Legal disputes are heating up between Sotheby's, BAYC, and its investors.
The non-fungible token (NFT) collection Bored Ape Yacht Club (BAYC) investors are challenging both the collection's creators, Yuga Labs, and the venerable auction house, Sotheby's.
According to investors, both entities conspired to "deceptively promote" the reputation and the prices of the BAYC NFTs.
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At the heart of this lawsuit is Sotheby's auction held on September 10th, 2021, when the firm sold 101 BAYC NFTs, yielding a whopping $24 million. Investors argue that this move played a crucial role in misleading potential buyers by giving Yuga Labs a veneer of legitimacy.
However, Sotheby's staunchly opposes these claims, calling them "baseless." On top of that, the company stated that it is prepared to "vigorously defend" itself.
Alongside Sotheby’s, Yuga Labs has also voiced its disagreement with the lawsuit's basis. The company noted that the suit was filed "without merit or factual basis" and deemed the legal challenge "opportunistic."
Broadening the scope, the lawsuit encompasses several other entities and prominent figures, totaling over 40 defendants. This includes notable celebrities like Post Malone, Justin Bieber, and Paris Hilton, accusing them of manipulating the NFT prices through endorsements.
Yuga Labs, though finding itself in the midst of this significant legal tussle, is no stranger to litigation. Earlier in 2023, they were embroiled in another legal battle, which they managed to settle. Both parties reached an agreement to prevent developer Thomas Lehman from using any BAYC-related imagery or hinting at any connections with Yuga Labs on social platforms.
It is worth noting that Thomas Lehman was selling an NFT collection, RR/BAYC, which was very similar to the actual BAYC.
As the NFT market continues its rapid expansion, such legal confrontations underline the evolving challenges in the sphere. This case, among others, serves as a testament to the complexities arising in the decentralized world.
The non-fungible token collection is facing a decline in interest. In July, the Bored Ape Yacht Club (BAYC) NFT collection saw its floor price fall below 30 ETH. This figure marks the new low not reached since October 2021.
