The metaverse and crypto-currencies pose a new challenge for trademark owners

In April, the International Trademark Association (INTA) published a pair of white papers on what are largely uncharted waters with regard to intellectual property: Trademarks in the metaverse. Kerstin Gründig-Schnelle, chairperson of the Trademark Office Practices Committee at INTA, gives her thoughts on how lawyers can best assist their clients in this new environment.

Posted mercredi, juin 14 2023
The metaverse and crypto-currencies pose a new challenge for trademark owners

Kerstin Gründig-Schnelle, chairperson of the Trademark Office Practices Committee at INTA, committed the publication of a pair of white papers on what are largely uncharted waters with regard to intellectual property; Trademarks in the metaverse.

LEADERS LEAGUE: What challenges does the metaverse pose for IP?

Kerstin Gründig-Schnelle: As trademark lawyers, we help our clients to navigate the metaverse challenges for their IP by reviewing their trademark portfolio and adapting it to the requirements of this new virtual environ­ment. Clients should consider both the future business activities of their company in the me­taverse and also the need for trademark pro­tection that enables them to proceed against trademark infringements in the metaverse.

 

Do you recommend filing new trademark applications for virtual goods?

It is indeed questionable whether a trade­mark, for example “Levis”, which is registered for clothing in class 25, covers also the use of the trademark for virtual clothing. EUIPO issued a statement regarding this question in June 2022 stating that virtual goods would be grouped in class 9 like digital content or digital images, according to EUIPO. They are distinct from so called NFTs (Non-Fungible Tokens) which certify the authenticity of a di­gital product.

Are owners of trademarks that include physical goods protection able to enforce their trademarks against ‘copycat’ virtual goods?

A trademark infringement requires likeliho­od of confusion resulting from identical or similar marks and identical or similar goods.

Courts and IPOs will therefore need to assess, whether, for example, virtual jeans which may be offered in the metaverse as fashion for ava­tars are “similar goods” in relation to jeans in the real world.

An important criterion for this assessment may be whether there are companies in the business world which offer both types of products. In particular in the field of consu­mer goods, there seems to be a development that owners of well-known trademarks offer their products under the same brand also in the metaverse. Should this trend continue, it would serve as an important argument to support the view that such goods are indeed similar.

However, we are still waiting to see precedents of EUIPO, national European Trademark Of­fices or courts. In view of this uncertainty, we strongly recommend our clients obtain addi­tional trademark protection for virtual goods in class 9. Also classes 35, 41 and 42 may be relevant when covering virtual services.

 

Will famous trademarks be easier to defend in such disputes than less well-known ones?

Indeed, famous trademarks enjoy an in­creased scope of protection in case of unfair exploitation of the distinctive character or the high reputation of the trademark both under the EU trademark regulations and national trademark laws in EU countries. Claims for trademark infringement may therefore be ea­sier to establish.

In the US, there was a recent legal action ini­tiated by Hermès International enforcing its famous Birkin handbag trademark against the artist Mason Rothschild, who had pro­duced an NFT collection called MetaBirkins that consisted of virtual recreations of Birkin handbags with fur in different colors and put them for sale on several metaverse platforms.

In February, the US District Court for the Sou­thern District of New York ruled that Hermès’ trademark rights were infringed and awarded Hermès $133,000 in damages.

 

In which countries should trademark pro­tection be sought?

In the offline world, trademark protection is always limited by territory, while the meta­verse has no such boundaries and may, in principle, be accessed from every country in the world. Trademark owners should obtain trademark protection not only in countries which are important sales markets but also in all countries with major production plants and, last but not least, in countries in which counterfeiters may be operating.

Interview with KERSTIN GRÜNDIG-SCHNELLE Chairperson of the Trademark Office Practices Committee, INTA & Partner (Germany), SCHALAST