The digital revolution introduces the Metaverse, a composite of multiple virtual realities with significant implications for intellectual property (IP) rights. This article sheds light on the complicated relationship between IP and the Metaverse and delves into methods through which IP owners can successfully traverse this new digital terrain.
IP in the Metaverse: Identifying Protectable Assets
When discussing IP and the Metaverse, it’s important to first identify which assets or objects within the Metaverse can potentially result in IP rights.
Hardware: the equipment that allows users to access the Metaverse may be protected by various IP rights. For instance, the technology behind the VR helmets may be protected by patents. Similarly, the computer programs or codes facilitating the generation of virtual worlds and enabling user interaction may be copyright-protected or, in some jurisdictions, patent-protected. But, these protections are standard and not unique to the Metaverse.
Digital Creations: the discussion becomes much more fascinating when we examine creations birthed within the Metaverse. This presents two distinct scenarios:
1. The Metaverse’s graphical interfaces may be copyright-protected if it can be proved original. In videogames, for instance, the settings, characters, and all included assets (like cars, weapons, etc.) can be eligible for copyright protection. However, this eligibility may ultimately come under question if these assets were developed through or with artificial intelligence.
2. In what is termed as open metaverses, users may have the autonomy to create new features or assets. In these situations, the developer behind the Metaverse creates a foundation and incorporates software that empowers users to produce new elements (user generated content: UGC). The question of copyright ownership over UGC is generally governed by the platform’s terms and conditions (T&C). Often, the platform owner might demand a full license, if not total control over such assets.
Real-World IP in Virtual Settings: The replication of real-world, IP-protected assets like artworks and trademarks in the Metaverse raises important legal concerns. For example, using a trademarked brand name or logo in a virtual store without authorised consent could potentially invite trademark infringement lawsuits.
Protecting and Enforcing IP Rights in the Metaverse
Given the Metaverse’s digital nature, there are new challenges for traditional IP protective measures. Enforcement of IP rights in the Metaverse proves complex and largely remains untested in legal courts.
Trademark Protection and Enforcement: Trademark protection within the Metaverse hinges on the similarity of digital goods and services to their real-world analogues. For instance, a virtual shop selling real shoes that will be delivered may result in trademark infringement. This is the solution reached by a US court in the MetaBirkin case where Hermes won a trademark infringement claim against Mason Rotshild for having sold its MetaBirkin NFTs.
Now, what if the digital shop only sells digital shoes, for example NFTs? Would it be considered as an infringement of a trademark registered only for physical shoes? This question remains unsettled due to lack of case law.
Under this ambiguity, many brand owners have sought to adapt their rights in line with the Metaverse’s digitised nature. We are witnessing a trend towards new trademark applications that include “virtual” in their class description. For extension of protection into the Metaverse, companies are tapping into classes 9, 35, and 41 of goods and services.
Copyright enforcement poses another query: does the unauthorised reproduction of copyrighted work in the Metaverse infringe copyright laws? It would not be farfetched to consider that publicly accessible representation of a work in the Metaverse can be seen as public communication. However, the answer will also depend on the specifics of the case and the applicable law.
Consider French law, for instance, which is generally more protective of copyright than US law, notably because it does not have a “fair use” doctrine. No case has been judged in France at this point in relation to the Metaverse but the French Supreme Court, in a 2014 decision, ruled that the reproduction of a car in a videogame could constitute a copyright infringement (although the infringement claim was dismissed in this case, see French Supreme Court. 8 April 2014, Ferrari/ Take Two).
In comparison, US law’s “fair use” doctrine might hamper copyright enforcement. A case to note is AM General LLC v. Activision Blizzard, where AM General, the Humvee truck creator, sued Activision Blizzard for trademark infringement for including the truck in their Call of Duty video game. The court dismissed the suit on summary judgment under the First Amendment, ruling that (1) “Defendants’ uses of Humvees in Call of Duty games have artistic relevance,” and that (2) “[f]eaturing actual vehicles used by military operations around the world in video games about simulated modern warfare surely evokes a sense of realism and lifelikeness.”
Further challenges remain: Enforcing IP rights in the Metaverse is complex, with issues ranging from finding anonymous infringers to determining applicable jurisdiction and laws.
Conclusion
As the Metaverse continues to evolve, so too must our understanding and frameworks for managing IP within it. Stakeholders, including creators, users, and legal professionals, must navigate these uncharted waters with a keen eye on both protecting IP rights and fostering innovation.
