NFTs Take a Hit
Hermes of Paris (pvt) is among the most well-known global luxury item brands, generating $9.7b in sales in 2021. The company has a broad variety of products ranging from watches to fragrances, but is best known for its leather work, particularly women’s handbags, and the 1984 release of the “Birkin Bag” set a high water mark for status and quickly became collector’s items, with certain custom Birkin’s selling at auction for over $380,000 and a number of publications citing the fact that the value of Birkin bags has increased at a rate higher than that of the S&P 500.
A digital entrepreneur by the name of mason Rothschild decided that he would create NFT assets under the name “Metabirkins”, starting with “Baby Birkin” a digital image of a 40-week old fetus on top of a transparent version of a Birkin bag on his website, the success (the original NFT sold for $23,500 in May of 2021 and was resold for $47,000) of the Baby Birkin prompted Mr. Rothschild to create additional Metabirkins which he offered on OpenSea (pvt) in December 2021 using the Metabirkin trademark and advertised the NFT’s on the Metabirkin website, with links to OpenSea, Discord (pvt) and a number of other similar sites, using the Birkin mark, the Hermes mark, and the slogan “Not your mother’s Birkin” and stated “MetaBirkins are a tribute to Hermes’ most famous handbag, the Birkin, one of the most exclusive, well-made luxury accessories.”
After a letter was sent to the site by Hermes, a disclaimer was added, stating “We are not affiliated, associated, authorized, endorsed by, or in any way officially connected with the HERMES, or any of its subsidiaries or its affiliates. The official HERMES website can be found at https://www.hermes.com/”, although the disclaimer was not posted on any of the NFT sales sites. On December 26, 2021, however OpenSea removed the MetaBirkin NFTs after receiving notice from Hermes and Mr. Rothschild moved the collection to Rarible NFT (pvt) and continued to advertise the MetaBirkin digital assets, also adding the NFTs to the LooksRare (pvt) marketplace, again using the MetaBirkin trademark, and a similar offering on Zora (pvt). As of January 6, 2022 total sales of MetaBirkin NFTs were $1.1m, although Mr. Rothschild had complained publicly that there were a number of ‘counterfeit’ MetaBirkins being circulated on NFT platforms.
With Hermes requesting a jury trial, only days ago, the jury came back with three guilty verdicts, one for trademark infringement, one for trademark dilution, and one for ‘cybersquatting’, the practice of registering company or brand names, in order to sell them, and awarded Hermes $133,000. Most important however was “4th” verdict, “Having found the defendant liable for trademark infringement and/or trademark dilution and/or cybersquatting, we the jury find that the First Amendment protection does not bar liability”. This links the MetaBirkin NFTs to strict trademark rules rather than those re4lating to artwork, which has been the mantra for NFT ‘creators’ since their inception and will end Mr. Rothschild’s plans to create 1,000 MetaBirkins for which he was to receive $450 each and 7.5% of secondary sales. We assume his legal team will appeal the ruling, but we expect, at least for now, it will send a message to the NFT community that it cannot infringe on public trademarks.
A digital entrepreneur by the name of mason Rothschild decided that he would create NFT assets under the name “Metabirkins”, starting with “Baby Birkin” a digital image of a 40-week old fetus on top of a transparent version of a Birkin bag on his website, the success (the original NFT sold for $23,500 in May of 2021 and was resold for $47,000) of the Baby Birkin prompted Mr. Rothschild to create additional Metabirkins which he offered on OpenSea (pvt) in December 2021 using the Metabirkin trademark and advertised the NFT’s on the Metabirkin website, with links to OpenSea, Discord (pvt) and a number of other similar sites, using the Birkin mark, the Hermes mark, and the slogan “Not your mother’s Birkin” and stated “MetaBirkins are a tribute to Hermes’ most famous handbag, the Birkin, one of the most exclusive, well-made luxury accessories.”
After a letter was sent to the site by Hermes, a disclaimer was added, stating “We are not affiliated, associated, authorized, endorsed by, or in any way officially connected with the HERMES, or any of its subsidiaries or its affiliates. The official HERMES website can be found at https://www.hermes.com/”, although the disclaimer was not posted on any of the NFT sales sites. On December 26, 2021, however OpenSea removed the MetaBirkin NFTs after receiving notice from Hermes and Mr. Rothschild moved the collection to Rarible NFT (pvt) and continued to advertise the MetaBirkin digital assets, also adding the NFTs to the LooksRare (pvt) marketplace, again using the MetaBirkin trademark, and a similar offering on Zora (pvt). As of January 6, 2022 total sales of MetaBirkin NFTs were $1.1m, although Mr. Rothschild had complained publicly that there were a number of ‘counterfeit’ MetaBirkins being circulated on NFT platforms.
With Hermes requesting a jury trial, only days ago, the jury came back with three guilty verdicts, one for trademark infringement, one for trademark dilution, and one for ‘cybersquatting’, the practice of registering company or brand names, in order to sell them, and awarded Hermes $133,000. Most important however was “4th” verdict, “Having found the defendant liable for trademark infringement and/or trademark dilution and/or cybersquatting, we the jury find that the First Amendment protection does not bar liability”. This links the MetaBirkin NFTs to strict trademark rules rather than those re4lating to artwork, which has been the mantra for NFT ‘creators’ since their inception and will end Mr. Rothschild’s plans to create 1,000 MetaBirkins for which he was to receive $450 each and 7.5% of secondary sales. We assume his legal team will appeal the ruling, but we expect, at least for now, it will send a message to the NFT community that it cannot infringe on public trademarks.
RSS Feed