Seth Green was a proud member of the Bored Ape Yacht Club—until recently, that is.
On May 17, the actor and producer tweeted that he had been the victim of a phishing scam and four NFTs, including Bored Ape #8398, and three other Ethereum NFTs—Mutant Apes #9964 and #19182, and Doodle #7546—had been stolen.
Phishing is a form of cybercrime that attempts to steal something of value (in this case, an NFT) through deceptive emails, websites, or social media.
All of this has sparked a debate over what exactly Green has lost, and whether the theft means that Green will no longer be able to go forward with a planned TV show centered around the NFTs—unique tokens that are used to demonstrate ownership over digital items.
The issue is a tricky one because of the licensing rules that govern the Bored Ape Yacht Club and Mutant Ape Yacht Club NFT series. While Yuga Labs, the creators of the Bored Ape Yacht club, owns the copyright to the Bored and Mutant Ape Yacht Club brands, the company gives the owner of the individual NFTs a broad license to use the image they own.
Yuga Labs says it grants holders of the NFT an unlimited, worldwide license to use, copy, and display the purchased art. This license allows the owners to create derivative works based upon the Bored Ape intellectual property (IP), for example, the Bored & Hungry restaurant in Los Angeles.
“When you purchase an NFT, you own the underlying Bored Ape, the art, completely,” Yuga Labs says on the Bored Ape website.
Seth Green’s Bored Ape problem is not rooted in copyright (BAYC owns that) but in BAYC’s broad license.
That license gives the “purchaser” fairly broad use of the IP and doesn’t exclude criminal/bad faith buyers.
The BAYC license, however, does not account for NFTs stolen in phishing scams and sold on the secondary market—meaning that the person who bought Green’s NFTs is now the “purchaser” under the licensing rules. This could mean Green can’t go forward with the NFT-themed show, “White Horse Tavern,” if he no longer has a license to the intellectual property behind the NFTs.
Ironically, just last week, during Gary Vaynerchuk’s VeeCon conference, Green revealed the trailer for the planned show, which featured Bored Ape #8398 that Green owned before the theft.
Some observers have suggested that the person who currently possesses the Bored Ape—for now known only as DarkWing84—could take legal action against Green if the actor uses the intellectual property without permission.
That seems unlikely, however. Preston Byrne, a lawyer and partner at Anderson Kill, noted on Twitter that there is a legal doctrine called the “clean hands” rule that prevents those who obtained property in a dishonest fashion from profiting from it.
Nemo dat quod non habet. The thief doesn’t get good title to Seth Green’s IP, nor does anyone who buys it from said thief with notice. https://t.co/XHjKZaSbWT