NFT Trademark Lawsuit Over Fashion Bags Heads to Federal Court

We live in an increasingly digital world. It’s imperative that the law keep up with changing tech trends, and a recently filed NFT trademark lawsuit seems ready to assist in this endeavor. Fashion bag designer Hermès — creator of the popular Birkin bag — has sued NFT creator Mason Rothschild over his MetaBirkins digital assets.

Hermès Files NFT Trademark Lawsuit Over MetaBirkins

Non-fungible tokens are one of the latest digital asset crazes to hit the market. It is a unit of data found on  blockchains — similar to cryptocurrencies — but they’re often represented by digital artwork, photos, audio and even video. The simplest of these are mere digital images, and that’s what Mason Rothschild created with his MetaBirkins NFTs.

Hermès did not take kindly to this, so they sent a trademark cease and desist letter to Rothschild. Around the same time, the NFT marketplace OpenSea removed MetaBirkins assets from its platform. Considering one of these digital handbags sold for $42,000 just a few months back, this is no minor issue for Hermès.

Upon receiving the cease and desist letter, Rothschild claimed his NFT’s fell under the fair use doctrine. He also stated that his works are protected under the First Amendment as art. After he seemingly continued to use the MetaBirkins name, Hermès filed a trademark lawsuit in federal court claiming infringement and dilution.

Not the First NFT Lawsuit

The Hermès and Rothschild NFT lawsuit is not the first regarding a digital asset. A 2021 lawsuit against Dapper Labs claimed that their offerings constituted unregistered securities. The Birkin versus MetaBirkin issue, however, is one of the first related to fashion digital assets and trademark rights. It seems a wave of NFT trademark lawsuits may pick up where initial coin offering litigation left off.

As the world becomes more digital — including with the metaverse representing an entire digital world — we can expect intellectual property violations to become more complex. So far, we’ve seen millions of dollars paid out over initial coin offerings (e.g., cryptocurrency) and other virtual assets. These legal issues will no doubt become more pervasive as we move on.

In the case of Hermès versus Rothschild, though, we’re dealing with something altogether different. “MetaBirkins” undoubtedly appropriates the “Birkins” trademark, and the addition of “Meta” probably doesn’t add much. Could Rothschild’s claims of fair use and free speech hold up in court, though? It seems he may have an uphill battle ahead of him.

Digital Assets and the Trademark Landscape

The lawsuit filed by Hermès lays out their legal argument, but it’s possible to get an idea on how this NFT lawsuit will go by viewing public actions. On Rothschild’s Instagram account and MetaBirkins website, there seems to be clear commercial intent that conflicts with fair use. Additionally, he has claimed trademark rights himself over “counterfeit” MetaBirkins assets.

The people commenting on MetaBirkins also aren’t helping Rothschild’s claim of the fair use doctrine. In the lawsuit, Hermès points out that some commentators have asked whether these artistic renditions of small handbags would get any attention if they didn’t sport the “Birkin” name. It could be argued that this points towards a likelihood of confusion.

Thus far, Rothschild has shown no sign of backing down. He even stated that he “won’t be intimidated” on his Instagram account. This means we could shortly see one of the most consequential early NFT trademark lawsuits play out. If the case makes it to the ruling phase, it will no doubt guide further intellectual property considerations in the digital and metaverse realms.