Original Penguin vs Pudgy Penguins: when two penguins share one brand 🐧

In the crypto industry, disputes over names, logos, and intellectual property happen regularly. But this time the conflict moved beyond the digital environment. The Pudgy Penguins project, which grew out of the NFT ecosystem, has found itself at the center of claims related to its clothing line. On the other side is Original Penguin, a fashion brand with a long history.

The dispute is not about the NFTs themselves and not about the fact that both sides use a penguin as a character. The claim concerns the commercial use of the brand in the clothing sector. The company behind Original Penguin states that Pudgy Penguins merchandise may infringe on its registered trademarks.

According to the plaintiff’s position, the Pudgy Penguins clothing line is entering a segment where Original Penguin already has a legally protected brand. If the court agrees with this argument, the issue will not be limited to similarities in names or symbols. In cases like this, another key factor is often considered: whether consumers could confuse the brands or assume that there is some form of partnership or joint product between them.

For Pudgy Penguins, this situation illustrates a typical challenge for Web3 projects that try to move beyond the digital environment. Within the crypto community a brand can become popular quickly thanks to its community and viral reach. But when it comes to physical products — clothing, accessories, or toys — traditional market rules and trademark law begin to apply.

NFT projects have been actively experimenting with these directions in recent years. Many are trying to turn digital characters into full-scale brands by launching clothing collections, licensing characters, and producing mass merchandise. However, the closer these initiatives move toward traditional industries, the more often they run into conflicts with companies that have already been operating in those segments for years.

In this context, the dispute between Original Penguin and Pudgy Penguins looks quite illustrative. It shows that for Web3 brands, popularity on the internet alone is not enough. If a project plans to scale into the offline market, it must consider traditional business tools: trademark registration, legal brand review, and a clear development strategy.

For now, the case has mainly drawn attention to the issue. But the very existence of such a conflict raises an important question for the entire industry: how far crypto projects can go when they attempt to turn a digital brand into a full consumer product.

In any case, this example highlights a simple point. Branding does not operate only within marketing — it also has clear legal boundaries. And when two brands begin to overlap within the same commercial category, the conflict quickly moves from a creative issue into a legal one.