Case Name: Hermès International v. Mason Rothschild (MetaBirkins Case) – USA

Citation: Hermès Int l v. Rothschild, Case No. 1:22-cv-00384(S.D.N.Y. Feb. 8, 2023), appeal pending, No. 23-1087 (2d Cir.).

Court: United States District Court for the Southern District of New York; appeal before the United States Court of Appeals for the Second Circuit.

Corum/Judges: Judge Jed S. Rakoff in the District Court, Judge Dennis Jacobs, Judge Raymond J. Lohier Jr., and  Judge Denny Chin (based on the reports)

Introduction

The case Hermès International v. Mason Rothschild is a landmark in the history of trademark law as it seeks to balance Intellectual Property Rights and artistic freedoms. Famously known as the MetaBirkins case, it pertains to non-fungible tokens (NFTs) in the digital era. First filed in January 2022, the dispute involved luxury brand Hermès and artist Mason Rothschild, who created and sold NFTs depicting fur-covered Birkin handbags. Hermès alleged that Rothschild’s MetaBirkins infringed trademark and trade dress rights, diluted its brand, and amounted to cybersquatting. Rothschild defended his work as protected artistic expression under the First Amendment.

The district court sided with Hermès, citing consumer confusion and issuing a permanent injunction. This NFT trademark dispute has sparked significant debate around the intersection of intellectual property and digital art. The Second Circuit is now reviewing the appeal (as of May 2025), and its decision will shape the future of trademark law for virtual goods and the metaverse.

Facts

In December 2021, Los Angeles-based artist and marketer Mason Rothschild released 100 NFTs called “MetaBirkins.” These were digital images of faux-fur-covered Birkin handbags, each sold for around $450. The project generated over $1.1 million through primary and secondary sales. Hermès, which owns the federal trademark for the “Birkin” mark and its trade dress, filed a lawsuit in January 2022. They accused Rothschild of trademark infringement, dilution, and cybersquatting through his use of the “metabirkins.com” domain. Hermès argued that the NFTs caused consumer confusion, diluted the brand, and interfered with its own NFT plans. Rothschild claimed his work was protected artistic expression and included disclaimers to prevent confusion.

On May 5, 2022, the court rejected Rothschild’s claim that the First Amendment protected his MetaBirkins. It also denied his request for an interlocutory appeal on October 5, 2022. Then, on December 30, 2022, the court dismissed the contentions of both parties due to unresolved factual disputes. An eight-day trial took place, comprising a nine-person jury to investigate the matter. The nine-person jury unanimously observed Rothschild liable on February 8, 2023, for trademark breach, dilution, and cybersquatting. The court awarded Hermès $133,000 in total compensation $110,000 for trademark infringement and dilution, and $23,000 for cybersquatting.

In addition to the monetary damages, the court issued a permanent injunction prohibiting Rothschild from creating or selling MetaBirkins and ordered him to transfer the domain back to Hermès. Rothschild filed an appeal with the Second Circuit in July 2023, and the hearing took place on October 24, 2024. In 2024, Rothschild was seeking permission to demonstrate MetaBerkins in a Swedish museum for exhibition, but the court, led bebyudge Rakoff, denied it as a violation of the injunction. As of now, the Second Circuit decision is pending. 

Issues

• Has Rothschild’s MetaBerkins NFTs breached Hermès’ trademark rights by causing consumer confusion or dilution?
• Were the MetaBerkins safeguarded as artistic expression under the canopy of the First Amendment, as evaluated under the Rogers v. Grimaldi test?
• Did Rothschild’s use of the domain constitute cybersquatting?
• How do the trademark laws apply to the NFTs?

Reasoning

The main principle which was followed in this case was the Rogers v. Grimaldi test. This test was applied by the district court, which safeguards trademark use in expressive works until the use. 

1. Lacks artistic relevance 
2. Explicitly misleads consumers as to the source.

The jury found that Rothschild failed both prongs of the Rogers test, concluding that his NFTs functioned primarily as commercial products rather than artistic expressions. He used the Birkin mark as a source identifier, not as commentary or critique. A survey revealed that 18.7% of NFT buyers believed MetaBirkins were affiliated with Hermès, demonstrating clear consumer confusion. Media outlets further reinforced this perception by widely linking the NFTs to the Hermès brand. Drawing on the precedent set in Jack Daniel’s v. VIP Products, the court emphasized that the Rogers test does not apply when a trademark is used to brand a product as Rothschild did by naming his NFTs ‘MetaBirkins’.

The Jury observed that the domain registration by Rothschild was not in good faith, as it was creating confusion among the consumers and trying to earn profit from the Hermès mark’s goodwill. Despite this, Rothschild continued to promote the MetaBirkins even after the verdict, which risked the ongoing harms to Hermès, so the court’s permanent injunction was valid and justified. Rothschild in his appeal, contented that the court has misapplied the Rogers case, only focusing over the commercial intent and ignoring the artistic aspect, while Hermès firmly maintains that the NFTs function as a brand, not as art, and so confused The hearing of the Second Circuit gestures to split, with some judges are in considering it to be artistic expression and others questioning Rothschild’s exploitation of the Hermès brand.

Critique for NFT Trademark Dispute

In the very first instance, the district court correctly upheld Hermès’ trademark rights, noting the consumer confusion and how Rothschild used the mark as an identifier aligning the case closely with Jack Daniel’s. This high-profile NFT trademark dispute challenges how far artistic expression can stretch when it intersects with established brands. The application of Rogers may have been overly narrow, underestimating the MetaBirkins’ commentary on luxury culture, akin to Andy Warhol’s work. Still, the jury dismissed the First Amendment defence, raising concerns about chilling artistic freedom in the NFT domain. The cybersquatting finding, based on Rothschild’s use of the “MetaBirkins.com” domain, further supported Hermès’ claims. This NFT trademark dispute also exposed the lack of legal clarity on how traditional trademark protections apply to digital goods a gap the Second Circuit may soon address to ensure robust enforcement while preserving creative innovation in the metaverse.

Impact of this NFT Trademark Dispute

• Trademark Applicability in the Virtual World: This ruling might provide the rigidity in the owner’s right to protect the trademark against the unlawful use, specifically in the metaverse.
• Artistic Expression and The NFTs:  This may be a caveat to the artists to create the NFT-based works referencing trademarks, but still final verdict is awaited.
• Legal Precedents: The final decision may set the guidelines for the use of principles like Rogers and Jack Daniels to NFTs and will influence future conflicts.
• Brand Strategies and Cultural Debates:  Accelerating awareness in the trademark registration by the luxury brands for the digital goods and taking action against, as seen in Hermès’ NFT plans. Also, it has arisen as a topic of discussion in the art and NFT communities, with Rothschild getting support for defending artistic freedom.

Wrapping Up the NFT Trademark Dispute

Hermès International v. Mason Rothschild (MetaBirkins Case) is an epic case in the history of trademark law in the digital era, highlighting the conflict between protecting intellectual property and preserving artistic expression. As a leading NFT trademark dispute, the district court verdict aligns with Hermès’ favour to reinforce the strength of trademark rights in the digital world, though concerns remain about restricting creativity in the NFT ecosystem. The verdict of the Second Circuit is still pending and will address the application of Rogers and Jack Daniel’s, offering much-needed clarity on how trademark laws govern digital assets. This NFT trademark dispute underscores the urgent need to adapt legal frameworks to the unique nature of NFTs and the metaverse, ensuring a balance between brand protection and artistic innovation.