The jury hearing Hermes v. Rothschild found the artist’s ‘MetaBirkin’ NFTs constitutes trademark infringement and trademark dilution. Scott Hervey and Josh Escovedo talk about this case on this episode of The Briefing by the IP Law Blog.

Watch this episode on the Weintraub YouTube channel here.

Show Notes:

Scott:
The jury hearing Hermes v Rothschild found Rothschild liable for trademark infringement and trademark dilution.  The matter went to trial after the judge dismissed both Hermes and Rothschild’s motions for summary judgment.  Should the court have sent the matter to the jury and what may be the basis for an appeal. We are going to discuss this case on the next installment of the briefing

Scott:
Mason Rothschild is an artist who has created a series of digital artworks called MetaBirkins. The artist claims that each work comment on Hermès’ “Birkin” handbags. is a unique, fanciful interpretation of a Birkin bag. Rothschild claims that the depiction of each bag as fur covered, Comments on the animal cruelty inherent in Hermès’ manufacture of its ultra-expensive leather handbags.  He has over 100 pieces as part of the collection and has sold over 1.1 million.

Josh:
Hermes filed suit in January 2022 alleging trademark infringement and trademark dilution.  Rothschild moved to dismiss, relying heavily on Rogers v Grimaldi. The court dismissed Rothschild’s motion because the amended complaint included sufficient allegations that Rothschild entirely intended to associate the MetaBirkins mark with the popularity and goodwill of the Hermes Birkin mark rather than intending an artistic association

Scott:
Shortly thereafter both parties moved for summary judgment.  Although the court found that the Hermes’ claims should be analyzed under the Rogers test, the court found that a genuine issue of material fact remained as to whether under the Rogers test Rothchild’s NTFs infringe and/or dilute Hermes’ trademarks.

Josh:
The Rogers court held that where the defendant’s product is artistic or expressive, the Lanham Act must be interpreted “narrowly in order to avoid suppressing protected speech under the First Amendment.”  The two parts of the Rogers test are artistic relevancy and whether the use of the mark is explicitly misleading.

Scott:
Citing to a 2012 Southern District of NY case, Louis Vuitton Mallatier S.A. v. Warner Bros. Entm’t Inc., The artistic relevance prong of the Rogers test “ensures that the defendant intended an artistic – i.e., non-commercial association with the plaintiff’s mark, as opposed to one in which the defendant intends to associate with the mark to exploit the mark’s popularity and good will. .

Josh:

Under Rogers, however, a showing of artistic relevance is easily satisfied: it is met “unless the [use of the mark] has no artistic relevance to the underlying work whatsoever,” and was instead chosen merely “to exploit the publicity value of [the plaintiff’s mark or brand].”

Scott:
This court, in denying the cross motions for summary judgment said that “there is a genuine factual dispute as to whether Rothschild’s decision to center his work around the Birkin bag stemmed from genuine artistic expression or, rather, from an unlawful intent to cash in on a highly exclusive and uniquely valuable brand name”

Josh:
In the courts order it cited to Rothschild’s comments to investors that “he doesn’t think people realize how much you can get away with in art by saying ‘in the style of'” and that he was “in the rare position to bully a multi-billion-dollar corporation” as being probative of an intent to exploit.

Scott:

Right, and this was despite the fact that the court recognized the existence of evidence which suggested that Rothschild viewed the project as a vehicle to comment on the Birkin bag’s influence on modern society.  To me it seems that the court may have evaluated the weight or veracity of the artistic relevance proffered by Rothschild.  Yes, Hermes offered evidence tending to show that Rothschild true intent was to make money and “capitalize on the hype”.  I don’t think the court can do that.  In Dillinger, LLC v. Electronic Arts, Inc the 9th circuit said ““not the role of the Court to determine how meaningful the relationship between a trademark and the content of a literary work must be; consistent with Rogers, any connection whatsoever is enough for the Court to determine that the mark’s use meets ‘the appropriately low threshold of minimal artistic relevance.’”

Scott:
Even where the use of a trademark bears “some artistic relevance” to an underlying artistic work, the First Amendment does not protect such use if it “explicitly misleads as to the source or the content of the work.  A work is “explicitly misleading” if it “induces members of the public to believe” that it was created or otherwise authorized by the plaintiff. In the 2nd circuit, “This determination is made by application of the Polaroid factors,” As the 2nd Cir said in Twin Peaks Prods., Inc. v. Publ’ns Int’l, Ltd., the opinion written by the same judge who wrote the Rogers opinion, If, after applying the Polaroid factors, a likelihood of confusion is found, it must be “particularly compelling to outweigh the First Amendment interest recognized in Rogers.  The Rothschild court said “Because there remain substantial factual disagreements between the parties with respect to many — if not most — of the eight Polaroid factors, any of which could be dispositive to the outcome, the Court declines to grant summary judgment for either party on this issue.  Does this sound like the court kept in mind what the 2nd cir had said in Twin Peaks?

Josh:
In Rogers v Grimaldi, the court gave some examples of what would constitute “explicitly misleading” such as a book title “Nimmer on Copyright” for a treatise that was not authored by Nimmer, or “Jane Fonda’s Workout Book” for a book Jane Fonda had nothing to do with.

Scott:
According to the motions for summary judgment filed by both parties, there doesn’t see, to be that type of evidence.    Hermès pointed to a study it commissioned that found a 18.7% net confusion rate among potential consumers of NFTs, and noted third party social media posts which mistakenly assumed an association and the fact that an IP lawyer in Paris wrongly stated that Hermès and Rothschild collaborated on the METABIRKINS NFTs. According to Hermes, this lawyer thought this because “the names of the NFTs include the famous trademark ‘BIRKIN’ and reproduced the shape of the bag.”  Rothschild pointed out the fact that he never made any affirmative statement linking his project and.  When several publications mistakenly reported an affiliation between Hermès and the MetaBirkins project.  To the contrary, Rothschild’s publicist asked that these publications issue corrections regarding the mistaken affiliation. Rothschild included a disclaimer.  Josh, do you think this rises to the level of explicitly misleads as to the source or the content of the work

Scott:
And as to Hermes dilution claim, Jack Daniels v VIP products held that the noncommercial use of a mark is expressly excluded from being actionable as blurring or tarnishment. In VIP the court’s stated that “speech is noncommercial if it does more than propose a commercial transaction” and that the “use of a mark may be “noncommercial” even if it is used to “sell” a product”.  The court allowed Hermes dilution claim to go forward.