Metabirkins, Cathy’s Clown, Gonzales, and more (updated)
CORRECTIONS ON ZARYA OF THE DAWN
In our January episode, we reported that the USCO had officially canceled the registration for the AI-generated work “Zarya of the Dawn” from Kris Kashtanova, but just after we published, we learned that this information was incorrect…
NO PATENT TO BE GIVEN TO INVENTIONS DESIGNED BY AI
BORED APE TRADEMARK CONTESTED
Notice of Opposition to Trademark Applications just the latest in ongoing legal battle over Bored Ape NFTs.
It appears that the NFT market has slowed down a bit since its height in early 2022, but a trademark dispute over one of the most famous NFT collections is just getting started. Yuga Labs created the NFT collection titled Bored Ape Yacht Club, where each NFT contained a profile of a cartoon monkey head adorned by various algorithm-generated accessories. Certain combinations and accessories were considered rare and thus more valuable. For reference, at least twelve Bored Ape Yacht Club NFT’s have eclipsed a $1.5 million sale price since the collections creation, with the highest sale price occurring in October 2021 when a Bored Ape NFT fetched a price just over $3,400,000 at a Sotheby’s auction.
Hoping to capitalize on their success and protect the brand, Yuga Labs filed ten trademark applications for various marks including an ape skull, the name Bored Ape Yacht Club, the shortened version BAYC, and various combinations of the words and skull design. However, on February 9, 2023, Jeremy Cahen, artist and creator of a competing NFT, filed a notice of opposition to all ten of the trademarks Yuga Labs wanted to register.
According to Cahen, Yuga Labs lacked a bona fide intent to use the alleged marks for the goods specified in the application. Cahen also alleged that Yuga Labs lacked the bona fide intent to lawfully use the alleged marks because the NFTs qualified as securities and Yuga Labs never filed proper paperwork to register the securities with the SEC. Cahen’s additional grounds include the following:
- Yuga Labs does not own the rights to the alleged marks because they appear in some of the NFTs which were sold to collectors or, in the case of one mark donated, under agreements that granted IP rights to the owner of the NFT
- The owners of those NFTs that contain the marks are free to use their NFT with the alleged mark without restriction; thus it is impossible for the mark to “function as an indication of source” of Yuga Labs
- The designation “Bored Ape Yacht Club” is deceptively misdescriptive
- The term “Ape” is generic or merely descriptive
Yuga Labs has until March 21 to respond.
The parties are quite familiar with each other as Cahen’s competing NFT is actually the subject of a currently ongoing lawsuit in which Yuga Labs has sued Cahen and Ryder Ripps, another artist, for selling unauthorized copycat versions of the BAYC NFTs. The artists filed a motion to dismiss but that was denied back December 2022. The two artists also filed an anti-SLAPP motion, arguing that their NFT collection was protected speech that critiqued racist dog whistles allegedly embedded in the BAYC collection. This motion was also dismissed. That case is till ongoing.
HERMES WINS IN METABIRKIN BAG
Are NFTs art and if so, to what extent?
Luxury brand Hermes recently won its case against Mason Rothschild, a digital artist who commissioned 100 MetaBirkin NFTs (non-fungible tokens), which were, in part, based on Hermes’ iconic Birkin luxury handbag. Rothschild created and sold the MetaBirkin NFTs through his website after running a marketing campaign. The MetaBirkin NFTs initially sold for $450 but soon rose in price on the secondary market place to tens of thousands of dollars.
Hermes took issue with Rothschild’s use of the “Birkin” trademark in connection with the minting of the NFTs and filed suit against Rothschild under trademark infringement claims. The nine-person jury found in favor of Hermes awarding the luxury powerhouse $133,000.
Mason Rothschild, for his position, argued that the use of the Birkin mark in connection with his MetaBirkin NFTs is protected under the first amendment as artistic expression. His expert witness (who was not allowed to testify before the jury) drew an analogy to Andy Warhol, and that the MetaBirkin NFTs were no different than Warhol’s famous Campbell’s soup can silk-screen prints. Any other position would be inconsistent with the freedom of expression guaranteed by the first amendment.
Rothschild’s attorneys pointed to the “Rogers” legal test. First defined in the 1989 case Rogers v. Grimaldi, the standard allows artists to use a trademark without permission as long as it meets a minimal level of artistic relevance and doesn’t explicitly mislead consumers.
This Hermes case brings up a novel issue of law, which may be implicated with more frequency in the near future, specifically because it examines how NFTs (and potentially other digital assets) should be viewed in the context of intellectual property laws. The consequences may be far ranging, and at least for now instill a somewhat still nebulous set of parameters on the use of NFTs and digital assets with respect to intellectual property rights. NFTs have long straddled the line between artistic expression and a consumer product, and this Hermes case may signal the extent where artistic expression morphs into a consumer product creating the potential for trademark infringement.
JACK DANIELS GETS AMICUS BRIEFS
Oral arguments in the case are set for March 22, 2023.
EVERLY BROTHERS RULING DETERMINES AUTHORSHIP OF “CATHY’S CLOWN”
IN THE UNITED STATES COURT OF APPEALS for THE SIXTH CIRCUIT
GARZA V EVERLY
GIBSON SETTLES GUITAR DESIGN DISPUTE
CLASS ACTION NOT CERTIFIED FOR TERMINATION OF TRANSFERS CASE AGAINST RECORD LABELS
Waite v. UMG Recordings Inc, U.S. District Court for the Southern District of New York, No. 1:19-cv-01091
TRUMP SUES WOODWARD OVER USE OF AUDIO RECORDINGS IN AUDIO BOOK
(Copyright Office RE: interviews) https://www.copyright.gov/comp3/docs/3-15-19/compendium-draft.pdf
TRUMP v. SIMON & SCHUSTER INC, et. al
GONZALEZ V. GOOGLE (LOOKING FORWARD) (Jon J.)
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