NFT’s are once again colliding with existing legal frameworks governing intellectual property ownership, and from the outset it appears as though NFT’s are facing an uphill battle. This once again highlights the importance of understanding the laws governing intellectual property ownership and the associated rights.
Hermès Birkin vs MetaBirkins
Hermès International (Hermès) has recently filed a lawsuit against NFT artist, Mason Rothschild in the United States District Court in the Southern District of New York. Mr Rothschild has been accused by Hermès of being:
“a digital speculator who is seeking to get rich quick by appropriating the brand MetaBirkins for use in creating, marketing, selling and facilitating the exchange of digital assets known as non fungible tokens” which “rip off Hermès famous BIRKIN trade mark by adding the generic prefix meta to the famous trade mark BIRKIN”.
Mr Rothschild established the website ‘MetaBirkins’ on which he depicts series of 100 unique NFT’s which are images of fur covered Birkin handbags.
Hermès has a long history of producing luxury goods, developing a distinctive image and strong reputation. Hermès is arguably most well-known for the Birkin Bag which has been around since 1984. Hermès Birkin handbags are one of the most iconic, recognisable, and expensive handbags in the world. The starting price for a new Birkin handbag is around AU$12,000, depending on the material, but they regularly sell between AU$20,000 and AU$40,000 on the second-hand market – again depending on the material used in the construction and scarcity. The demand for Birkin bags is driven by the fact that they are not readily available in Hermès stores, there is a long waitlist and restrictions on the number of bags that can be bought each year. Hermès has a registered trade mark for both ‘HERMÈS’ and ‘BIRKIN’ both in the USA and around the world. Hermès also owns the registered trade dress rights in the Birkin handbag design.
Mr Rothschild was selling his Birkin NFT’s on the NFT Platform ‘Open Sea’, which subsequently removed his NFT’s from sale after being notification by Hermès of the violation of their intellectual property in December 2021.
Hermès claims are based on trade mark law in relation to the Birkin trade marks as they claim the use by Mr Rothschild constitutes trade mark infringement and dilution of ‘the famous BIRKIN Mark’. Hermès contend that as the MetaBirkins use the distinctive design of the Birkin handbag along with the use of the MetaBirkins mark, it is likely to cause confusion with those persons purchasing the NFT’s that they are authorised or sponsored by Hermès.
Mr Rothschild had previously created a ‘Baby Birkin’ that had an image of a foetus on a transparent version of a Birkin handbag. This work was sold as an NFT in May 2021 for US$23,500 and later resold for US$47,000. This first sale was treated by Hermès as a one-off artwork, for which they did not pursue Mr Rothschild. Hermès in their claims draw a distinction between the one off Baby Birkin as an artistic expression and the commercial scale of 100 NFT’s being sold under the name MetaBirkins.
Mr Rothschild is claiming that he is protected by the First Amendment as artistic expression is protected as a type of speech. However, what may work against Mr Rothschild is that the scale of use of the Birkin trade mark could be construed as commercial in nature, rather than fair use. Mr Rothschild uses the names MetaBirkins as his domain name and on social media. He also uses the hashtags of #MetaBirkins and #NotYourMothersBirkin. Furthermore, it seems that the way that Mr Rothschild is using the MetaBirkin mark is as a trade mark of his own, using the mark MetaBirkins to designate the source of his own goods and he has even gone so far to complain about counterfeit MetaBirkins appearing on NFT marketplaces.
Hermès is seeking an injunction preventing Mr Rothschild from using Hermès trade marks, monetary relief, and the transfer of the MetaBirkin domain name to Hermès along with any NFT’s sold. Mr Rothschild has stated that he will fight the case.
Intellectual property laws continue to be challenging for those artists and organisations wishing to sell NFT’s.It will be interesting to watch the outcome of this case, as we see fashion, NFT’s and trade mark infringement coming together. This will shape the way that brands seek to protect their intellectual property rights in a new frontier of art.
 Paragraph 1 of the Complaint filed by Hermes in the United States District Court, Southern District of New York.