By Tom Blitzer
Key Insights:
- Hermes wins the NFT infringement case, highlighting the digital frontier’s legal complexities.
- Artist Mason Rothschild faces permanent injunction over MetaBirkin NFTs, marking a pivotal moment in digital rights litigation.
- Trademark infringement verdict sets a precedent for intertwining blockchain technology and intellectual property rights.
In a groundbreaking ruling that further blurs the boundary between luxury brands and the crypto-world, a U.S. District Judge in Manhattan issued a permanent injunction to stop selling “MetaBirkin” non-fungible tokens (NFTs). The court sided with French fashion house Hermes in its lawsuit against artist Mason Rothschild, citing trademark infringement on the brand’s iconic Birkin handbags.
The Rise and Fall of MetaBirkin NFTs
Rothschild’s venture into the lucrative world of NFTs took a significant blow when the jury deemed his MetaBirkin collection, comprising 100 tokens linked to images of flamboyantly furred Birkin bags, an infringement of Hermes’ intellectual property.
Hermes, alleging that Rothschild was merely a “digital speculator,” claimed that the artist’s project was a deceptive “get rich quick” scheme that unlawfully exploited the Birkin brand’s cachet. According to the luxury house, Rothschild gave consumers the false impression that Hermes endorsed the NFTs, thereby violating their trademark rights.
U.S. District Judge Jed Rakoff agreed, stating, “The defendant’s entire scheme here was to defraud consumers into believing that Hermes was endorsing his lucrative MetaBirkins NFTs by his use of variations on Hermes’ trademarks.”
First Amendment No Shield in Trademark Tussle
In a crucial interpretation of the law and digital rights, Judge Rakoff asserted that Rothschild could not seek refuge behind the First Amendment to evade prosecution. In its pursuit of justice, the jury awarded Hermes $133,000 in damages earlier this year.
Despite this ruling, Rothschild allegedly continued to sell his NFTs, leading Hermes to request an injunction to halt further sales and the surrender of remaining tokens and profits. The Judge, demonstrating an abundance of caution regarding potential First Amendment issues, stopped short of ordering the transfer of the tokens but otherwise mostly granted Hermes’ request.
This lawsuit marks an important moment in the intersection of blockchain technology and intellectual property rights. It signals to the digital marketplace that legal boundaries must be respected, despite the crypto world’s decentralized nature.
Rothschild’s petition to overturn the decision or to have the case retried was declined, marking a crucial win for Hermes. This case solidifies the stand of luxury brands and their struggle for trademark protection amidst the rapidly evolving digital world, particularly in NFTs.