead to consumer confusion. The judges noted errors in the lower court’s ruling, writing, “Yuga may ultimately prevail on these claims, but to do so it must convince a factfinder at trial.”

The court also ruled that Yuga Labs did not adequately explain its cybersquatting claims against the pair’s “rrbayc” and “apemarket” domains.

With this ruling, the Ninth Circuit overturned the lower court’s decision that Cahen and Ripps owed Yuga Labs $8.8 million in damages and legal fees.

At the same time, the court affirmed that Yuga Labs holds valid and enforceable trademarks and clarified that NFTs are considered “goods” under the Lanham Act, a U.S. federal law governing trademarks, service marks, and unfair competition.

Take a look at  how the court explained its decision below:

 

“The panel held that an NFT can be trademarked because it is a “good” under the Lanham Act, which protects marks used with “any goods or services.” The panel concluded that the statutory text did not establish that NFTs are categorically excluded from protection under the Lanham Act, because unlike the intangible content at issue in those cases, NFTs are not contained in or even associated with tangible goods. Rather, consumers purchase NFTs as commercial goods in online marketplaces specifically curated for NFTs. The panel concluded that defendants’ NFTs were “goods” under the Lanham Act.

The panel also concluded that Yuga had trademark priority because it was the first to use the Bored Ape Yacht Club marks in commerce and did not lose that priority either because it engaged in unlawful conduct in using the marks to sell unregistered securities or because it gave up its trademark rights when selling its NFTs.

The panel nonetheless reversed the district court’s grant of summary judgment for Yuga on its trademark- infringement and cybersquatting claims because Yuga did not prove as a matter of law that defendants’ actions were likely to cause consumer confusion.

The panel concluded that defendants’ use of Yuga’s marks did not constitute nominative fair use and was not “expressive work” protected by the First Amendment. As to the trademark claim, applying the Sleekcraft factors, the panel concluded that some of the factors indicated a likelihood of confusion, some did not, and some were neutral. Thus, viewing the facts and reasonable inferences therefrom in the light most favorable to defendants, the panel could not conclude as a matter of law that a reasonably prudent consumer in the marketplace was likely to be confused as to the origin of the goods bearing Yuga’s marks. As to the cybersquatting claim, Yuga did not establish as a matter of law that defendants’ domains were “confusingly similar” to Yuga’s protected marks.

The panel affirmed the district court’s rejection of defendants’ counterclaims, concluding that there was no genuine dispute of fact as to the DMCA claim and that the district court properly dismissed the claims for declaratory relief with prejudice. “ 

 

Shoutout to @NeerMcD for her detailed thread explaining where the case stands! Check it out below:

 

“TLDR the Ninth Circuit agreed with the district court in some aspects and disagreed as to others,” she tweeted. “Procedurally the Ninth Circuit thinks this case was better suited to be determined at the trial, rather than at the summary judgment stage.”

 

You can read the full ruling here: https://cdn.ca9.uscourts.gov/datastore/opinions/2025/07/23/24-879.pdf

The Bored Ape Gazette will continue to follow this case and will let you know what happens next. Stay tuned for updates!