MetaBirkin Result provides early case law in growing area of NFT infringements

15 February 2023

A first instance decision has been reached on MetaBirkins, identifying Non-fungible tokens (NFTs) as ‘consumer goods’, in this particular case, and providing some much needed case law in the growing area of NFT infringement.

The result in Hermes International v. Mason Rothschild represents over a year of trademark infringement arguments, with the court tasked with assessing whether the MetaBirkin, an NFT of Hermes’ famous Birkin bag designed by artist Mason Rothschild, could confuse consumers into believing that the NFTs were officially affiliated with Hermes.

Hermes has yet to develop their own line of NFTs but has suggested they intend to in the future, so the existence of the MetaBirkins could potentially impede their entrance into the Metaverse.  Although the NFTs were designed to look like Hermes bags, Rothschild claimed they were actually a comment on the fashion industry and therefore constituted artistic expression, which was protected under the First Amendment.

Much of the argumentation focused on the Rogers v. Grimaldi result, or the ‘Rogers Test’ which is often used to asses whether or not a potential trademark infringement has artistic relevance to the original intellectual property, or whether it has been designed specifically to mislead consumers into believing there is an official association with the owner of a particular trademark. Following just over a week of trial, the jury found that the MetaBirkins did pass the Rogers test, and that Rothschild’s actions constituted an intention to mislead consumers.

The name itself, ‘The MetaBirkin’ as well as the purchase of a MetaBirkin related domain name were used by Hermes Defence team to demonstrate Rothschild’s intention to drive interest in the artwork, through association with the luxury brand. Text messages sent by Rothschild referring to his project as a ‘goldmine’ were also presented in court, all of which led the jury to conclude that the artwork was part of an attempt to enrich himself via association with the brand rather than the ‘artistic endeavour’ he claimed it to be. The NFTs in this instance could therefore be considered as competition to the Hermes’ Brand, in a way that art designed to be included in a museum collection might not be.

Although the infringement in this case was largely focused on the sale and marketing of the NFTs, rather than the artwork itself, it does mean that artists will need to approach NFTs with more care than they have done so far. The decision in the case was very ‘fact-specific’, and therefore does not necessarily impact on the rights to artistic expression afforded under the First Amendment, it does however, represent some much needed case law within the fast growing space of NFT infringements. It provides a potential defence for rights owners in the future by suggesting that the same tests should be applied to digital rights infringements as those applied in the real world.

Renaud Permezel, Digital Brand Consultant at Zacco suggests “the case law is only valid in the US but courts in other countries are likely to take note when similar cases inevitably land on their books. The decision means that brand owners should start to look into defending their own trademarks and brands in the NFT space because courts will be open to exploring potential defences when they start developing their own case law in this emerging area.”

For more information on how to expand, enhance and protect your IP rights in the NFT, Metaverse and Web3 spaces, reach out to Renaud, Kristian Elftorp or Hampus Adlerton.