Non-fungible token (NFT) artist Mason Rothschild was in the wrong with his MetaBirkins NFT project, Olta Andoni, general counsel at financial firm Enclave Markets, told CoinDesk TV on Thursday.
“The real intent of Mason Rothschild was to piggyback, not only on the reputation [of Hermès’], but … for his own economic benefit,” Andoni, an adjunct professor of law at the Chicago Kent College of Law, said on “First Mover.”
Earlier this week, the Paris, France-based retailer won its lawsuit against Rothschild that claimed its trademark was being diluted by the MetaBirkin project. Hermès also claimed customers would be confused by Rothschild’s project and fooled into buying virtual goods not associated with the luxury brand.
Andoni said consumer protection was one of the main concerns of the nine-person jury. Not only were they curious about the case, she said, but “they understood also that … we’re not talking only about artistic value, but we are talking a lot more about consumer confusion.”
NFTs, which can be traded and sold, give users the ability to own a digital item. However, in this case, Andoni said Rothschild intended to prop up his own brand and drive sales on the back of Hermès’ famous Birkin bags. She said Rothschild was promoting the project via his social media channels and website.
During the case, Rothschild’s counsel argued the artist's artistic expression was protected under the U.S. Constitution's First Amendment. Judge Jed S. Rakoff, however, denied Rothschild's motion to include testimony from art critic Blake Gopnik, who studies Andy Warhol. In a tweet Rothschild had likened his work to Warhol's famous Campbell's tomato soup can, including a copy of a letter from Campbell's admiring Warhol's artwork.
According to Andoni, Warhol’s soup cans had “a lot more artistic relevance,” adding that Rothschild's very short disclaimer about the project was not enough of an argument to keep him safe from a lawsuit.
The case is among one of the first to tackle free speech and trademark infringement. However, Adoni said the verdict won't stop some artists from doing their own NFT projects, so she expects to see similar cases in the future. Nonetheless, the verdict may prompt artists and brands to approach NFTs and the metaverse differently.
“This goes back to how much brands are interested in the metaverse, but at the same time they need to protect their IP [intellectual property],” Andoni said, adding that is what matters to brands the most.
She suggested a regulation, or “some precedent for courts,” would be helpful for artists that are making art and working with well-known brands.
“At the same time, in order for brands to truly approach the metaverse and NFTs, we have to understand that laws are going to be applicable to NFTs as well,” she said. “Just because you're creating this digital art doesn't mean that no consumer protection laws are applicable there.”
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