Sotheby’s Faces Lawsuit Over Alleged Deceptive NFT Promotions

Recently, Sotheby’s was named in a class-action lawsuit filed by Bored Ape Yacht Club (BAYC) investors against the creators of BAYC, Yuga Labs.

The investors allege that the auction house assisted Yuga Labs in “deceptively promoting” the accumulation of nonfungible tokens (NFT).

On December 10, 2022, BAYC investors filed a class action lawsuit against more than 40 defendants, including Yuga Labs and celebrities such as Post Malone, Justin Bieber, and Paris Hilton.

According to the lawsuit, Yuga Labs and the celebrities were able to “artificially increase” the prices of the NFTs through celebrity promotions. In a new development, Sotheby’s has been added to the lawsuit as a defendant.

On September 10, 2021, Sotheby’s auctioned 101 BAYC NFTs for more than $24 million. According to the plaintiffs, the broker’s 2021 NFT auction misled investors by making Yuga Labs appear legitimate.

However, according to CNN, the auction house stated that the allegations were “baseless.” Sotheby’s further stated that it is willing to “vigorously defend” itself.

Yuga Labs also reiterated Sotheby’s sentiments in the same report. According to the creators of BAYC, the new claims are “without merit or factual basis.”

Additionally, the company characterized the complaint as “opportunistic.” Earlier in 2023, another lawsuit involving Yuga Labs was resolved.

The NFT company settled litigation against a developer involved in the sale of RR/BAYC, a collection of counterfeit NFT cards, on February 7.

Yuga Labs and Thomas Lehman consented to a permanent injunction prohibiting Thomas Lehman from using similar BAYC imagery or operating social media pages that imply an affiliation with Yuga Labs.