A federal judge ruled in favor of luxury retailer Hermès’ plea to permanently stop artist Mason Rothschild’s sales of "MetaBirkin" non-fungible tokens after a jury found that they infringed upon the French brand’s trademark rights of the famed Birkin bags.
Hermès' prized leather Birkin handbags typically sell for tens of thousands of dollars each.
According to US District Judge Jed Rakoff, the permanent injunction was necessary because Rothschild’s ongoing promotion of the NFTs would probably confuse consumers and irrevocably injure the company
"Defendant's entire scheme here was to defraud consumers into believing, by his use of variations on Hermès' trademarks, that Hermes was endorsing his lucrative MetaBirkins NFTs," Rakoff said in a statement. "Nothing in the First Amendment insulates him from liability for such a scheme."
NFTs are blockchain-based unique assets that can be collected and traded, and have exploded in popularity in recent years. Other companies have brought lawsuits claiming NFT creators are infringing on their trademarks and copyrights, including Nike Inc. and Miramax LLC.
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The fashion house first sued Rothschild last year over his "MetaBirkins," NFTs associated with images depicting the bags covered in colorful fur.
The trial was one of the first to reckon with how NFTs intersect with intellectual-property law and free-speech protections for art.
In February 2023, Rothschild was ordered to pay $133,000 in damages to Hermès over how US intellectual property rights are applied to digital assets.
Hermès called Rothschild a "digital speculator" and the NFTs a "get rich quick" scheme that infringed its "Birkin" trademark and created the false impression that the fashion house endorsed the tokens.
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The French fashion house also alleged that Hermès customers would be confused between the "MetaBirkin" NFT since the URLs were similar.
Rothschild, whose legal name is Sonny Estival, countered that he was commenting on alleged animal cruelty involved in the production of leather goods and should be protected under the Constitution’s First Amendment for art that uses trademarks in an artistically relevant way without explicitly misleading consumers.
Hermès said in a filing in March that Rothschild continued to market his NFTs after the jury's verdict. It asked the court to force him to stop and to turn over his remaining tokens and post-trial profits.
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Rothschild told the court that Hermès' request went "far beyond what is appropriate in a case, like this one, that involves artistic expression."
Reuters contributed to this report.
