Metaverse is the new oil. Intellectual Property rights being the product of human curiosity and intellect, their protection within new ‘virtual worlds’ is of utmost importance. The paper deliberates upon the issues of infringement of trademarks, patents, and copyrights, while discussing various case laws involving IPR within virtual reality. Furthermore, the legal-regulatory frameworks governing the rights in the metaverse are currently less than optimal but being used resourcefully. An effort is made to point out that existing regulations can be made with minor legal amendments and new cutting-edge monitoring mechanisms, to ensure that a ‘living’ regime of intellectual property is established that efficiently moves alongside the rising pace of technology and science.
In the year 1962, Morton Heilig patented the earliest version of the pre-metaverse virtual world, called the Sensorama Machine which created a simulation of riding a motorbike where the user could actually experience the vibrations of the bike, sounds, and scents associated with the ride, immersed in a 3D video setting. Metaverse can be defined as a virtual world, connected by multiple 3D worlds where multiple users can interact with each other using immersive state-of-the-art technologies, creating an experience of the real world itself. The concept itself can be traced back to the Advaita Vedanta philosophy of Shankaracharya, wherein he argues that the reality we assume is actually a dream of the Brahma/Ultimate consciousness, which we are all unaware of on account of being in the dream ourselves, similar to Metaverse. Like Metaverse, this reality, as Shankaracharya argues, is only ‘relatively real’, that is while it is created by a third party and thus can be dismantled like a computer program, the mundane aspects within this reality are definitely real, thus making the rights and duties of people within such reality a matter of deep concern.
Rights, Intellectual Property & Metaverse:
The Jurisprudence on the legality of actions committed by virtual characters, although controlled by real persons within a metaverse, is in its infancy and yet to develop completely. The fact that the metaverse feels ‘real’, is the basis of demand to apply real-world laws within it as well. However, it would be difficult to ascertain as to which rights of people can be protected within Metaverse, for example, right against assault will be difficult to protect without ‘bodily harm’, while rights against sexual harassment will apply as they do not need physical touch to come into play. In fact, in 2021, a woman was sexually assaulted in the Metaverse of ‘Horizon Worlds’ leading the platform to launch an inquiry into the matter. Similarly, Intellectual Property rights (IPR) are essentially creations of the human intellect, their applicability will naturally transcend the real-virtual border, thereby creating a need to establish mechanisms for their protection. Infringement of IPR which includes protection of trademarks, patents, copyrights, etc. within Metaverse is a hotly contested topic in today’s era as the legal status of Metaverse itself is unclear.
Trademarks in Metaverse:
Trademark is a visual symbol that distinguishes trademarked goods & services from others. If such a symbol which is protected under laws in the real world, its status in the metaverse should not be too different. Metaverse is practically a boon for Trademark holder companies as it provides fertile ground for the promotion and marketing of trademarks in a cost-effective way. In Metaverse, the allegations of trademark infringement have already been seen in multiple cases. In the famous case of E.S.S Entertainment 2000, Inc. v. Rockstar Videos, Inc, et al., 2008, the court decided that virtual representation of the real-life strip club trademark logo within the game of GTA, which is one of the earliest metaverses, will not amount to trademark infringement as it is creative freedom protected under First Amendment of U.S Constitution. However, in other cases, the unauthorized use of trademarks in Metaverse is strongly disputed. The major contention being the nature of unauthorized use of trademark, that is, only if the use is de minimis or not capable of causing amongst the public or not for extracting commercial gains, the exemption from an infringement would be considered. In the case of Tata Sons Limited vs. Greenpeace International, the court held that the unauthorized use of the trademark of the petitioner, within a game created by the defendant, to raise environmental cause & criticize the defendant was merely a parody & would not amount to infringement. Such cases leave one to ponder how would a trademark be protected if it was created by an avatar within the metaverse itself!
Patents within Metaverse:
The filing of Patents related to the metaverse has been rising over the past decade. Patents within Metaverse have to be dealt with under three verticals: Firstly, Patents of Metaverse technology itself, which itself can be divided into hardware & software technologies needed for building a customized & unique Metaverse. Since it is not possible to patent Metaverse as a whole, different patent applications are being filed for Augmented Reality & Virtual reality technologies, software applications, etc. Secondly, already existing patented technology or machines if used within Metaverse in its virtual form, which is termed as ‘Virtualization of patents’, may lead to their infringement. The third vertical is quite interesting as it talks about the patents created by avatars within Metaverse. Indian Entrepreneur Bhargav Sri Prakash was recently awarded a patent by the US for the first ‘Digital Vaccine’ which was invented & tested by him in a metaverse game! This case also hints toward unimaginable implications of the Metaverse on Medical Patents & healthcare as a whole.
Copyrights in Metaverse:
The most common copyrights relating to Metaverse are the software applications aiding to create the Metaverse. Since such virtual worlds are a kind of ‘combinatorial inventions’, which include various musical, artistic, literary, sound, and dramatic works, copyright claims are also made separately as such. Since an infinite number of creations are possible within Metaverse, copyright claims are quite interesting. In the case of Amarreto Ranch Breedables, LLC Vs Ozimals, Inc, where Ozimal developed ‘breedable animals’ within the ‘Second Life’ Metaverse, the plaintiff claimed that the defendants by developing ‘virtual bunnies’ had infringed upon their copyright of a virtual horse’ created within the Metaverse! Non-Fungible Tokens (NFTs) are yet an interesting way to protect copyrights as well as an avenue for infringement because NFTs are essentially tokens that although can be virtually traded, their underlying asset remains as it is. Thus, an artwork NFT can easily be infringed or replicated without the permission of the owner. However, NFT license agreements can help creators to safeguard their copyrights in form of NFTs.
Legal Framework & Regulations:
IPR within Metaverse current lies in a legal grey area. The legal framework for virtual space is either minimal or non-existent. It is no surprise that IPR applications have increased manifold. Given below is a data of applications regarding Metaverse filed with USPTO:
Since specific provisions for Metaverse IPR applications do not exist, these applications are largely filed in the United States under Technology Centre No. 2100 (Computer Application and Software) which includes AI and Simulation, Graphical User Interface, Memory access, and Control, etc. The USPTO has rolled out an ID Manual that lays down multiple phrases for Metaverse virtual patents, for example, ‘downloadable virtual goods for use in a virtual world’ would fall under Class 9 of the NICE Classification. Thus, applications have been filed in the US, India, and other countries by giants like Walmart, and Vogue under Classes 9, 35, 41, 43, etc, under the direction of the above-mentioned ID Manual. Nevertheless, legal and technical mechanisms to prevent infringement and keep track of IPR within the metaverse are difficult to establish but will have to emerge alongside.
According to a recent report by J.P.Morgan, 54 billion dollars are being spent on virtual goods, which raises immense possibilities of IPR applications and infringement cases as well. In the world of unlimited imagination, the protection of intellectual property rights is an arduous task. It will essentially depend on one hand, upon the proactiveness of governments to incorporate relevant provisions into their IPR laws including amending the classes of trademarks along with amending the NICE Agreement, 1957 by WIPO to include specific provisions related to the topic, rather than relying on mere guidelines of a single nation. On the other hand, effective oversight mechanisms including but not limited to the virtual investigator of IPR infringement, future-proofing existing intellectual property rights, a virtual database of NFTs, etc must be established. As we move into the era of Web 3.0 & Globalization 4.0, IPR laws have to be upgraded as well for as Mark Twain pointed out in his witty way, “A country without a patent office and good patent laws was just a crab and couldn’t travel anyway but sideways or backward!”
 Penultimate Year Law Student at GLC, Mumbai.
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