MetaBirkins-Maker Cites First Amendment in Fight Over Museum Inclusion

Mason Rothschild is pushing back against a New York court’s refusal to find that he would not run afoul of an injunction awarded to Hermès if he were to permit the display of his infringing MetaBirkins in an upcoming art exhibition. In a memo of law filed this week, counsel for the MetaBirkins-maker argues that SDNY Judge Jed Rakoff should reconsider a recently-issued opinion and order, in which he stated that he could not conclude, based on the evidence before the court, that Rothschild would not be violating the injunction awarded to Hermes if he gave permission for the works to be included in an upcoming exhibition on “Andy Warhol and Business Art.” 

Some Background: Hermès filed a trademark infringement, dilution, and cybersquatting lawsuit against Mason Rothschild in 2022 stemming from his promotion and sale of the Birkin artwork-linked “MetaBirkins” NFTs. A jury sided with Hermès early this year, finding him liable on all three of Hermès’ causes of action, and the court subsequently issued a permanent injunction barring Rothschild and “all others in active concert or participation with him” from continuing to promote the MetaBirkins, among other things. 

Amid a pending appeal of the jury verdict, Rothschild sought clarification of the scope of the injunction from court after the Spritmuseum in Stockholm sought his permission to display some of the MetaBirkins artworks in an impending exhibition. Counsel for Rothschild claimed that Rothschild would not be violating the injunction by agreeing to have the MetaBirkins works included in the exhibition, but said that they feared further legal action from Hermès, prompting them to seek guidance from the court. In an order this month, Judge Rakoff refused to find that Rothschild’s requested permission complies with the injunction, stating that the lack of concrete information provided about how the MetaBirkins works will be depicted/characterized in the exhibition makes it possible that Rothschild “‘might be using the exhibit to promote his infringing MetaBirkins NFTs or cause further confusion’ to consumers.” 

Without “a clear, concrete statement that, as the jury unanimously found, [Rothschild] designed the MetaBirkins NFTs to dupe the public into believing that Hermès was somehow behind the images, there is little reason to expect that those visiting the exhibit would understand that [his] creation and distribution of MetaBirkins NFTs was a fraudulent endeavor in which Hermès had no part,” Judge Rakoff stated in his March 13 order. 

Motion to Reconsider

Fast forward to March 27 and in the latest round of the closely-watched trademark case, counsel for Rothschild is urging the court to reconsider its order, arguing that the order: “(a) overlooks key evidence presented [by] Rothschild … showing that the museum did not ask for – and Rothschild expressly stated he would not provide – permission to use the MetaBirkins [images or title] in merchandising or for advertising purposes; and (b) wrongly accuses Rothschild’s counsel of ‘misrepresent[ing] key facts to the court’ – namely, that the museum intends to include discussion of this litigation in the planned MetaBirkins exhibit.” 

On the latter point, Rothschild asserts that a representative for the museum informed his counsel that “the museum would explain in the exhibit … that Hermès sued and won a trial against Rothschild over the MetaBirkins artworks, and that Rothschild is challenging that result on appeal.” Moreover, the museum rep also confirmed, according to Rothschild’s filing, that it “would include a disclaimer in the MetaBirkins exhibit making clear that it ‘has nothing to do with the brand of Hermès.’” 

Acknowledgment of these “overlooked facts should alter the conclusion reached by the court,” Rothschild’s counsel claims. 

Disclaimers & the First Amendment

At the same time, counsel for Rothschild argues that with the foregoing in mind, the court should have reached “the only conclusion permissible here under the First Amendment: Rothschild’s giving permission to the museum simply to display MetaBirkins artworks in the exhibition would not violate the injunction.” In furtherance of its argument here, counsel takes issue with the court’s “apparent” requirement that the museum describe Rothschild as a “fraud” in connection with his use of the MetaBirkins to reflect the jury’s findings. 

Such a “requirement by the court violates the principles that the Supreme Court has articulated for permissible compelled commercial speech,” Rothschild’s counsel argues, stating that “even when necessary to prevent commercial deception, compelled speech must be factual, noncontroversial, related to ‘the terms under which … services will be available,’ and not unjustified or unduly burdensome.” Part of the issue here, they maintain, is that Rothschild was found liable by the jury for trademark infringement, dilution, and cybersquatting – not fraud. And beyond that, it is “uncontested that no one could be defrauded into a purchase at the exhibition because the museum’s MetaBirkins exhibit would not involve any sales, and the exhibit would identify Rothschild as the MetaBirkins creator, expressly disclaiming any affiliation with Hermès.” 

“Compelling the labeling of Mr. Rothschild as a ‘fraud’ in this context would function only as a scarlet letter, not a consumer protection,” his counsel contends. 

As such, counsel for Rothschild requests that the court grant his motion and reconsider the scope of the injunction in order to clarify that he is not prohibited from providing permission to the museum to display MetaBirkins artworks in the upcoming exhibition. 

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