The legal battle between Hermès International and Mason Rothschild has taken another turn with the artist calling for a new judgment and trial.
Last month, a Manhattan federal jury ruled that Rothschild was liable for trademark infringement, trademark dilution and cybersquatting, and Hermès was awarded $133,000 in damages. Earlier this month, the luxury house went a step further and filed a preliminary motion in the U.S. District Court for the Southern District of New York for a permanent injunction to try to stop Rothschild from selling and promoting his “MetaBirkin” non-fungible tokens.
Hermès had sued the 28-year-old artist, whose given name is Sonny Estival, for creating and selling 100 MetaBirkins — colorful faux-fur Birkin bag-inspired NFTs — in November 2021. The luxury brand contended the NFTs confused consumers, diluted the brand and impacted its in-the-works plans for NFTs. Rothschild and his legal team have insisted that the two-dimensional digital tokens were a commentary on fashion’s fur-free initiative, an experiment in replicating the luxury handbag’s perceived value and an act of artistic expression that is protected under the first amendment. The artist, who is also cofounder of the store, gallery and event space Terminal27 in Los Angeles, was compared to Pop Art artist Andy Warhol for his silkscreen series of Campbell Soup cans.
Hermes’ bestselling Birkin handbag has been a windfall for sales, generating more than $1 billion in volume over the past 10 years, according to Hermès executives’ testimony last month.
Rothschild’s renewed motion for judgment makes good on a post-ruling vow by one of his lawyers, Rhett O. Millsaps 2nd of Lex Lumina, that further legal action would follow. Rothschild’s legal team argues that the court’s instructions to the jury were improperly structured. Other claims included the First Amendment is not “a defense to trademark claims” but a rule of construction that shapes the plaintiff’s prima facie case — the establishment of a legally required rebuttable presumption. They also suggested that Hermès’ cybersquatting claim was unsupported by evidence and was inconsistent with the First Amendment.
Rothschild’s legal team challenged the judge’s decision to not allow testimony from contemporary art critic Blake Gopnik, whose work has appeared in The Washington Post, Newsweek and The New York Times, and whose portfolio includes a comprehensive biography of Warhol. Rothschild’s latest filings include claims that court’s “wrongful exclusion” of Gopnik “prejudiced” [the jury against] Rothschild.
In Tuesday’s opposition to Hermès’ permanent injunction, Rothschild’s lawyers requested that the court deny Hermès’ request for equitable relief. Should that not happen, they requested that the court grant Rothschild’s proposed order requiring the use of a clear disclaimer in connection with the promotion and sales of “MetaBirkins” NFT artworks.
Representatives at Baker & Hostetler LLP, which is representing Hermès, declined comment Wednesday.
Asked about the likelihood of Rothschild receiving another judgment or trial, Daniel Tysver, an intellectual property lawyer who does a lot of work in NFTs and blockchains at Forsgren Fisher, said his feeling was that the judge [Jed Rakoff] had given significant thought to the jury’s instructions, which would make it “relatively unlikely” that he would double back on that and allow for a new trial. “But this does set the stage for what the arguments will be on an appeal, when it goes up to the second circuit,” he said.
Another key challenge is Rothschild’s lawyers claim that “when instructing the jury, the court failed to implement the ‘Rogers’ test, instead instructing the jury that it could hold Rothschild liable if it found that he intended to confuse consumers.”
The 1989 “Rogers vs. Grimaldi” case established the Rogers test, or protecting uses of trademarks that implicate intellectual freedom issues. The actress and dancer Ginger Rogers sued Alberto Grimaldi and MGM over Federico Fellini’s film “Ginger and Fred” about two dancers. “The case was used for titles about movies but it’s been used to broadly set up this conflict between somebody’s trademark rights and another person’s right to create some kind of creative expression, whether it’s a movie, artwork or something along those lines. This case has been acknowledged to establish how you set up the rules to figure out, as in this case, is this trademark infringement, or is there some kind of First Amendment right to be able to use this trademark in association with your trademark expression,” Tysver said.
As for what this bodes for future cases, Tysver said, “The basic understanding is there are some limits to what you can do to someone else’s trademarks, particularly in the NFT area. If you are creating new NFTs and you are using someone else’s trademark in it to market someone’s NFTs, there are going to be limits, even if your NFTs are related to some kind of artistic work such as these furry versions of the Birkin purses. This case still stands for that. I don’t think that anything really changes with these latest filings. Even if Rothschild were to win and get a new trial, that doesn’t mean there is suddenly this unlimited, unfettered right to use other people’s trademarks.”
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