- Sotheby’s sold over 100 BAYC NFTs during the “Ape In!” auction.
- NFT collections were trading at record highs during the 2021 crypto market boom.
Non-fungible token (NFT) company Yuga Labs’ celebrity-centric lawsuit went through an amendment recently, news media house CNN reported. Now the plaintiffs have added the auction megahouse Sotheby’s alongside defendants. The legal team is taking into account the auction house’s sale “Ape In!” auction during September 2021 to make the case.
Sotheby’s Ready To Take The Lawsuit Head-On
The lawsuit enmeshed around 30 celebrities some of which include Jimmy Fallon, Madonna, Post Malone among others. Plaintiffs said Sotheby’s artificially inflated the price of their flagship NFT collection, Bored Ape Yacht Club (BAYC). The plaintiffs believe the auction house’s sale of over $24 Million to FTX, a bankrupt crypto exchange, gave collectibles “an air of legitimacy,” according to Ars Technica, a news website.
The auction house did not disclose the buyer’s identity at the time of the sale, calling the purchaser a ‘traditional’ buyer. However, the lawsuit mentions the fallen crypto exchange made the purchase. Sotheby’s told CNN that “The allegations in this suit are baseless, and Sotheby’s is prepared to vigorously defend itself.”
Plaintiffs filed the case last year in December. The class action lawsuit alleges the celebrities broke federal and state laws. Guy Oseary, a talent manager, used his prominent celebrity network, asking them to publicly promote BAYC NFTs. Furthermore, Yuga Labs secretly funneled payments using cryptocurrency platform MoonPay as per the reports.
According to OpenSea, the biggest NFT platform, the leading collection’s floor price has cut to nearly half in three months. Meanwhile, total volume suffered drastically too. As of now, there are over 5K owners of the collection. A majority of owners hold at least one BAYC in their wallet.
Yuga Labs’ spokesperson prefers to call its users “purchasers of their products.” However, plaintiffs’ legal representative, Sean Masson, argues “his clients plainly saw the NFTs as a financial asset” according to New York City-based publication Quartz.
The crypto market boom in 2021 pushed the NFT market up alongside it. However, the boom turned into chaos in the following year. Nearly 117K NFTs were sold in August that year. However, the boom turned into chaos, dragging the market into a seemingly endless crypto winter.
BAYC Won a Lawsuit Recently, Was it The Last?
Recently, Yuga Labs won a copyright infringement case. Ryder Ripps and Jeremy Cahen, conceptual artists, released a NFT collection dubbed RR/BAYC in May 2021. BAYC owners alleged the artists had misused Bored Apes’ trademark. Last year, a couple of copycat projects caused a stir among the BAYC community.
If the plaintiffs win the lawsuit, it could user trust in NFTs could be adversely affected. Additionally, celebrities owning BAYC NFTs including Eminem, Snoop Dogg, Neymar Jr. and more who aren’t involved in the lawsuit could receive a slight backlash from followers.