Earlier this year, Hermès filed a trademark infringement suit against Los Angeles-based designer Mason Rothschild for creating and selling faux-fur digital renditions of the luxury Hermès Birkin handbags and using a collection of 100 NFTs, titled “MetaBirkins,” to authenticate the digital images.[1] In response, Rothschild filed a motion to dismiss Hermès’ trademark infringement claim under the Rogers test on the basis that the digital images of the Birkin bags are “art” and, therefore, receive First Amendment protection.[2] Hermès opposed, arguing that the Polaroid factors— instead of the Rogers test—should apply, to assess likelihood of confusion.[3] On May 18, 2022, the court denied Rothschild’s motion to dismiss, concluding that: (1) the Rogers test applies to the trademark infringement analysis of the “MetaBirkins” title, and (2) the Polaroid factors apply to the explicit misleadingness analysis.[4]

Continue Reading In the bag (for now): Hermès survives motion to dismiss in MetaBirkin NFT lawsuit

In recent months, the metaverse, a term that is meant to encompass a mixture of virtual reality and augmented reality, has increasingly become a conversation topic for companies and consumers. Companies have begun to invest in this space and have started staking out virtual property on platforms like Decentraland and The Sandbox. Lawsuits and trademark applications have also popped up alongside these investments. This recent legal activity indicates that the metaverse will be a critical area for companies to begin to learn about and monitor to ensure they are adequately protecting their intellectual property and avoiding risk.

In January 2022, designer Hermès sued an individual named Mason Rothschild in the Southern District of New York for his creation and sale of “Metabirkins,” which are non-fungible tokens (“NFTs”) that resemble fur-covered versions of Hermès’ iconic Birkin bag. Among other things, the complaint alleges that Rothschild has engaged in trademark and trade dress dilution and infringement by selling his NFTs, one of which has already sold for $40,000, just as one would by selling a counterfeit physical bag. Interestingly, Hermès’ complaint notes that the defendant’s activity is preempting Hermès from entering the NFT market itself.
Continue Reading See You in the Metaverse: What Brands Need to Know

Earlier this month, New York State Assemblywoman Kelles and State Senator Biaggi introduced the Fashion Sustainability and Social Accountability Act in the New York State Assembly and Senate. If the legislation becomes law, it would amend New York’s general business law to require fashion companies to publicly disclose extensive information about their environmental, social, and governance (“ESG”) policies, impacts, and targets for improvement.

Specifically, the Act would require all fashion retail sellers and manufacturers doing business in New York that have annual worldwide gross receipts surpassing $100 million to disclose:

  • ESG due diligence policies and processes;
  • ESG outcomes, including actual or possible negative environmental and social impacts; and
  • Binding targets for prevention and improvement of ESG outcomes and policies.


Continue Reading Will New York’s Fashion Sustainability and Social Accountability Act Set a Trend?

On November 11, 2021 activewear apparel brand lululemon athletica canada inc. (“lululemon”) sent a cease and desist letter to interactive fitness platform Peloton Interactive, Inc. (“Peloton”), alleging that five of Peloton’s products, including four bras and a pair of leggings, were infringing upon six of lululemon’s design patents and that Peloton’s One Luxe Tight infringed upon lululemon’s Align pant trade dress.

Rather than spinning its wheels, on November 24, 2021, Peloton responded with an action for declaratory judgment against lululemon in the Southern District of New York, seeking (1) a determination that Peloton did not infringe lululemon’s design patents, (2) invalidity of these patents, and (3) a declaration that lululemon does not have trade dress rights in the Align pant and/or that Peloton did not infringe upon this trade dress. Specifically, Peloton argues that there are clear and obvious differences between its products and lululemon’s design patents, the presence of the brands’ trademarks on the products eliminates confusion, and the design patents are anticipated and/or obvious based on prior art. For example, Peloton emphasizes that the back of its Peloton Branded Strappy Bra is cut straight across and has a mesh layer, while the design patents depict a scooped back and no mesh layer, among other differences. Peloton also argues that the asserted Align trade dress does not possess the requisite distinctiveness to be protectable, and even if it does, Pelton’s One Luxe Tight is not likely to cause marketplace confusion.
Continue Reading Peloton and lululemon Yet to Work Things Out, File Cross Lawsuits

Promotional products seller Gennex Media LLC and its owner, Akil Kurji, have settled Federal Trade Commission (“FTC”) charges that they made false, misleading, or unsupported advertising claims that their “Brandnex” customizable promotional products were “all or virtually all” made in the United States. Despite numerous claims that the company’s novelty items were “Made in the USA,” “USA Made,” and “Manufactured Right Here in America!”, the items were wholly imported from China.

The settlement requires Gennex and Kurji to pay the FTC a monetary judgment of $146,249.24. In addition to the payment, the parties are required to follow post-settlement remediation measures. Some of these measures include: (1) providing customer information to the FTC in order to ensure proper customer redress; (2) submitting compliance reports to the FTC one year post-settlement; and (3) maintaining certain business records for five years.
Continue Reading Made in USA Settlement for Chinese Imports

On March 4, 2021, the Federal Circuit spoke pointedly on its view of contract interpretation and contract obligations in the context of trademark licensing agreements between private and government actors. In Authentic Apparel Group, LLC v. United States, No. 2020-1412 (Fed. Cir. Mar. 4, 2021), the court upheld the Court of Federal Claims’ decision, on summary judgment, that the Army did not violate its obligations under a trademark licensing agreement with Authentic Apparel Group, LLC (“Authentic”). Authentic, the licensee, claimed that the Army violated the terms of the licensing agreement by refusing to approve certain products and marketing materials bearing Army trademarks. These included a proposed shoe line and an advertisement featuring Dwayne “The Rock” Johnson. The Federal Circuit disagreed.

The Federal Circuit emphasized the plain language of the trademark licensing agreement, which granted the Army “sole and absolute discretion” to approve or deny Authentic’s proposed uses of the Army’s marks. Additionally, an exculpatory clause provided that Authentic would have no cause of action based on the Army’s exercise of this discretion in failing or refusing to grant approval. “Contracting parties,” the court noted, “including parties who contract with the government, are generally held to the terms for which they bargained.” This precept does not change merely because the subject matter of the contract is a trademark.
Continue Reading Deep Sixed: Federal Circuit Boots Trademark Licensee for Meritless Claims Against U.S. Army

Maryland became the first U.S. state to create a digital advertising tax on February 12, 2021. The Digital Advertising Gross Revenue Tax (DAGRT) was originally passed in March of 2020, but subsequently vetoed by Maryland Governor, Larry Hogan. Maryland’s legislature voted to override the Governor’s veto, however. The contentious journey for DAGRT passage is likely to be overshadowed by a litigious future.

DAGRT (full text here) imposes a progressive tax on the sale of digital advertising services’ gross revenue within the state. DAGRT focuses on large providers of digital advertising services; entities with revenue exceeding $100 million. The rate of the tax imposed, based on global revenue, is 2.5% for annual global gross receipts of $100 million to $1 billion, 5% for gross receipts of $1 billion to $5 billion, 7.5% for gross receipts of $5 billion to $15 billion, and 10% for gross receipts exceeding $15 billion. The rate then applies to digital advertising services’ gross revenue in Maryland. However, DAGRT does require all entities with an annual gross revenue derived from digital advertising services within the state over $1 million to file a specialized tax return. DAGRT’s focus on large providers of digital advertising services might incentivize these providers to find avenues to avoid the tax by changing their digital advertising strategies. For example, more companies may offer advertisement-free subscription options. It’s also possible that the companies faced with paying the tax may simply pass the cost on to the smaller businesses purchasing the advertisements and to consumers.
Continue Reading Maryland’s Digital Advertising Tax: A Contentious Start, and an Uncertain Future

On December 18, 2020, the Ninth Circuit Court of Appeals held that “Oh, the Places You’ll Boldly Go!,” a Dr. Seuss and Star Trek mashup illustrated book, is not a fair use exempted from copyright liability. Under the Copyright Act of 1976, the factors courts assess in determining if there is fair use include:

  1. The

On November 30, 2020, New York Governor Cuomo signed into law a bill that will allow estates and representatives of deceased individuals to defend their names and likenesses from commercial exploitation, allowing their estates to continue to control and protect their likeness after their death. The new law, which establishes a “Right to Publicity” for deceased individuals who were domiciled in New York at their time of death, allows these individuals to that have commercial value, including their name, picture, voice, or signature, against unauthorized use.

In connection with the new post-mortem right to publicity, Governor Cuomo stated, “In the digital age, deceased individuals can often fall victim to bad actors that seek to capitalize on their death and profit off of their likeness after they pass away – that ends today. This legislation is an important step in protecting the rights of deceased individuals while creating a safer, fairer New York for decades to come.” The new post-mortem right of publicity applies up to 40 years after the death of the deceased personality, and it provides certain exceptions, such as for works of art or political interest, parodies and satires, and the use of names and likenesses in the news.

In enacting this law, New York joins the minority of U.S. states which recognize a post-mortem right of publicity, an area of law that has long been controversial and which has resulted in extensive discussion of choice-of-law rules.
Continue Reading ‘Imagine’ This: John Lennon Would Have Received Post-Mortem Right to Publicity in New York

On Monday, May 20, 2019 the Supreme Court settled a decades-long circuit split regarding a licensee’s ongoing trademark usage rights following the rejection of a trademark license agreement under the U.S. bankruptcy code. In an eight to one decision, the Court found that “rejection breaches a contract but does not rescind it. And that means