Perturbed when an artist made a digital version of its coveted Birkin handbag with a reproduction of a mature fetus inside it, the luxury fashion brand Hermès watched in shock as other iterations popped up online. A Birkin with mammoth tusks affixed to it. One sporting the Grinch’s shaggy green fur. Others stamped with van Gogh’s “Starry Night” or populated by smiley emojis.
Hermès swiftly sued the artist, Mason Rothschild, over the NFT project he called “MetaBirkins,” arguing that the company’s trademark was being diluted and that potential consumers might be fooled into buying the unaffiliated virtual goods.
The case’s ramifications extended far beyond Hermès. In some of the first litigation to scrutinize the nature of digital assets sold on the blockchain, up for debate was whether NFTs, or nonfungible tokens, are strictly commodities or art shielded by the First Amendment.
On Wednesday, a nine-person federal jury in Manhattan determined that Rothschild had infringed on the company’s trademark rights and awarded Hermès $133,000 in total damages. The jurors…