To the metaverse and beyond – Considerations for trade mark owners

The metaverse is a virtual reality construct where there is an overlap between reality and the online 3D virtual environment. The metaverse is accessed through computers, smart devices and AR/VR technologies. Currently, Meta Platforms Inc. (formerly Facebook Inc.) is pushing the construct with plans to develop metaverse experiences, services and hardware so the ordinary person can enter the metaverse to work, shop, socialise, play games – the extent and application is somewhat limitless.

What does the metaverse mean for trade mark owners?

Should all trade mark owners think about expanding their trade mark filings to include virtually downloadable goods and secure rights and a presence in the metaverse?

Nike Inc. recently applied for a suite of new trade mark applications in the US for some of its most well-known marks including NIKE, Just Do It and the AIR JORDAN logo, covering various goods and services in classes 9 and 42, including downloadable virtual goods in class 9 and retail store services featuring virtual goods in class 42. Nike Inc.’s plans for these new trade marks are still unclear. What these filings indicate is that Nike Inc. may be preparing to enter the metaverse, perhaps by offering a virtual reality shopping experience. Or the applications may be a defensive strategy to stop infringing use with the expectation that its marks could appear, without consent, in the metaverse or be used on non-fungible tokens (NFTs).

The metaverse creates virtual settings which mimic the real world where participants can deal with, wear and touch branded products. In this setting, would the use of a trade mark infringe the rights of the trade mark owner for those equivalent goods in the real world? That is, does the trade mark owner need to apply separately for downloadable virtual goods if it is already the owner of those goods or services in the appropriate class in reality?

The question has not yet been tested before the courts but practically speaking, one would expect that a similar process and rationale will apply as that currently used for online infringements.

Metaverse scenario for consideration

Person X creates a metaverse dating experience and users can purchase items of clothing as NFTs to wear to their virtual date. Some of the NFT items for purchase are luxury branded clothing (all registered trade marks of third parties). Is the promotion and sale of those NFTs infringing the trade marks which appear on the clothing? If we compare it to online retail sales, the answer is likely to be yes. On the other hand, software or downloadable software (which arguably includes downloadable virtual goods) is generally not considered to be goods of a similar description to clothing, for example. This suggests that it would be far safer and prudent for brand owners to consider extending their filings to include downloadable virtual goods and/or services.

Presumably, this would be of interest to high profile brands globally assuming existing portfolios do not provide some coverage already.

To most of us the metaverse is still an enigma and its uptake and popularity unknown but there certainly appears to be momentum building. For brand owners (particularly those in the well-known consumer goods market) there may be valid reason to consider securing trade marks in that space to get a foot in the door, and also potentially as a defensive strategy to combat infringers, especially in jurisdictions where trade mark squatting is prevalent and it is important to file early - see Trade Mark and Brand Protection in China.

For now we will continue to watch this space, however, just as when the internet first launched and its capabilities and uses were not yet fully explored, there is certainly potential for the metaverse and its uses to become the new normal.