Author: Olivier Vrins and Alexander De Bleeckere
On 8 February 2023, a New York jury delivered its long-awaited verdict in a case brought by the French luxury brand Hermès, against the artist Mason Rothschild. The latter began selling NFTs (“non-fungible tokens”) of the iconic Hermès Birkin handbags, which take their name from the Anglo-French actress and singer, Jane Birkin, in late 2021. According to Hermès, that infringed its trademark rights, and the jury agreed. Rothschild must pay $133,000 in damages (i.e. plus minus 125,000 euros
The ‘ball’ in this case started ‘rolling’ when Rothschild presented his Metabirkins collection at Art Basel Miami in December 2021 and began selling it through NFT platforms like OpenSea. The collection consisted of 100 NFTs with digital images of Hermès Birkin bags in various designs. The starting price for one copy was 0.1 ETH (about $450 at the time). The artist was said to have soon sold more than $1 million worth of digital handbags.
After a formal notice from Hermès, OpenSea removed the Metabirkin collection from its platform. Rothschild, however, refused to stop selling his virtual handbags. He invoked his artistic freedom of expression based on the First Amendment of the U.S. Constitution.
Unimpressed with this argument, Hermès decided to file suit in the U.S. District Court for the Southern District of New York. Finding in favour of the French fashion house, the jury decided that Rothschild was guilty of trademark infringement (among other things). The artist was also convicted of cybersquatting by unlawfully registering the MetaBirkins.com domain name to promote the NFTs.
The case and ruling have been followed with great interest by IP professionals worldwide, as it is one of the first tests of whether existing IP law, and in particular trademark law, is sufficiently resilient to deal with the emergence of new Web 3.0 applications such as NFTs.
Of course, there is still a long way to go and the (case) law will continue to evolve. However, cautiously one or two conclusions can be drawn from this case.