By Christopher Salotto
IP in the Metaverse
The modern era is characterized as a period in human history involving a rapid shift from the physical world to a world where computer technology and virtual reality are supreme. This shift brings about a world in which individuals constantly crave virtual interaction. As a result, the concept of the metaverse was created. This refers to the shift of real-world experiences to an immersive, virtual experience where an individual can engage in numerous activities imitating those of real life. This shift raises many questions regarding intellectual property (“IP”) laws and how they will apply and protect IP in this new world.
The Metaverse
Like humans, the internet has undergone a natural evolution leading to the concept of the metaverse. This evolution can be broken down into three web eras. Web 1.0 involved static webpages, focused on users consuming content. Web 2.0 is the current dominant landscape of the internet in which users interact with, create, and share content. Web 3.0 is the next phase in the internet’s evolution that involves decentralization, which gives users greater control over their internet experience.[1]
The metaverse has its foundation in Web 3.0 technologies. It is a decentralized and immersive, online universe that utilizes virtual and augmented reality to create various digital worlds. Within these worlds, individuals across the globe may anonymously create avatars to interact with others. Individuals can use their avatar to shop, socialize, work, and even gamble using cryptocurrency and NFT technology. As the metaverse and Web 3.0 continue to evolve, the digital world seems to be meshing with and taking over reality.[2]
Intellectual Property Within The Metaverse
Enforcing IP rights within the metaverse is a concerning issue. Specifically, IP owners should be concerned with how IP infringements will be identified. The metaverse is an unlimited virtual space, across numerous servers, where individuals can remain anonymous while engaging in any activity. As a result, it is difficult to determine an infringer’s identity and location throughout the world. Additionally, even if infringements can be identified, it will be difficult to determine which court will have jurisdiction over such infringement cases.[3]
The scope of IP protections extending to Web 3.0 innovations is currently unclear. Existing laws and regulations surrounding IP may not adequately protect IP owners in the metaverse. In fact, NFT markets have already raised novel IP issues and the metaverse poses an even greater possibility for such disputes.[4]
Current Metaverse & Intellectual Property Issues
One IP issue arising from the metaverse involves trademark protection. Specifically, companies should look to protect the use of their trademarks from being used as NFT representations and on various objects and products in the metaverse. Recent cases regarding this issue have applied traditional trademark protections.[5] Regardless, companies should still file trademark applications for virtual representations in the metaverse and for NFTs.
A second issue that may arise involves patent protection. In creating the metaverse, new technology and improvements on current technology in the physical world have been and will continue to be developed. This is likely to raise questions regarding the patentability of these innovations. Specifically, there may be adverse consequences for determining what constitutes prior art, patentable subject matter, and obviousness.[6] Regardless, companies should apply for patents as soon as practical to prepare for the exponential rate of innovation occurring in the metaverse.
A third issue that may arise involves copyright protections. With the limitless scope of the metaverse, IP owners will have a difficult time monitoring every digital world for copyright infringements. The virtual environment complicates this issue even more because of how easy it is to copy and present works of authorship in virtual form. Such works are susceptible to copyright infringement in the metaverse ranging from paintings and sculptures to movie scenes and book characters.[7] Copyright owners should continue to monitor the metaverse and NFT graphics to discover possible infringements as early as possible.
Conclusion
The increasing popularity and emergence of Web 3.0 innovations, and the metaverse in general, provides endless opportunities for IP owners to benefit from. However, these opportunities do not come without the risk of infringements and unclear legal applications of traditional IP laws and regulations. As the virtual world continues to develop, the number of IP disputes will grow and new ways of applying existing laws and regulations will emerge. If IP owners, law firms, and lawmakers stay vigilant regarding these issues, then the metaverse and Web 3.0 technology can continue to evolve and be successfully adopted and implemented going forward.
[1] Katherine Imp, Mark F. Radcliffe, Michael Fluhr, & Tom K. Ara, Exploring the metaverse: What laws will apply?,DLA Piper, https://www.dlapiper.com/en/us/insights/publications/2022/06/exploring-the-metaverse-ipt-news-june-2022/ [2] Web 3.0 Explained, Plus the History of Web 1.0 and 2.0, Investopedia, https://www.investopedia.com/web-20-web-30-5208698 [3] Lawrence Yeung & Ludwig Ng, Intellectual property issues in Metaverse and non-fungible token (NFT), ONC Lawyers, https://www.onc.hk/en_US/publication/intellectual-property-issues-in-metaverse-and-non-fungible-token-nft [4] Katherine Imp, Mark F. Radcliffe, Michael Fluhr, & Tom K. Ara, Exploring the metaverse: What laws will apply?,DLA Piper,