The recent collapse in NFT sales may have cooled general interest in the digital assets, but the legal questions they raise remain very much alive and relevant to rightsowners and creatives alike.  We reported previously about Hermés’ complaint against the creator of MetaBirkin NFTs, and the Court’s decision this week denying the creator’s motion to dismiss that complaint goes to the ever-relevant question of boundary between art and commerce.

Under the test of Rogers v. Grimaldi, when courts examine a potentially confusing title of an artistic work, they balance the artistic expression and relevance of the title against the risk that the public will be mislead.  Generally speaking, if there is any artistic relevance of the trademark or name used in the content of the work, the use will be protected by the First Amendment unless it is explicitly misleading.  When it comes to MetaBirkins, the Court acknowledged that the Rogers test applies, but, because it could not determine whether there was any artistic (as opposed to commercial) relevance of BIRKIN to the MetaBirkin NFTs and could not determine how likely consumers were to be misled or confused by the use of BIRKIN, it found it could not dismiss the complaint at this time.

Like with parody (that artist also found itself unprotected by the First Amendment at an early stage), simply claiming “artistic relevance” is not enough to defend a use of a trademark, the artist has to actually back up both that the relevance exists and that it outweighs the danger of consumer confusion.