Many brands have taken steps to proactively protect their intellectual property rights for use in connection with metaverse-related goods and services. This may include filing new trademark registrations or purchasing blockchain domains. But enforcing these rights poses a major challenge. In this alert, we discuss ways to identify and address trademark and copyright infringement in the Metaverse.
What is the Metaverse?
The metaverse is a persistent digital environment that will allow individuals to move seamlessly between their physical and virtual worlds. While much of it remains ambitious, some key trends are already emerging:
- It will feature immersive virtual worlds built on blockchain technology that will house vibrant digital economies;
- Governance will be decentralized and autonomous;
- It will leverage next-generation consumer electronics with augmented and mixed reality capabilities that will serve as a gateway or bridge between physical and virtual experiences;
- It will feature advanced avatars; and
- Its full potential will likely require interoperability between virtual environments.
Challenges for the application of intellectual property
The decentralized nature of the metaverse poses perhaps the biggest challenge for brands and intellectual property owners. To understand why it is useful to look at the legal framework and protocols that have emerged to prevent and remedy infringements on the “traditional” Internet. Today, most websites are hosted on servers run by specialized web service providers. Under the Digital Millennium Copyright Act and Section 230 of the Communications Decency Act, these hosting providers are generally not responsible for infringing content on their servers as long as they act promptly to remove it after receiving proper notice. So when a brand discovers infringing content on a site, they can contact the host, demand that the content be disabled or removed, and the host can simply remove the infringing content.
Likewise, social media networks have developed strong policies and processes to control intellectual property infringement. Assuming a brand can convince a network to take action, it is relatively easy for the network to suspend or disable infringing content.
In contrast, blockchain-based, or “Web3” platforms do not reside on a single server. Instead, content is distributed and replicated to an essentially infinite number of servers via a peer-to-peer network. As such, there is no single point of authority, such as a hosting provider or ICANN, that can “disable” infringing content. Additionally, once content is on the blockchain, it cannot be deleted; it is there forever.
So what should a brand do?
- be there: Unfortunately, there is no easy way to monitor virtual worlds, such as Decentraland and The Sandbox, for infringing content. Brand search and monitoring services generally do not have the ability to see or remove content from web3 platforms, and major search engines are unlikely to capture blockchain code in their web searches. common right. Until specialized tools are developed, one of the best ways to monitor metaverse breach is to be there: establish a routine presence in popular metaverse worlds like Decentraland or The Sandbox; monitor major discussion forums; and monitor transactions on major public blockchains.
- Target the secondary market: While Web3 platforms are decentralized and autonomous, many metaverse service providers are traditional entities. NFT marketplaces like OpenSea, for example, monitor content that appears on their marketplaces for resale and have adopted policies and procedures to remove infringing content. While removing infringing content from secondary marketplaces can help eliminate or reduce the incentive for infringers to traffic infringing content, it is important to note that these marketplaces have no control over the underlying assets. So even if removed from a marketplace, infringing content will still remain on the blockchain.
- Play well: One of the few safe ways to control illegal content is to acquire it. Most things on Web3 are available for purchase at fair prices, but such a strategy can quickly become costly while inciting further infringement.
- be proactiveAs noted above, many brands have already taken steps to file metaverse-related trademark applications and purchase blockchain domains. While not a panacea, they are important steps for brands.
As the first major law firm to purchase land in the Metaverse, ArentFox Schiff has a deep group of attorneys who understand the Metaverse and the unique challenges it poses for brand owners.