Hermès’ MetaBirkin NFT dispute and the future of metaverse IP

In January luxury French fashion house Hermès sued a digital artist for copying its Birkin handbag through the issuance of MetaBirkin non-fungible tokens (NFTs).

For those not aware of the filing or related media attention, the artist, Mason Rothschild, created fuzzy images of the Hermès Birkin handbag and minted them as NFTs.

NFTs are digital records of data stored on a blockchain and uniquely identifiable. NFTs are associated with a larger digital file that is itself too large to store in a blockchain. The digital record can then be traded or sold as an asset identifying the NFT owner as the true owner of the original digital file.

Using NFTs has, in part, allowed digital artists to associate ownership in an original version of their art through the NFT that can be monetised, much like physical paintings or sculptures created by artists in the three-dimensional world.

The artist named in the lawsuit branded his images ‘MetaBirkins’ and is attempting to sell them on various internet sites using MetaBirkin as a brand name. Hermès is suing him for trademark infringement, trademark dilution and cybersquatting. The fashion house based its allegations of trademark infringement and dilution on the artist’s use of MetaBirkin as a trademark to promote his NFTs and at his metabirkin.com website.

Success not guaranteed

A review of the complaint leads to the conclusion that the artist may expect a rebuke, but under established trademark law Hermès’ success is not a given.

The lawsuit raises all sorts of questions for brand owners, artists, and almost any business owner relating to their IP rights when it comes emerging technology, whether it is the metaverse, NFTs, or other expressive media that have not yet been conceived.

Fundamentally, the images and related NFTs are expressive works and are given a large latitude to avoid rulings of trademark infringement under the Second Circuit’s test in Rogers v Grimaldi (1989).