The clothing brand Original Penguin has filed a trademark infringement lawsuit against NFT token project Pudgy Penguins, claiming the NFT company’s merchandise violates its decades-old intellectual property rights.
PEI Licensing, the firm behind Original Penguin, filed the lawsuit in a Florida federal court on Wednesday, alleging trademark infringement, dilution, and unfair competition related to Pudgy Penguins’ apparel line.
The lawsuit focuses on Pudgy Penguins’ clothing merchandise, which PEI claims uses a “family of penguin trademarks that are confusingly similar” to its own established brand. PEI has operated the Original Penguin clothing line for decades, dating back to the 1950s.
“This action results from Defendant’s unauthorized use and attempted registration of various PENGUIN word and design trademarks in connection with apparel and related goods and services that are confusingly similar to PEI’s federally registered and famous PENGUIN and penguin design trademarks,” PEI stated in its complaint.
According to the lawsuit, PEI has used the “PENGUIN word mark at least as early as 1967” and first used a “penguin design” on apparel as early as 1956. The company argues its penguin branding has achieved “famous” trademark status over nearly seven decades of use.
The legal dispute began well before this week’s court filing. PEI Licensing said it sent a cease and desist letter to Pudgy Penguins in October 2023, claiming the NFT project’s “products infringe and dilute PEI’s famous PENGUIN Marks.”
That letter also demanded that Pudgy Penguins abandon its applications with the US Patent and Trademark Office “to register various PENGUIN marks,” according to the complaint. The clothing company claims Pudgy Penguins has “misappropriated valuable property rights of PEI,” which is “likely to cause confusion or mistake, or to deceive members of the consuming public.”
PEI is requesting extensive remedies from the court. The company asked the court to order the USPTO to reject Pudgy Penguins’ trademark applications and stop the NFT company from allegedly infringing on its trademark.
Additionally, PEI requested that Pudgy Penguins be ordered to destroy any products found “likely to be confused” with PEI’s trademarks and be awarded all profits from the sales of such products.
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Jennifer McGlone, Pudgy Penguins’ legal chief, told Cointelegraph that the company “was surprised by the action, particularly as both parties had been engaged in productive discussions to resolve this matter privately.”
McGlone said Pudgy Penguins has advanced applications with the USPTO and is “confident that PEI’s claims lack merit. The trademarks in question are visually distinct and serve entirely different audiences and markets.”
“We have the utmost confidence that we will prevail as Pudgy Penguins has already secured multiple trademark application approvals from the USPTO covering the Pudgy Penguins brand and related marks,” she added.
The Pudgy Penguins project responded to the lawsuit on its official X account by posting a meme implying that its brand bears no similarities with Original Penguin. The post featured side-by-side comparisons of the two brands’ penguin designs.
The case represents one of the first major trademark disputes between an established fashion brand and an NFT project that has moved into the apparel space. The outcome could set a precedent for how intellectual property rights are interpreted when Web3 projects expand into traditional consumer goods markets.
Pudgy Penguins launched in 2021 and has become one of the most successful NFT collections, with its floor price consistently ranking among the top projects. The project’s expansion into physical toys and merchandise has been a key part of its strategy to build a recognizable brand beyond the crypto community.
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