Trademark Dilution: Diluting Hermes Trademark, NFT Creator Lose Up to $133 Thousand

Mason Rothschild is a digital artist who created some NFT collections called MetaBirkins. His creations were inspired by the Birkin as an iconic bag designed by the famous mark, Hermes. He created 100 Birkins variety designs in different colors and patterns. Those creations have been sold and reached about $1.1 million trading volume in NFT Marketplace.

Hermes vs NFT Creator

Unfortunately, Hermes objected to Rothschild’s creation. Hermes argued that the company’s trademark would be diluted, and the potential consumers might be fooled into buying the unaffiliated virtual goods. Hermes then sued Rothschild to the USA court in the case of trademark infringement.

Rothschild refuted the argument by stating that he should be allowed to create art based on his interpretations of the world around him. He defended in “fair use” principle and argued that he was just following the past artist to depict criticism of the famous brand products, like Andy Warhol, who drew Campbell’s soup and Coca-Cola.

According to Rothschild’s argument, Hermes argued that Rothschild only used Hermes as a famous mark to capitalize on his creations to generate profits for himself.

After disputing for about a year, the court decided that Rothschild had been proven to have violated the trademark law in bad faith. Rothschild must compensate around $133 thousand to Hermes because of his action in diluting the trademark.

Trademark Dilution 

In IP Law, “dilution” refers to the use of a trademark or trade name in commerce that is sufficiently similar to a famous mark that, by association, confuses or diminishes the public’s perception of the famous trademark.

In other words, Trademark Dilution refers to the unauthorized use of and/or application for a trademark that is likely to weaken the distinctive quality of or harm a famous mark.

Jurisdictions that expressly recognize trademark dilution include the United States, the European Union, South Africa, India, Japan, and several Central and South American countries. As contained in the case, the United States owned trademark dilution law called Federal Trademark Dilution Act (FTDA).

In general, there are three types of dilutions:

  1. Blurring occurs when the unauthorized use of a famous mark weakens or impairs the distinctiveness of the trademark.
  2. Tarnishment occurs when a famous mark’s reputation is harmed through association with another similar trademark or trade name.
  3. Free-Riding, unauthorized use of a well-known mark on unrelated goods or services for, or resulting in, a positive association with the famous mark owner’s legitimate interests or benefits.

Does Indonesia have the same regulation of Trademark Dilution? 

As a Civil Law country, Indonesia doesn’t have a specific law about Trademark dilution. In Law Number 20 of 2016 on Trademarks and Geographical Indications, it’s regulated that trademark dilution is a part of well-known mark protection. It doesn’t have a significant impact or problem for Indonesia to haven’t a specific regulation about Trademark dilution. That’s enough to regulate it in the same regulation as the well-known mark.

The Importance of IP Law awareness for Digital Creators

Hermes vs. Mason Rothschild’s case could message digital creators about the importance of always being aware of the IP legal aspects when creating digital creation, especially for commercial purposes. IP awareness is essential to avoid future trademark lawsuits.

If you face such a case, we at Am Badar & Am Badar will be ready to provide quality services. In accordance with our tagline, “we listen, we evaluate, we progress.

For quality services regarding IP, contact us at  ambadar@ambadar.co.id

 

References:

www.liputan6.com

www.coindesk.com

www.techcrunch.com

www.inta.org

www.kliklegal.com

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