Judge Dismisses Yuga Labs Lawsuit, Rules BAYC NFTs Aren’t Securities

A federal judge has dismissed a high-profile lawsuit against Yuga Labs, the company behind Bored Ape Yacht Club (BAYC), ruling that its NFTs do not meet the legal threshold to be considered ￰0￱ Takeaways: A US judge ruled that BAYC NFTs and ApeCoin do not qualify as securities under the Howey ￰1￱ court found no common enterprise or profit expectation linking buyers to Yuga ￰2￱ decision sets a precedent supporting NFTs as digital collectibles rather than investment ￰3￱ decision marks a key moment in the ongoing debate over how ￰4￱ laws apply to digital ￰5￱ Rules BAYC NFTs and ApeCoin Don’t Meet Howey Test Criteria Judge Fernando ￰6￱ ruled that the plaintiffs failed to show how BAYC NFTs, ApeCoin (APE), or other Yuga-linked digital assets satisfy the three-pronged Howey Test, used by the SEC to determine what constitutes an investment ￰7￱ lawsuit, filed in 2022, alleged that Yuga Labs misled buyers into expecting profits from their NFT ￰8￱ his decision, Olguin said the NFTs were marketed as digital collectibles offering exclusive membership benefits, not as profit-seeking investments.

“The fact that defendants promised that NFTs would confer future, as opposed to immediate, consumptive benefits does not alone transmute those benefits from consumptive to investment-like in nature,” he ￰9￱ court found that there was no “common enterprise” between buyers and Yuga Labs—an essential component under the Howey ￰10￱ NFTs were tradable on public blockchains and lacked any ongoing financial arrangement between purchasers and the company. NEWS: A California judge ruled Bored Ape NFTs are not securities, tossing the class-action suit against Yuga Labs Unlike Top Shot & DraftKings, BAYC was sold on 3rd-party marketplaces, and royalties weakened the “common enterprise” link Major precedent for NFT securities law ￰11￱ — Now Media (@nowmedia) October 3, 2025 Legal experts noted the significance of the ruling.

“Statements about NFT prices and trade volumes are a somewhat closer call, but even then, these statements by themselves fail to establish an expectation of profit,” Olguin ￰12￱ attorney Bill Hughes pointed out that fees collected by Yuga were independent of NFT pricing, further weakening the plaintiffs’ ￰13￱ court also said that general statements about value or future plans did not equate to promises of ￰14￱ ruling strengthens the argument that most NFTs, particularly those designed as digital collectibles with access features, do not fall under existing US securities regulations, setting precedent for other ongoing cases in the ￰15￱ and StockX Settle NFT Trademark Dispute Ahead of Trial As reported, Nike and StockX have settled their nearly three-year legal battle over sneaker-linked NFTs, bringing an abrupt end to a closely watched case that could have set new precedent for digital asset and intellectual property ￰16￱ agreement, filed last Friday in New York federal court, cancels a jury trial scheduled for October and dismisses all claims with ￰17￱ lawsuit began in 2022 when Nike accused StockX of trademark infringement over its “Vault” NFTs, which used Nike-branded ￰18￱ conflict intensified when Nike alleged that StockX had sold counterfeit shoes, claims partially upheld in March, when a judge ruled StockX had sold fake Nikes to both investigators and a ￰19￱ settlement spares both parties from further reputational and legal ￰20￱ development follows Nike’s broader retreat from digital ￰21￱ company’s web3 arm, RTFKT, announced it would shut down operations by early 2025, citing a shift to legacy ￰22￱ closure has drawn investor backlash, with some alleging they were left holding worthless digital assets after the sudden pivot.