Case law: How protected is a brand in the metaverse?

In a rapidly digitising world, protecting brands is becoming increasingly complex and essential, even alongside the rise of the metaverse. With the evolution of technologies such as virtual reality (VR), the metaverse is becoming a new arena in which companies need to establish and protect their brand identity. What exactly is the metaverse and how can a brand be protected in it?

Metaverse

A metaverse can basically be any 3D virtual space powered by technologies - including VR, augmented reality (AR), artificial intelligence (AI) and blockchain - that allow people to interact with each other.

In the metaverse, users can create an avatar to represent themselves and then participate in various activities, such as gaming, shopping and working. Mark Zuckerberg's hope for his own metaverse at Meta is that companies will actively use it to hold meetings, for example, or that people will start to see it as a "second life" parallel to their lives in the analogue world.

Marketing in the metaverse

Metaverse marketing is thus also becoming a buzzword among consumer brands. Large multinationals such as Nike and McDonald's are doing much to harness the marketing potential of the metaverse. For example, McDonald's Hong Kong recently created 'McNuggets Land' on a metaverse platform, where the company sold McNuggets and gave virtual 'historical nugget tours'.

Products that exist in the metaverse are just the virtual representation of the real product. They are represented by means of a non-fungible token (NFT). An NFT is a digital asset that represents real objects from the real world. It is a unique digital identifier captured on a blockchain and used to certify ownership and authenticity. So McDonald's, for example, can sell nuggets to consumers through these NFTs.

For clothing brands, this is also becoming increasingly relevant. For people that have their own avatar, they naturally want to dress it. Many would probably be interested in the new Nike trainer in NFT form, for example.

Trademarks in the metaverse

To protect a trademark in the European Union (EU), it is necessary to register the trademark with the European Union Intellectual Property Office (EUIPO). This registration gives exclusive rights to use the trademark within the EU. However, registering a trademark in the physical world does not yet guarantee protection in the digital world.

A number of large companies have already filed new trademark applications for this reason, to adapt their trademark rights to this new digital environment. To protect their assets or enforce their rights against very similar or identical representations of their products in the metaverse, they cannot simply rely on their existing registered trademarks, if those trademarks are not registered in classes covering computer software.

To establish a trademark identity in the metaverse, companies can apply for registration for their trademarks in classes relevant to virtual goods and services. Classes such as class 9 (for software) and class 41 (for entertainment services) are often used to protect trademarks in the metaverse. This has to be done with a new trademark registration, which therefore does not guarantee that your trademark will also be registered in those classes. Subsequently, companies can also grant licences to selected partners to use the mark in the metaverse. Companies can register trademarks in classes 9 and 41 within the EU at the EUIPO. That way, at least their brand is protected.

Conclusion

As the metaverse unfolds as a new digital landscape, companies are faced with the challenge of maintaining and protecting their brand identity. Who knows, in the foreseeable future, it may be only natural to operate in the metaverse with NFT Louis Vuitton bags and undrinkable NFT Starbucks coffee. By registering brands in relevant classes, companies can prepare for the future that the metaverse brings.

Written by Lucia van Leeuwen and Marike Breed. Lucia and Marike are lawyers within the Intellectual Property Law and Litigation practice groups of Köster Advocaten in Haarlem, the Netherlands. Köster Advocaten regularly deals with topical legal issues here. See Home » Köster advocaten .

This article originally appeared on FashionUnited.NL. Translation and edit by: Rachel Douglass.