Intellectual Property Risks in the Metaverse: Protection, Jurisdiction, and Enforcement


“As we look to a world that could be shared between physical and virtual environments, brand owners should consider protecting virtual goods and services as well as those in the physical world.”

The Metaverse is commonly referred to as “a collective virtual shared space, created by the convergence of a virtually enhanced physical reality and a physically persistent virtual space, including the sum of all virtual worlds, augmented reality, and the Internet “. The metaverse may optionally provide a three-dimensional or virtual world for users to shop, play games, travel, learn, socialize, work, compete, or experience life in a virtual environment . Users may possibly visit the metaverse for an activity or even choose to live a large part of their life in this virtual world.

A user’s experience in the Metaverse will mimic the physical world, although not all objects in the Metaverse represent an object in the physical world. A virtual shopping experience in the metaverse can look like a real-life version of a mall, perhaps personalized for the user. A virtual workspace, such as an office or conference room, can facilitate remote work and continue to improve virtual meetings. The game should continue to evolve by becoming more realistic and more adaptive in real time.

A user’s appearance in these environments, whether in a game, at work, or in some other social interaction, could be described as a digital avatar that represents the user in a realistic or even fanciful guise. There are limitless possibilities for configuring a user’s appearance and abilities, including what an avatar wears, how they speak, whether they can fly, where they reside in a virtual environment, how they earn or spend money. money, and more.

The digital world may be approaching realism, but it is still an extension of the physical world. Real-world IP issues will also extend to the Metaverse, though there are opportunities that arise in the Metaverse as well.

Non-Fungible Tokens (NFTs) are an enhancement to blockchain technology and provide functionality to track and limit the use of proprietary rights. NFTs are minted on the blockchain and can provide a more immutable solution for registering unique ownership rights, establishing authenticity, and distributing rights. Upon implementation, brand, music or other media related to an NFT may only be displayed after confirmation of ownership of that NFT. A coin changer can configure this NFT to provide such functionality to use certain media without actually passing ownership of the underlying intellectual property rights. An infrastructure using NFTs can provide new capabilities to ensure proper use of intellectual property rights.

Web3 (or Web 3.0) is an emerging iteration of the internet in which the tech industry is trying to merge the benefits of metaverse and NFT/blockchain technologies. While Web 1.0 refers to an era of static web pages and centralized data servers, Web 2.0 offers decentralized data (eg cloud hosting) and content generation (eg social media , blogs, wikis). Web 2.0 still focuses on large technology companies that host Web 2.0 services. Web3 promotes decentralization by moving data from hosted clouds to decentralized blockchains and other decentralized storage locations. User online experiences are likely to evolve to remove the need for websites or storefront web applications to access data, as decentralized storage removes the tight ties between the host service and the data. Instead, the data is accessed through a variety of applications, such as the Metaverse. In a simplified metaverse mall example, the user’s metaverse software could access decentralized data, such as NFTs, representing the user’s avatar, the stores in the mall, the products available at each store, and the user wallet.

1. Protect brands

Brand owners will want to interact with new and existing customers in the metaverse. Trademark owners will want to protect the mark with trademark protection and control the use of the mark as it is used in the virtual world. As we look to a world that could be shared between physical and virtual environments, brand owners should consider protecting virtual goods and services as well as those in the physical world. Brand owners will want to protect the use of their brand and products from use on avatars (such as a logo appearing on an avatar’s shirt) or as an object in a virtual world (such as a passenger car appearing in a video game).

Two cases currently address the issue of trademark protection for virtual goods represented by NFTs. The first is the MetaBirkins case, in which Hermes brought a trademark infringement suit against an individual who minted NFTs containing virtual representations of Hermes Birkin bags. In a similar case, Nike sued StockX for selling NFTs depicting Nike shoes. There’s more to follow on these two cases, but so far the courts have adhered to conventional notions of trademark protection for NFTs and the metaverse. Nonetheless, brands file trademark applications for metaverse or NFT representations of their real-world goods or services.

2. Protect inventions

Innovators have put considerable effort into building the metaverse, which includes new features and builds on previous foundations of virtual reality and augmented reality. Innovations include new methods of purchasing physical or virtual products, cryptocurrencies for use in the metaverse, linking physical and virtual elements to connect the physical and virtual worlds, as well as others related to infrastructure involving artificial intelligence, blockchain, communication protocols and cloud computing. Various aspects may be patentable and such protection should be sought quickly as the rate of innovation has rapidly accelerated for metaverse technologies.

3. Copyright Protection

Copyright owners will want to monitor the metaverse for their copyrighted expressions. As any physical item can be represented in the virtual world, it is possible that various works of art, such as paintings or sculptures, can appear in a virtual environment in the metaverse. A virtual environment may also feature movie scenes or play songs, perhaps even display a character from a book or movie as an interactive individual. Some copyrights are used to protect digital items, such as digital artwork, which may be even easier to view in a virtual environment. Software may also be susceptible to being stolen from the Metaverse as it may be appropriate to provide functionality in the Metaverse. So, whether creating a new expression for the metaverse or protecting ones for the physical world, copyright owners have a new frontier to watch.

4. Competence and Application

The multijurisdictional nature of the Internet presents challenges in determining where to enforce intellectual property rights that are specific to a particular domain. An entity can also interact in the metaverse with more anonymity than in the physical world, which raises the difficulty of identifying offenders. Although the metaverse can add to the complexity of these problems with an even more integrated virtual world, the application solutions can be similar to other Internet-based approaches.

Image Source: Depot Photos
Author: wacomka
Image ID: 236672872


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