The limits of artistic expression were tested this week as a US jury found that NFTs, featuring the design of the famous Hermès Birkin bag, breached trademark and cybersquatting laws. The dispute surrounds the NFTs “MetaBirkins”, which were designed and sold by Mason Rothschild, a NFT artist and replicated the design of the Birkin bag, sold by Hermès. The proceeding is one of the first to address the relationship between digital art, NFTs and the physical fashion it replicates.
On 16 December 2021, Hermès sent a cease and desist letter to Rothschild in relation to the NFT collection, which allegedly made over $1 million in sales. On 14 January 2022, Hermès filed a claim against Rothschild for common law trademark infringement, false designation of origin, trademark dilution, cybersquatting, and injury to business reputation under New York General Business Law. Hermès alleged that Rothschild refused to stop selling the NFTs MetaBirkins and accused Rothschild of:
Rothschild responded to the claim via Twitter, alleging that he intended to set a precedent in the art and NFT space and that the claim by Hermès is baseless. Rothschild referenced the letter of support by Campbell Soup Company to artist Andy Warhol in 1964, which praised his artwork featuring the Campbell Soup brand, as a way to bolster his case. Rothschild stated:
I am not creating or selling fake Birkin bags. I've made artworks that depict imaginary, fur-covered Birkin bags…The fact that I sell the art using NFTs doesn't change the fact that it's art.
In March 2022, Rothschild argued that the MetaBirkins NFTs are commentary on the animal cruelty by Hermès and excessive expense of Birkin Bags. Rothchild aimed to rely on the protection of the First Amendment of the U.S. Constitution, stating in the filing that:
These images, and the NFTs that authenticate them, are not handbags; they carry nothing but meaning
In May 2022, Rothschild filed to dismiss the case, which was denied in a one-page order. In October 2022, Hermès pushed for a summary judgment which the judge also denied. On 30 January 2023, the lawsuit officially moved to trial at the U.S. District Court for the Southern District of New York.
One of the key issues in the case has been whether Rothschild's use of the Hermès trademark was artistically relevant or risked misleading consumers as to the sponsorship, endorsement or other connection to the brand.
On 8 February 2023, the jury handed down their decision in favour of Hermès, and found MetaBirkins creator, Mason Rothschild, liable on all three counts and that he is not shielded by First Amendment protections. The jury awarded Hermès roughly $133,000 in damages.
While jury trials often turn on the individual facts of any one case and the views of the jury, the decision indicates the potential limits of artistic expression in the use of trademarks in digital art. Andy Warhol may turn in his grave given the stark contrast to Campbell Soup's reaction to his works.