A US judge dismissed an investor lawsuit against Yuga Labs, stating NFTs like Bored Ape Yacht Club do not meet the legal definition of securities. The plaintiffs failed to prove NFTs were investment contracts under the Howey test, with no expectation of profits. Yuga marketed NFTs as consumables, not investments.

The judge ruled that NFT collections by Yuga Labs do not qualify as a “common enterprise” with profit expectations. NFTs on public blockchains lack a financial link between buyers and Yuga. Investors paid fees separate from NFT prices. Yuga did not promise profits to buyers or meet Howey test conditions for profit expectations.

Yuga Labs did not make explicit profit promises to NFT buyers, and statements about NFT value or trade volumes do not guarantee profits. Judge Olguin emphasized that statements about intrinsic value do not equate to profit expectations. The lawsuit against Yuga Labs was originally filed in 2022.

Read more at Cointelegraph: Judge Tosses 2022 Investor Lawsuit, Says Yuga NFTs Are Not Securities