Here’s a sentence Emily Nuvan never imagined she would say to another lawyer: “This ape has laser eyes, so that makes it much more valuable.”
But two years after graduating from S.J. Quinney College of Law, Nuvan finds herself enmeshed in the head-spinning world of DeFi, Web3 and NFTs, including some of the Internet’s most lucrative NFTs, the cartoonish simians known as Bored Apes.
(Quick time out. As Nuvan herself often tells people, “I don’t mean to be a jerk, but I’m going to use words you aren’t going to know, and say a lot of acronyms.” So, a quick refresher: NFTs — non-fungible tokens — represents digital ownership of art, music, even digital real estate. Buyers can provide proof of ownership with a one-of-a-kind code that is stored on the blockchain.)
Nuvan, who is an associate in the Salt Lake City office of Armstrong Teasdale, is one of the few lawyers nationwide litigating on behalf of people scammed by digital transactions like NFTs — transactions sometimes worth millions of dollars.
NFTs have been around for a decade but became a cultural phenomenon in March of 2021 when the artist Beeble sold an NFT of one of his paintings for $69 million. The next month, Yuga Labs began issuing the first of 10,000 NFTs in their series “Bored Ape Yacht Club,” which features drawings of apes with various combinations of hats, facial expressions and clothes.
The trick to success if you’re an NFT creator is not only that ephemeral mix of scarcity, novelty and luck, but also what is known as “utility.” In the case of Bored Apes, utility means offering owners the licensing rights to the Apes they own, plus invitations to members-only parties like ApeFest, which took place in June 2022 in New York City, where NFT owners Snoop Dogg and Eminem debuted a song featuring their own personal Apes. Owners also have access to Yuba Labs on-line areas such as “The Bathroom,” where they can “draw, scrawl, or write expletives.”
All of which is to say that this is new, often renegade, kind of puzzling territory. And because it’s so new, and because the ethos of NFTs favors decentralized finance (DeFi) without middlemen or regulations, it’s a Wild West that attracts scammers and hackers, says Nuvan. “This space is just known for being a den of thieves, because they know nothing will happen.” Ordinary people — “savvy people” —are losing millions of dollars. “Our client isn’t an idiot at all.”
That client, a man from Nevada, owned three Bored Apes worth about $1 million when he decided to trade Bored Ape 4329 (Army uniform, diamond earring, dumbfounded expression) on the NFT Trader website. “The thief sent him a link that looked completely like NFT Trader,” says Nuvan, “but it was a fake.” The scammers were then able to open the seller’s digital wallet and take all three Bored Apes as well as all his accumulated cryptocurrency. The FBI believes that the scammers originated in Russia, Nuvan says.
People who are scammed by crypto thieves, she says, have to go up against powerful platforms that can be worth billions of dollars but provide no security for buyers and sellers. If someone is hacked or tricked, these sites accept no responsibility, “which is frustrating, because they’re the gatekeepers of their little community.”
“If you get your credit card stolen, you can call your bank up right away and they’ll say, Yep, we’ll take those charges off, no problem. But here, you make one wrong click and in ten seconds you’re out a million dollars. And no one’s going to help you. . . . Why would you do that to vulnerable people?”
Nuvan, who first became a crusader against injustice at age 6 when a Little League coach in her Wyoming home town made it clear he didn’t want a girl on the team, decided in law school that she wanted to someday be a public defender or a prosecutor in a DA’s office. Then a clerkship with Federal District Court Judge Robert Shelby convinced her that she wanted to fight white-collar crime, and that meant first joining a law firm that typically represents the accused — to learn how white-collar criminals think and operate. And then one day, about a month after joining Armstrong Teasdale, she was standing in the hallway when one of the firm’s partners asked “Does anyone know what an NFT is?” Nuvan, always a news junkie, gave him a quick tutorial. “Well, you’re the NFT lawyer now,” he said.
“I know I’m not going to be the crypto world’s favorite person,” Nuvan admits. “Honestly, I’m not trying to take down their industry.. . . But you need to be fair, you need to provide customer protection.” She’s hoping eventually to pursue a class action suit.
Sometimes though, lying in bed, she’ll think about the fact that she’s representing a client who bought a digital picture of an ape wearing a safari hat. To keep a sense of balance, she signed up earlier this year to do pro bono work helping Afghan refugees file asylum applications.
“I’m dealing with the frivolousness of the NFT world but I also literally have a life and death case of this Afghan woman and her family,” Nuvan says. “It’s super nice to set the apes aside and go meet with a real person.”