French luxury design firm Hermès International SA’s trademark case against digital artist Mason Rothschild is the first of its kind, drawing on the boundaries of artistic expression and the perspective of decades of intellectual property law. From, test how non-fungible tokens are seen.
Hermès plans to sue a federal jury in Manhattan on Monday that Rothschild violated trademark law by creating and selling a “Meta Birkin” NFT depicting a digital image of the famous Birkin handbag.
Rothschild, however, would argue that the MetaBirkin NFT is a work of art, no different from Andy Warhol’s silkscreen prints on Campbell’s soup cans, and therefore protected by the First Amendment. It shows a Birkin handbag worth tens of thousands of dollars in life. Instead of leather, it’s covered in cartoony, colorful fur.
Rothschild says his 100 MetaBirkin NFTs, released at the Art Basel fair in Miami in late 2021, will provide commentary on how society assigns artistic value to status symbols and expensive commodities. said.
“We are coming to a time when there has been an avalanche of events in recent years in terms of trademark law, First Amendment, and technological change,” he said. Felicia Boyd, Head of IP Brand, Norton Rose Fulbright US LLP. “Both sides’ legal teams are highly skilled and have worked their issues out for long-term review.”
Rothschild is represented by Lex Lumina PLLC, a recently founded intellectual property law firm made up of a group of prominent intellectual property scholars from Harvard University, New York University, and the University of California, Los Angeles.
Even if Rothschild wins before a jury, the fact that Hermès’ case has gone to trial means that the NFT art community could face legal troubles for incorporating the trademark into their work. It may have already sent a signal that it is possible.
“This question is very interesting because we need to determine exactly what an NFT is.” Guy Shah, Senior Advisor, Greenspoon Marder LLP. “Are they artistic expressions or are they functional products?”
In a lawsuit filed in the United States District Court for the Southern District of New York a year ago, Hermès alleges that Rothschild’s use of the name “MetaBirkin” for his NFT project improperly appropriated the Birkin trademark. bottom.
The complaint cites social media posts and reports that consumers were tricked into thinking the NFTs were created or endorsed by Hermès, which they are not.
Hermès accused Rothschild of undermining fashion brands’ ability to enter the NFT space, which has seen explosive growth since the start of the pandemic.
NFTs use blockchain technology to link images to unique digital identifiers and are especially popular among digital artists.
Rothschild may try to argue that consumers won’t get confused by using the trademark on real-world handbags while Hermès uses it on their digital assets, but that’s probably not enough. Lawyer says.
Hermès does not currently sell NFTs, but says that “the fashion industry is one of the standard bearers of digital assets.” Michelle CookIP Attorney at Arent Fox Schiff LLP.
As other brands and fashion houses such as Louis Vuitton UK Ltd., Gucci and Nike Inc. start selling their own NFTs, modern consumers believe Birkin-labeled NFTs are sold by Hermès. There is a possibility.
Consumer confusion is not just about what specific brand owners are and aren’t doing, but what’s going on with the industry as a whole.
IP attorney Jessica Nia Macdonald He noted that many brands have begun expanding their trademark registrations to include digital assets. “Naturally, many of these applications are intended-for-use,” she said. This means that these brands are not yet selling NFTs.
Art or digital ripoff?
Throughout the lawsuit, Rothschild’s attorneys have continually pointed to the Rogers Test, a balance test between free speech and trademark rights, to argue that MetaBirkin is protected speech.
The test first defined in the 1989 judgment Rogers vs Grimaldiallows artists to use the trademark without permission in their own work, as long as the use has a minimal level of artistic relevance and does not explicitly confuse consumers.
Rothschild filed a motion to dismiss last February, claiming his NFT passed the Rogers test. A Harvard law professor said anything other than an early dismissal would have a “chilling effect” on artists who wanted to portray or criticize brands but didn’t have the money for a legal defense. rice field. Rebecca Tashnetrepresented him at the hearing last May.
Justice Jed S. Rakoff was not convinced. He decided that Rogers’ test was likely applicable to this case, but that more factual information was needed to assess it.
The parties each moved to secure a pretrial victory after collecting consumer surveys and testimony from art critics, but Rakoff again denied the move late last year. As of Friday, the judge has not released an opinion explaining his decision.
Determining whether an NFT project is protected art or a digital imitation subject to trademark law is no easy task. Jeremy Goldman co-chair of the Blockchain Technology Practice Group at Frankfurt Kurnit Klein & Selz PC.
“Even if one oil-on-canvas painting is sold in a gallery, no one treats it as a commodity or a consumer product,” he said. “But when he sells 100 posters of the same painting, it starts to look like a commodity.”
Hermès argued in court filings that Rothschild’s actions, including the creation of a domain name and social media handle named Birkin, contributed to consumer confusion.
Rothschild countered that the fact that he markets and sells his art does not mean that it is no longer art.
Rothschild art often comes in the form of NFTs traded on digital markets, which could create the perception that the Rothschilds are selling digital assets that “just happen to have this art attached”. .
“But again, physical artwork is also traded on the market,” he said.
The U.S. Supreme Court in November define boundaries of the Rogers test. In that case, Jack Daniel’s Properties Inc. turned his VIP Products LLC, a dog toy maker, into a unique shape of a Jack Daniel’s Whiskey bottle with poop-related puns based on the actual product’s label. They sued for making chew toys.
VIP Products and other prominent intellectual property lawyers claim the toy is a “humorous parody” protected by the Rogers test.
Whatever the outcome of the trial, the High Court’s guidance on the Rogers test will play an important role in future appeals and new NFT cases, Boyd said.
Hermès is represented by Baker & Hostetler LLP. Rothschild is represented by Lex Lumina PLLC and Harris St. Laurent & Wechsler LLP.
the case is Hermes International v. RothschildSDNY, No. 1:22-cv-00384, 30 January 2023 Jury Trial Set.