Bike saddles and Hermès NFTs

Bike Saddles: when is a design “visible”?

Earlier this week the European Court of Justice gave its decision in the Monz HI mbH v Büchel GmbH case, in which it decided a dispute which arose a question which could appear to many quite surprising: when is a bike saddle “visible”?

Could it be considered “not visible” because the person riding the bicycle (aka the user of the larger object) cannot actually see the saddle?

One of the fundamental requirements for the registration of designs in Europe (and indeed across the world) is that the design claimed be visible to the consumer, even if is included within a larger object. This means that designs for parts which are not accessible to an observer is in principle not protectable as a design.

In 2011, Monz registered its design for a bike saddle with the German patent office (DPMA), with a single representation showing the underside of the saddle. In 2016, Büchel filed an application for a declaration of invalidity of the design, claiming among other things that the design which is a component part of a complex product such as a bicycle or a motorcycle, was not visible during normal use of that product. Indeed, how many of us can see the underside of our saddle when we are busy pedalling?

The DPMA rejected this argument, but upon appeal the Federal Patent Court of Germany agreed with it and declared the design invalid, as a component part which is only visible as a result of separating it from the complex product cannot be considered as satisfying the visibility requirement. Monz appeal that decision, and the case was brought to the Federal Court of Germany, who turned to the CJEU asking the following question:

• Is a component “visible” if it is objectively possible to recognise the design when the component is included in the larger object, or should visibility be assessed under certain conditions of use or from a certain observer perspective?
• If the answer to the previous answer is that certain conditions of use must be taken into account, how is the “normal use” of the larger object to be defined?

The CJEU held that indeed the visibility condition could not be met by a presentation of the design in question “in abstracto” and that it had to be visible during normal use of the larger object of which it is a component, even if that does not mean that the whole design must always be entirely visible during said normal use. The requirement of visibility must be assessed both from the perspective of the user of the larger object making a normal use of it (in the case of a bicycle, we assume this would include riding it), but also from the perspective of an external observer.

Trade mark litigation has reached the world of NFTs

Let us make a jump across the Atlantic Ocean because a peculiar case was decided last week by the District Court of New York, involving the famous luxury brand Hermès International, and the sale of Non-Fungible Tokens (NFTs) resembling one of their flagship products.

In January, 2022, Hermès International filed a civil suit against Mason Rothschild for trademark infringement of Hermes’ s famous BIRKIN trade mark by creating, marketing and a selling non-fungible token (NFTs) of Birkin purses named MetaBirkins. They had actually started this by creating a “Baby Birkin” NFT which depicted a 40-week old fetus gestating inside a transparent Birkin handbag. A collection of 100 NFT handbags bearing striking resemblance (in name and image) to the French fashion house’s purses were later created and sold online, for over 1.1 million USD. Hermès therefore sued alleging trade mark infringement, cybersquatting (Rotschild used the domain https://metabirkins.com) and unfair competition.

After a 6-day trial, the jury found that Mason Rotschild had indeed infringed on Hermès’ trade mark by commercializing NFTs resembling their purses, and was also guilty of cybersquatting for using the “metabirkin” domain name.

Much of the discussion during the trial surrounded the question of whether Rotschild’s use of the Birkin handbag was protected under the right to free speech, and the NFTs should be considered as pieces of art. It was however found that while there is protection afforded to artists (digital or not), the “free speech” defence did not allow Rotschild to create an impression that the NFTs were coming from Hermès themselves. The case is important as it is the first case which sets a big precedence in Web3.0 world of NFTs. On the legal jurisprudential side, the case delineates the boundaries between use of well-known trademarks by NFT creators for artistic explorations and expressions on one hand and use of trademarks for commercial pursuits.

This case is one of the earlier examples of IP-related disputes in which the offending act relates to the creation and commercialization of NFTs. While this case arose in the US, there is little doubt that similar disputes will not take long to arise in European courts as well. Perhaps the most striking elements about this case however is, despite having the now all-so-famous NFTs at their centre, how well the classic elements of trade mark law applied to these new forms of digital art called to change the world as we know it.