The Hermès lawsuit involved Rothschild's MetaBirkins NFT collection. The jury awarded $133,000 in damages to Hermès, determining that Rothschild did, in fact, profit off Hermès' goodwill by producing NFTs based on the design house's Birkin bags.
The jury also decided the NFTs were not protected under the First Amendment of the U.S. Constitution, as Rothschild's lawyers had argued during the trial.
The case sets an important precedent for NFT creators and builds the framework for intellectual property (IP) law as it relates to digital creations. Down the line, creators like Rothschild might have to be more careful creating NFTs with other brands' IP to avoid future trademark lawsuits.
David Leichtman, Leichtman Law managing partner, told CoinDesk TV on Tuesday that the case wasn’t necessarily about Mason Rothschild’s use of the protected Birkin brand. Rather, it was about whether he intended to mislead consumers into believing the MetaBirkin NFTs were associated with Hermès’ flagship product.
“The question is, were [consumers] really going to be confused by the MetaBirkins, whether or not the relevant consuming audience for Hermès products would be confused by the defendant’s works,” said Leichtman.
Hermès filed suit against Rothschild in January 2022 after the Los Angeles-based artist released an NFT collection titled MetaBirkins based on the brand’s iconic Birkin handbag. In the filing, the fashion house claimed that Rothschild was "stealing the goodwill in Hermès' famous intellectual property to create and sell his own line of products," which could create confusion among its consumer base.
Rothschild argued that his project was simply art that provided a larger commentary on the fashion industry, and that his artistic expression was protected by the First Amendment.
After a year of battling over trademark infringement allegations, the Hermès vs. Metabirkins lawsuit came to trial beginning Jan. 30.
Trying the case relied heavily upon the Rogers v. Grimaldi standard, also known as the Rogers test, which examines the balance between artistic expression and trademark infringement.
Over the course of the trial, Hermès and Rothschild brought in experts on trademark law and NFTs to provide testimonies that focused on consumer confusion as well as brand dilution.
In closing arguments on Monday, Hermès’ lawyer Oren Warshavsky reiterated that Rothschild’s MetaBirkin NFTs not only misled consumers into believing the two brands were related, but that the use of the Birkin name in the NFT collection weakened the Hermès’ brand.
After the verdict was released, Rothschild posted a Twitter thread about the precedent that the case will set for artists in the future in regards to creativity and IP.
"Take nine people off the street right now and ask them to tell you what art is but the kicker is whatever they say will now become the undisputed truth," said Rothschild in a tweet. Later in the thread he continued, "What happened today was wrong. What happened today will continue to happen if we don’t continue to fight. This is far from over."
UPDATE (Feb. 8 21:05 UTC): Added Twitter reaction from Rothschild.
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