The Metaverse – are you ready? | Lewis Roca
[co-author: Nikith Chavali]*
Metaverse is a term being used with increasing frequency across a wide range of industries, including video game systems, social media platforms, and even healthcare. The Metaverse is a virtual environment whose digital attributes persist even if the user is not online. It is similar to gaming systems like Farmville and Second Life in that a user interacts with a virtual environment. What makes the metaverse more complex is its integration with new technologies. Wearable technology such as the Oculus gives the Metaverse the ability to virtualize nearly every facet of the real world. The real-world similarities and high functionality can lead to legal issues, including trademark issues.
The metaverse allows users to interact with the virtual environment the same way they would with the real world. This means that virtual products in the metaverse can mimic real-world products. This creates both opportunities and risks for brand owners. On the one hand, it offers the opportunity to engage with consumers in new and original ways and opens up potential sources of licensing revenue. On the other hand, it creates a risk of counterfeiting by Metaverse entrepreneurs. For example, imagine that you are a shoe manufacturer known worldwide for its distinctive and high quality products. Your brand is instantly recognizable and you have diligently protected it. A virtual shoe store opens in the Metaverse selling virtual shoes to users. You discover that this virtual shoe store is selling your exact shoe, albeit virtually. If you are not already in the Metaverse and have not filed trademark applications covering virtual goods, the infringing party may argue that your existing trademark protection does not extend to the Metaverse. Additionally, the infringing party may argue that because you are not offering a competing virtual product in the Metaverse, consumer confusion is not likely. These arguments may prevail, particularly in countries that require registration for trademark protection.
To remedy such infringement, trademark owners should consider filing trademark applications covering products in the Metaverse. These applications would have the added benefit of supporting Metaverse licensing efforts and meeting likely requirements for infringing takedowns on Metaverse platforms. Major companies like Ralph Lauren, Walmart, Nike and McDonald’s have filed trademark applications covering Metaverse products and services such as NFTs, downloadable virtual goods, products for sale to virtual avatars, retail virtual goods , virtual food products and the provision of virtual products. Restaurants. As with most brands, being proactive can save time, money and headaches.
As with most brands, being proactive can save time, money and headaches.
* Summer Associate 2022. Nikith is not admitted to the bar and contributed to this Client Alert under the supervision of Ms. Van Kirk.