Jury Returns Verdict in MetaBirkin Case, Finding Infringement

After roughly three days of deliberations, the jury in the Hermes International et al v. Rothschild found that the defendant had infringed the plaintiffs’ trademark rights. Hermés has sold its famous Birkin bags for many years. They sell at retail for six-figure amounts. Artist Mason Rothschild created NFTs (non-fungible tokens) called MetaBirkins. The NFTs looked like Hermés Birkin bags and had a range of different designs, colors and other visual effects. In 2021, Rothschild allegedly sold 100 MetaBirkins for cryptocurrency that equated to $450. Many of the MetaBirkins were resold.

Hermés asserted that the MetaBirkins confused customers and looked similar enough Birkin Bags to be infringing. Among other claims, Hermés contended that the MetaBirkins were intended to trade on and profit from the use of the famous Birkin bag mark and name. It argued that Rothschild was purely looking to profit off of Hermés intellectual property and was motivated by profit. It claimed the NFTs themselves, as well as the MetaBirkin name and domain name (metabirkin.com), infringed and diluted the Birkin mark.

Rothschild argued that the NFTs were art and that he had artistic and free speech rights to create NFTs. According to him, the motivation included creating art and commenting on both the use of fur in fashion and the concept of high-priced, luxury handbags. He further argued that whether or not he profited from the sale of his art was not the point. He testified at trial that he was not liable for infringement because his use of certain characteristics of Birkin bags and the term “Birkin” is not prevented by trademark law and was permitted as a fair use. Rothschild likened the MetaBirkin NFTs to Andy Warhol’s art. He specifically compared them with Andy Warhol’s creation of images of Campbell’s Soup cans. These defenses injected hefty legal concepts into the case. The dispute has garnered attention across the media because the result will likely have a ripple affect in the NFT community, and possibly the art world generally.

Rothschild also contended that he could not be found to have infringed because Hermés did not establish that the public was confused by the NFTs. This more practical defense focused on the facts and whether the NFTs would be assumed to be associated with Hermés, or were clearly a criticism or other commentary on luxury items. 

During trial, Hermés introduced texts from Rothschild in which he allegedly wrote, "We're sitting on a gold mine" in 2021 to a designer who worked with him to create the NFTs at issue. Other facts, such as Rothschild’s use of the term “Birkin” in the name of the NFTs and the website for offering them for sale, were all used to support the argument by Hermés that Rothschild's primary purpose was to make a profit and to do so using the “Birkin” name.

Ultimately, the jury determined that the NFTs infringed Hermés trademark rights. The jury awarded Hermés approximately $133,000 in damages, based on profits and cybersquatting. The amount is less than the full award sought by Hermés. 

Already, questions have arisen about a potential appeal. Other creators and sellers of NFTs have concerns about the verdict. As NFTs have proliferated in recent years, the law continues to struggle to keep up. It remains to be seen if the verdict will be upheld, if appealed. Also unclear is whether other courts will look to this case in deciding other disputes over the creation, use and sale of NFTs.