French luxury brand, Hermès, won its U.S. trademark infringement lawsuit against the digital artist behind the "MetaBirkin" nonfungible token (NFT). The jury, finding that the MetaBurkins are not protected artistic expression under the First Amendment, returned a verdict awarding Hermès $133,000 in damages.
This case is a tremendous win for consumer brands and a grave forewarning for NFT creators. As the first trademark/NFT case to reach decision in the U.S., this case will have a notable impact on pending and future NFT cases that straddle the line between art and infringement.
Interestingly, attorneys for Hermès were able to point to numerous text messages evidencing that the NFT creator wanted to "create the same exclusivity and demand for the famous handbag" and that "[they're] sitting on a goldmine" before initiating an extensive MetaBirkin marketing campaign through the NFT creator's social media platforms and website. This evidence likely painted a picture for the jury of the NFT creator's intent to infringe and engage in unfair competition.
In light of this case, I anticipate that we'll see a flood of trademark cease and desist letters and complaints for trademark infringement directed to the NFT space.
