In a trademark battle between an NFT artist and a big brand, Hermès, the artist just lost

Artist Mason Rothschild thought he was sitting on a “goldmine” when he began creating digital versions of the iconic Hermès Birkin handbag and selling these as NFTs. Among them was an animated piece called “Baby Birkin” that depicted a human fetus floating inside and which was ultimately acquired by a buyer for $47,000 at the height of the NFT frenzy in May 2021.

Unsurprisingly, Hermès loved the art project less, and the powerhouse luxury brand just won a copyright infringement case against Rothschild that could have widespread ramifications for NFT creators whose inspiration is real-world goods that are protected by intellectual property laws.

Though Rothschild’s attorneys argued that NFTs are works of art shielded by the First Amendment, much like Andy Warhol’s silk-screen prints of Campbell’s soup cans, in Manhattan courtroom earlier today a nine-person jury awarded Hermès $133,000 in damages after determining that NFTs are more akin to consumer products subject to strict trademark laws that protect brands from copycats.

Hermès argued during the one-week trial that NFTs confused buyers, some of whom believed that the goods were affiliated with the brand, it claimed. Rothschild’s camp argued that confusion was minimal.

Hermès also argued that Rothschild’s “MetaBirkins” project was muddying waters that Hermès itself plans to enter eventually and for which it is actively developing plans. “If we want to bring our bag into this virtual world, there will always be a reference to the MetaBirkins,” Hermès’ general counsel Nicolas Martin reportedly told the jury during testimony.

Hermès attorneys also, per Bloomberg Law, pointed to text messages that they said show Rothschild wanting to “create the same exclusivity and demand for the famous handbag.” “We’re sitting on a goldmine,” Rothschild wrote in one text.

Physical Birkin bags range in price from $12,000 to roughly $450,000 and sometimes even more. (Sotheby’s sold one last year for $2 million; the bag was crafted from rose gold inlaid with 2,712 diamonds.)

According to the New York Times, Birkin bags require a minimum of 18 hours to make by hand, with an estimated one million handbags in the market, even as the bags continue to be perceived as among the rarest in the world.

Rothschild had apparently planned to create 1,000 MetaBirkins though had released just 100. As notes Bloomberg Law, Rothschild first sold the NFTs for around $450 each but their resale soared to tens of thousands of dollars, as with “Baby Birkin.” (Others of Rothschild’s creations include a digital Birkin bag with shaggy green fur.)

As of January 2022, when Hermès first sent Rothschild a cease-and-desist letter, Rothschild claimed that MetaBirkins had a trade volume of $1.1 million.

Hermès is accustomed to inspiring artists, though most of them can’t scale their work as easily as Rothschild. For example, there is currently a Kelly-green sculpture of a Birkin bag for sale at the high-end consignment site 1st Dibs. Cast in resin and made in 2015, a Brooklyn gallery is asking $6,500 for the piece and says others like it are available in pink, white, gold and silver.

No doubt the work itself matters, too. In response to Warhol’s 1962 series of paintings of Campbell Soup cans, the product marketing manager for Campbell Soup Company didn’t threaten him; instead, he sent a letter to Warhol, expressing the company’s admiration.

In a trademark battle between an NFT artist and a big brand, Hermès, the artist just lost by Connie Loizos originally published on TechCrunch