Hermès Seeking Permanent Injunction After MetaBirkins Trial Win

Image: MetaBirkins


Hermès Seeking Permanent Injunction After MetaBirkins Trial Win

In the wake of a favorable jury verdict last month, in which a New York federal jury found that by way of the MetaBirkins NFTs, Mason Rothschild is infringing and diluting Hermès’ famed Birkin trademarks, Hermès is looking to get the court to permanently block ...

March 6, 2023 - By TFL

Hermès Seeking Permanent Injunction After MetaBirkins Trial Win

Image : MetaBirkins

Case Documentation

Hermès Seeking Permanent Injunction After MetaBirkins Trial Win

In the wake of a favorable jury verdict last month, in which a New York federal jury found that by way of the MetaBirkins NFTs, Mason Rothschild is infringing and diluting Hermès’ famed Birkin trademarks, Hermès is looking to get the court to permanently block Rothschild’s promotion and sale of the NFTs on the basis that he will continue to engage in infringement if he is not stopped. In a motion for preliminary injunction (and corresponding memo in support) dated March 3, counsel for Hermès states that in light of its position as the “prevailing party in a trademark infringement suit” and given Rothschild’s enduring promotion of – and collection of royalties in connection with – the MetaBirkins NFTs, it has “no choice but to seek a permanent injunction.” 

Setting the stage in its filing, counsel for Hermès cites jury instructions from the case, in which the court stated that “Hermès prove[d] that Mr. Rothschild actually intended to confuse potential customers” by way of the MetaBirkins NFTs. However, “Rather than treating the jury verdict as a final adjudication,” Hermès claims that Rothschild has been “brazenly violating [its] intellectual property rights.” In particular, Hermès contends that “shortly after the verdict was rendered,” Rothschild has “continued acting as he has since November 2021” by promoting “the sale of METABIRKINS NFTs on the METABIRKINS website and METABIRKINS Instagram and Twitter accounts,” all of which link to the METABIRKINS page on LooksRare where METABIRKINS NFTs can be purchased, and with “Rothschild [setting] a 7.5% royalty for METABIRKINS NFTs sales” on the NFT-specific marketplace.

As for Rothschild’s and his counsel’s continued promotion of the MetaBirkins NFTs after the jury returned its verdict, Hermès alleges that they have launched an “ongoing publicity campaign surrounding the METABIRKINS NFT” by way of social media posts, as well as a podcast appearance and Washington Post article, entitled “A misguided jury failed to see the art in Mason Rothschild’s MetaBirkins,” from Rothschild’s expert, Dr. Blake Gopnik. “Rothschild’s counsel and Dr. Gopnik – whether intentional or not – have helped promote the METABIRKINS NFTs by posting about METABIRKINS on Twitter and Instagram, including sharing articles from The New York Times and the Washington Post,” per Hermès.

MetaBirkins NFTs on LooksRare

Delving into its push for a permanent injunction, Hermès asserts that “there was no dispute at trial that the BIRKIN trademark and design mark – and the goodwill associated therewith – is an extremely valuable asset,” especially since “the BIRKIN handbag has become one of Hermès’s most iconic products, if not its most iconic product.” The company claims that it “brought this action because Rothschild was capitalizing on the very substantial goodwill of Hermès’s BIRKIN trademarks … with the goal to create a digital commodity,” and that “substantial consumer confusion ensued,” with Rothschild “admit[ing] to the actual consumer confusion” at trial. 

“Based on Rothschild’s infringing conduct, his public conduct, his statements made in private to his friends and associates, and false testimony,” Hermès asserts that the jury “fairly concluded that neither he nor his claims of artistic motive were credible.” (Among Rothschild’s problematic conduct, per Hermès, was his attempt to “pump prices” for his earlier Baby Birkin NFT by being the first to bid on the NFT and then placing two different, additional bids.) Still yet, Hermès claims that it presented evidence at trial “showing it was irreparably harmed by Rothschild’s conduct, [and that] Rothschild’s METABIRKINS NFTs interfered with Hermès’s own NFT plans, which it has been developing since December 2019.” 

With the foregoing in mind and “in light of the jury verdict on [its] dilution and trademark infringement claims,” Hermès states that the court “may presume irreparable harm,” and that such a presumption is “warranted because the jury found that ‘Rothschild’s use of the Birkin mark was not just likely to confuse potential consumers but was intentionally designed to mislead potential consumers into believing that Hermès was associated with [his] MetaBirkins project.’”

According to Hermès, the evidence at trial further confirmed that the METABIRKINS NFTs: “(1) caused Hermès to lose control of the BIRKIN mark’s reputation, and (2) diluted the distinctiveness of the BIRKIN Mark. For example, Hermès introduced evidence of: (i) a text from Rothschild admitting to actual confusion; (ii) various press articles showing actual confusion concerning Hermès association with the METABIRKINS NFTs, including L’Officiel, Elle, New York Post, and Challenges; (iii) Rothschild admitting to such confusion to his business partners; (iv) comments on Rothschild’s social media showing potential purchasers were confused, and a social media user complaining that she was ‘scammed’ by Rothschild because she thought she was getting a real purse; and (v) Dr. Isaacson’s consumer survey finding there was a substantial likelihood of confusion among NFT purchasers.” 

Rothschild’s “past and present conduct demonstrates he is likely to continue infringing Hermès’s trademarks if a permanent injunction is not issued,” Hermès asserts, asking the court to enjoin and restrain him, as well as “his associates, business partners, influencers, representatives and other affiliates,” etc. from “minting, issuing, producing, distributing, circulating, selling, marketing, offering for sale,” etc. “any products and/or merchandise, including NFTs, that use the BIRKIN trademark, BIRKIN trade dress or any confusingly similar METABIRKINS name or mark.” 

Additionally, Hermès wants the court to block Rothschild and co. from: (1) “making any statement or representation whatsoever or performing any act that is likely to lead the trade or public to believe that any NFTs, products or merchandise minted, manufactured, promoted, distributed or sold by Rothschild, including the METABIRKINS NFTs, are in any manner associated or connected with Hermès or its BIRKIN trademark or trade dress;” (2) using METABIRKINS or any BIRKIN-formed mark as a trademark to promote any products or business; (3) registering, using or trafficking any domain names or social media or NFT platform usernames or handles that are identical or confusingly similar to the BIRKIN trademark, including METABIRKINS; and (4) providing any benefits to holders of METABIRKINS NFTs, such as airdrops, or otherwise creating incentives for third parties to purchase METABIRKINS NFTs. 

In addition to the aforementioned remedies, Hermès is looking for the court to order Rothschild to transfer the metabirkins.com domain name and any ENS domains containing the BIRKIN mark to it. It is also seeking “the transfer of any METABIRKINS NFTs in Rothschild’s possession, custody or control to a crypto wallet designated by Hermès,” and the “transfer of control of the METABIRKINS NFTs smart contract to Hermès and, if necessary, direct a smart contract engineer or developer to assist with the transfer of control of the smart contract.” 

Some procedural background: Following a conference with the court on Feb. 24, Judge Rakoff granted Rothschild leave to file an opening brief on the issue of interviewing the jurors by March 3. (Hermès will then have until March 10 to respond.) Hermès was also granted leave to file a motion for a preliminary injunction by March 3, at which point Rothschild will have until March 10 to reply. The court granted the application to delay adjudication of the attorney’s fee issue “until an appeal has been completed or the possibility of an appeal extinguished is granted.” 

Counsel for Rothschild filed their brief under seal on March 3, and told TFL on Monday in response to Hermès’ filing, “As plaintiffs, Hermès gets to file their argument first. This case is far from over. This latest filing is a gross overreach by Hermès and an attempt to punish Mr. Rothschild because they don’t like his art, but what’s new? Mr. Rothschild will be responding in the Court in due course.” 

The case is Hermès International, et al. v. Mason Rothschild, 1:22-cv-00384 (SDNY).

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