Navigate Trademark Protection in the Metaverse

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The metaverse is the latest hot topic of conversation in the business world. Catapulted to the forefront of tech industry thinking in recent years by the cryptocurrency and NFT boom and, more recently, garnering widespread attention following Facebook’s rebranding to Meta, many predict that it will be bigger than the Internet is today. With the impact of COVID-19 pushing more people online and virtual interactions increasing, from video conferencing to immersive digital experiences created by museums and art galleries, the metaverse appears to be more than just a fad.

but what is it exactly? Coined by writer Neal Stephenson, in his 1992 novel “Snow Crash” as “a global digital world that exists alongside the real world”, there is no single agreed definition of the metaverse. It usually refers to an immersive virtual space, where people can interact with virtual objects in real life. For technology companies, the potential exists for a new digital economy, where users can create, buy and sell goods.

Besides its obvious benefits for the gaming industry, there is huge potential across all industries – Ikea’s ‘Place’ app lets customers view furniture in their own home or office, Nike has recently partnered with Roblox to launch its Nikeland metaverse and Johnson & Johnson has opened its first training room for doctors, offering simulators for learning surgical acts.

Various virtual world platforms exist in the metaverse, of which Roblox, Decentraland, and The Sandbox are the most popular. The opportunities for brand owners to reach a wider audience and increase consumer engagement with the brand are vast; last year Roblox collaborated with Gucci to create a two-week art installation, where users could view digital Gucci clothing, and earlier this year HSBC invested in land in The Sandbox, to engage with global financial services and sports communities. But entering the metaverse is not without risk. Unauthorized use by third parties of potentially confusingly similar marks is likely to confuse consumers and trademark holders will need to consider new monitoring strategies, so that prompt action can be taken to prevent dilution. of a trademark when infringements are detected.

With more and more businesses entering the metaverse, trademark offices have seen an increase in trademark applications covering virtual classes of goods and services and, as expected, bad faith applications are booming. In November last year, two trademark applications were filed by unrelated third parties relating to the Gucci and Prada logos covering a range of metaverse-related products and services. Both companies take issue with unregistered rights-based apps, but while Gucci and Prada might well argue that unauthorized use in the metaverse tarnishes their unique brands and reputations, other lesser-known brands will have a harder time. As is almost always the case, registered trademarks are easier to enforce than unregistered rights.

In conclusion, the emergence of the metaverse and the increase in intellectual property filings indicate that conducting business in the virtual world is an increasingly high priority for brands and necessary to remain relevant and competitive. Until we know the extent to which real-world goods and services offer protection against those same goods and services in the virtual world, companies intending to actively target the metaverse would be wise to consider submitting applications for key brands in relation to virtual goods and services. In any event, all rights holders will need to consider how to monitor this emerging and unregulated space for unauthorized use and subscribing to a trademark monitoring service will likely be essential.

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