Hermès has filed a lawsuit against the individual behind a collection of 100 non-fungible MetaBirkins (“NFT”) tokens that include images depicting furry renderings of its famous Birkin bag. In a lawsuit filed in a federal court in New York on Friday, Hermès claims that MetaBirkins creator Mason Rothschild is “a digital speculator who is looking to get rich quick by appropriating the MetaBirkins brand for use in creating, marketing, selling and facilitating asset trading. digitally known as non-fungible tokens, “which simply” rip off Hermès’ famous BIRKIN brand by adding the generic prefix ‘meta’ to the famous BIRKIN brand. ”
Putting the groundwork in its 47-page complaint, Hermès states that as of December 2, 2021, Rothschild “advertised the MetaBirkins NFT under the MetaBirkins trademark and using the federally registered Hermès trademarks” – including its BIRKIN “recognized word mark. globally “and trade dress – without your permission and in violation of your trademark rights. In the wake of the launch of the NFTs, the first of which sold on December 3 for $ 42,000, Hermès says it notified both Rothschild and the NFT OpenSea platform on December 16, 2021 about “the blatant violation of [its] intellectual property ”by Rothschild, prompting OpenSea to remove NFTs from its platform.
Rothschild “flatly refused[d] to stop selling MetaBirkins NFTs “, according to Hermès, who states that” when OpenSea denied him to continue accessing his platform, [he] moved the MetaBirkins NFT to the MetaBirkins Rarible Store and further initiated plans to create its own decentralized exchange for the MetaBirkins NFT. “(Hermes states that Rothschild is actively seeking to” build a market for the resale, trade and exchange of its MetaBirkins NFT “via” a market named … as the MetaBirkins “community”.)
Although Rothschild declined to cease its offering or advertising of NFTs, including on its metabirkins.com domain, after receiving the letter from Hermès, it updated the website to add a disclaimer, stating, “We are not affiliated, associated, authorized , approved by, or in any way officially connected with HERMÈS, or one of its subsidiaries or affiliates. The official website of HERMÈS is available at https: //www.Hermès.com. ” However, instead of remedying the situation, Hermès says the disclaimer makes matters worse, as it “excessively uses the HERMÈS trademark three times” and also “unnecessarily links to the Hermès website and capitalizes the HERMÈS trademark” , thus creating “a confused impression among consumers regarding Hermès’ sponsorship of the MetaBirkins NFT and the MetaBirkins website”.
At the same time, after receiving the cease and desist letter, Hermès claims that Rothschild attempted to “immune itself from the legal consequences of his appropriation of the famous Hermès brands by claiming to be just an artist” and, therefore, protected by the First Amendment. Again, Hermès rejects, stating that such protections do not apply for a variety of reasons. “While a digital image linked to an NFT may reflect some artistic creativity, just as a T-shirt or greeting card may reflect some artistic creativity, the title ‘artist’ does not grant a license to use an equivalent to the famous BIRKIN brand in a calculated way to mislead consumers and undermine that brand’s ability to identify Hermès as the sole source of products sold under the BIRKIN brand.
In fact, Hermès claims that “the widespread use of the MetaBirkins trademark by Rothschild constitutes trademark infringement and dilution of the famous BIRKIN trademark”, stating that “there can be no doubt” that the “success” of the MetaBirkins NFT “stems from his confusion and dilutive use of the famous Hermès trademarks. In particular, the Hermès attorney argues that Rothschild’s extensive use of Hermès trademarks, even in connection with the NFTs themselves, as well as his use of metabirkins.com domain “in violation” is commercial in nature (which likely conflicts with its claims of fair use safeguards).
Even by hindering Rothschild by successfully claiming to enjoy fair use protections, according to Hermès? The fact that he is using the term MetaBirkins as his trademark. (As we noted last month, a potential obstacle for Rothschild to successfully claim fair use protection, such as parody, is the fact that parody defense does not provide protection when allegedly wrongful use is a designation of the source of the parody. assets of the defendant.) According to Hermès, Rothschild “has repeatedly claimed trademark rights in the MetaBirkins trademark in infringement complaining of” counterfeit NFT MetaBirkins on NFT markets “, with” the existence of false or counterfeit NFT MetaBirkins “indicat[ing] that MetaBirkins is branded as an indicator as a source.
Overall, handbag maker Birkin argues that Rothschild’s use of its brands for “marketing, [selling], and distribute[ing] the MetaBirkins NFTs “infringes its trademarks, as such unauthorized use” is likely to create confusion and error in the mind of the purchasing public and, in particular, tends and falsely creates the impression that the goods sold by [Rothschild] they are authorized, sponsored or approved by Hermès when, in fact, they are not. In addition to this, Rosthchild’s “voluntary and intentional” activities “dilute the distinctive quality of the BIRKIN brand and the goodwill associated with it”.
With the foregoing in mind, Hermès exposes common and federal trademark infringement claims, false denomination of origin, brand dilution, cybersquatting, and corporate reputation damage and dilution under the New York General Business Law. In terms of remedies, the company is seeking monetary damages, including Rothschild’s profits, and injunctive relief to prevent it from making further use of its trademarks, for example “using any reproduction, copy, counterfeit or colourable imitation of Hermès’ registered at the level Federal Marks to identify any merchandise or the provision of any service not authorized by Hermès. ”
Hermès has requested the court to require Rothschild to “surrender to Hermès for destruction all unauthorized products and advertisements in its possession or under its control bearing any federally registered trademark of Hermès or any simulation, reproduction, counterfeiting, colorable copy or imitation “.
Although “enforcement against unauthorized use of protected content in NFTs is largely no different than any other online infringement, and brand and content owners can seek relief directly from the usual suspects, such as website operators, ISPs , registrar, etc. “, according to Kilpatrick Townsend & Stockton LLP attorneys Rob Potter and Sarah Anderson, this case will inevitably raise some new and interesting questions, particularly from a remedial perspective, given that the illicit assets in question are made up of NFTs and, therefore, are stored on the blockchain. (Since blockchain transactions are linked to every previous transaction record, records generally cannot be changed once inserted; although there is a process by which an NFT can be sent to an inaccessible address, thereby presumably removing its value.)
Furthermore, should the MetaBirkins NFTs be made inaccessible, this raises questions for the individual owners of the allegedly infringing NFTs.
“Unless requested by this court,” Hermès says Rothschild “will continue to advertise and sell NFTs under the MetaBirkins brand, build a company that offers a range of virtual products and services under the MetaBirkins brand, and will ultimately preclude the ability of Hermès to offer products and services in virtual markets that are uniquely associated with Hermès and meet Hermès quality standards.
For an in-depth analysis of the merits of Rothschild’s fair use claims, you can find it here, and for a look at the likelihood of consumers being confused by MetaBirkins, you can find it here.
The case is Hermès International, et al. v Mason Rothschild, 1: 22-cv-00384 (SDNY).