Life, the Metaverse and Everything

November 10, 2022
IP Law


What is the Metaverse?

The Metaverse is a network of interconnected virtual spaces that allow users to interact with one another. In essence, it is engineered on the same basis as the internet; as a result, the same provisions for Copyright & IP Law apply. The difference between the two is that the Metaverse experience is immersive, 3D, real-time, and intended to simulate real life.As the technology improves, the intention is to create increasingly more realistic virtual experiences that blur the lines between the ‘real world' and the ‘virtual world’. A prime example of this is the first-ever fashion week held in the Metaverse, called the Decentraland Metaverse Fashion Week (MVFW). The MVFW had about 108,000 individual people in virtual attendance over the four-day event, which included hosting runway shows, after parties, and shopping events. The participants were able to view and purchase digital garments from 60 brands (including the likes of Dolce & Gabbana, Tommy Hilfiger, and DKNY).[/vc_column_text][/vc_column][/vc_row][vc_row row_mask_bg="" row_arrow="" css=".vc_custom_1663680123888{padding-top: 5px !important;}"][vc_column width="1/2"][vc_column_text]

Why Should I Care About the Metaverse?

With the explosion of cryptocurrencies and NFT’s, the Metaverse has become an important part of the ‘virtual economy’, which was estimated by Bloomberg to be worth approximately $478 billion in 2020.Companies are not just interested in capturing a share of the market, either. Because the Metaverse is decentralised, each company is able to curate a customer’s digital experience of their brand in an immersive and customisable way. This will allow companies to expand beyond physical geographies and do so with more control than they have previously had. For example, the four-day Metaverse Fashion Week enabled more than just online viewing – it enabled uniquely individual participation where each participant literally experienced a different perspective and range of immersive behavioural choices.[/vc_column_text][/vc_column][vc_column width="1/2" css=".vc_custom_1663679727249{padding-left: 50px !important;}"][vc_single_image image="8593" img_size="full" vc_none_hover_effect="" el_class="dots dots"][/vc_column][/vc_row][vc_row row_mask_bg="" row_arrow="" css=".vc_custom_1663680051650{padding-top: 5px !important;}"][vc_column][vc_column_text css=".vc_custom_1664190809099{padding-top: 10px !important;}"]Major brands are already moving to capitalise on this. Nike has created NIKELAND (on the Roblox online game platform) which has over 200 million active monthly users. Based on its explosive popularity and growth, the appeal and potential of the Metaverse is instantly understandable.In 2021, ‘real estate’ sales in the Metaverse topped $500 million according to CNBC. This is projected to double in 2022.Further, with the introduction of NFT’s, the ability to commercialise and commoditize products in the metaverse has been taken to another level.[/vc_column_text][/vc_column][/vc_row][vc_row row_mask_bg="" row_arrow="" css=".vc_custom_1663680142756{padding-top: 10px !important;}"][vc_column width="1/2" css=".vc_custom_1663680433853{padding-right: 50px !important;}"][vc_single_image image="8619" img_size="full" vc_none_hover_effect="" el_class="dots dots-left"][/vc_column][vc_column width="1/2" css=".vc_custom_1663680731253{margin-top: -15px !important;}"][vc_column_text]

Metaverse Legal Issues: Is it the Wild Wild West?

While it is tempting to believe that the Metaverse is another world, the laws of this world still apply. To avoid Metaverse legal issues, the most important forms of protection for your business in the Metaverse are found in trademark and copyright law.Each of these legal instruments protects different elements of your business. In the Metaverse (or anywhere virtual, for that matter), this can be a word, sign, symbol, or even a sound. Anything that can be graphically represented and is used to distinguish your goods and services from your competitors may be protected. Trademarks protect those elements of your brand that customers use to identify and distinguish your business from that of your competitors. In order to secure trademark protection, you must first apply for the registration of the mark and then follow the application process through to registration.[/vc_column_text][/vc_column][/vc_row][vc_row][vc_column][vc_column_text]

Trademarks Are Not Universal

An important consideration to bear in mind is that trademarks are not automatically universal. They are territorial, and trademark registration must be sought in each country in which you want to ensure the protection of your intellectual property. This may have ramifications for trademark infringement claims.Copyright, on the other hand, protects original works that are recorded in material form. The protection comes into existence automatically once all the requirements are met and no registration is necessary (or in most instances, even possible). The works recognised in the Copyright Act include artistic works (drawings, photographs, paintings, logos, product designs, etc), literary works, and computer programs. The protection gained is the exclusive right of the copyright owner to stop the use, copying or mutilation of the work. Copyright enjoys greater international protection thanks to South Africa’s participation in an international treaty. Again, with this in mind, copyright has an incredibly important role to play in protecting your rights in terms of Metaverse legal issues.[/vc_column_text][/vc_column][/vc_row][vc_row row_mask_bg="" row_arrow="" css=".vc_custom_1664190571109{padding-top: 10px !important;}"][vc_column width="1/2" css=".vc_custom_1663681108268{padding-right: 50px !important;}"][vc_column_text]

How do I Protect My Intellectual Property in the Metaverse?

As your business pivots into a digital environment, so your IP protection strategy needs to pivot as well. You may need to supplement your existing protection with additional trademark applications covering things like:

  • Downloadable virtual goods (class 09)
  • Virtual retail stores and marketplaces (class 35)
  • Non-downloadable virtual goods and NFTs (class 41)

Many companies have already started filing trademark applications to support their move into the Metaverse. For example, Nike has filed the following trademark applications:

  • NIKELAND in class 09 (downloadable virtual goods), class 25 (footwear and clothing), class 35 (providing an interactive website and computer application software for virtual reality game services), class 41 (non-downloadable virtual footwear, clothing, bags, etc) and class 42 (non-downloadable computer software); and

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  • NIKE and the NIKE & SWOOSH LOGO in class 09 (downloadable virtual goods), class 35 (providing an interactive website and computer application software for virtual reality game services), and class 41 (non-downloadable virtual footwear, clothing, bags, etc).

Trademark filings are clearly important and are a first line of defence against infringement. A trademark filing should also secure your right of use of your brand within the Metaverse.As mentioned above, copyright is also critically important in the context of the Metaverse. This protection is limited to actual copying of your work - but has a massive advantage over other forms of IP in that it is not geographically limited and has no cost implications.

Common Copyright Misconceptions

What is important is to ensure that you own the copyright in question. For example, there is a common misconception that if you pay for something, you then own it. That is not how copyright works. The first owner of copyright is determined by the Act, and the only way to transfer ownership is by way of written agreement. This means that if you outsource the creation of any work, the creative provider will (in most cases) automatically be the first owner of the copyright in that work. It is critical that you have a written agreement with the creative provider that provides for the transfer of the copyright in the work to you.

What Steps Should I Take Next to Protect My IP?

Whether you’re venturing into the Metaverse or not, it’s imperative to ensure that your brand and its associated intellectual property is secured against misuse or theft. A pragmatic, proactive approach is necessary – and that’s why it is important to consult with your IP attorney and form a strategy that makes legal and financial sense.At Witz Inc., our expert IP team are here to help. Contact us today.[/vc_column_text][/vc_column][/vc_row]