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The ability to engage customers in an interactive virtual space presents brand owners with new business opportunities, to advertise, test, and sell both virtual and real-world goods. For example, Nike sells digital sneakers to online players on the Roblox platform to customize its avatar's footwear. And KFC announced plans to launch virtual restaurants, where users can enter a digital KFC online and order real food for delivery. In short, the metaverse is open for business.
The limited cases alleging trademark issues in virtual spaces supports this reasoning. The developer of \"Second Life,\" an early metaverse platform where online \"residents\" control 3D avatars to simulate real-life activities, faced several infringement suits by owners of trademarks for both real world and virtual goods. For example, Taser sued Linden Research after discovering residents were utilizing the trademarked word \"taser,\" including in advertisements for similar products, which led to Linden Research removing all instances of the word from the platform. Taser Int'l, Inc. v. Linden Rsch, Inc., No. 09-CV-00811 (D. Ariz. 2009). Linden Research also settled a suit by a \"Second Life\" resident who alleged that the developer facilitated the counterfeiting of its virtual goods by charging fees to access the in-game market. Eros, LLC v. Linden Rsch, Inc., No. 09-cv-04269-PJH (N.D. Cal. 2009). These cases demonstrate that trademark owners are using traditional trademark laws to address virtual infringement issues.
It is also expected that the First Amendment defense will be raised by alleged infringers in the metaverse, as this defense has been successful in cases involving infringement claims in the video game context. Under this defense, courts allow use of a trademark owner's mark for expressive purposes if the use has artistic relevance and does not explicitly mislead consumers. In AM General LLC v. Activision Blizzard, Inc., 450 F.Supp.3d 467 (S.D.N.Y. 2020), the court held that the video game publisher for \"Call of Duty,\" a narrative-heavy military shooter game, did not infringe on the Humvee trademark based on the First Amendment defense. The use of Humvees was artistically relevant because it provided a sense of military realism, and it was unlikely to mislead players for a variety of reasons, including the parties' dissimilar uses and the differences in the parties' businesses.
Finally, an alleged infringer in the metaverse may challenge whether an asserted mark actually covers a good or service. For example, in Brantley v. Epic Games, Inc., 463 F.Supp.3d 616 (D. Md. 2020), the plaintiffs alleged the publishers of the online multiplayer game \"Fortnite\" committed false designation of origin by selling customized dance moves for players that included the plaintiffs' allegedly trademarked \"Running Man\" dance. The court held the plaintiffs lacked a valid trademark because their dance designated an underlying choreographic concept, not a good. This defense may have traction in some metaverse cases given the amorphous nature of virtual goods and services that are commercially viable on online platforms.
The limited cases alleging trademark issues in virtual spaces supports this reasoning. The developer of "Second Life," an early metaverse platform where online "residents" control 3D avatars to simulate real-life activities, faced several infringement suits by owners of trademarks for both real world and virtual goods. For example, Taser sued Linden Research after discovering residents were utilizing the trademarked word "taser," including in advertisements for similar products, which led to Linden Research removing all instances of the word from the platform. Taser Int'l, Inc. v. Linden Rsch, Inc., No. 09-CV-00811 (D. Ariz. 2009). Linden Research also settled a suit by a "Second Life" resident who alleged that the developer facilitated the counterfeiting of its virtual goods by charging fees to access the in-game market. Eros, LLC v. Linden Rsch, Inc., No. 09-cv-04269-PJH (N.D. Cal. 2009). These cases demonstrate that trademark owners are using traditional trademark laws to address virtual infringement issues.
It is also expected that the First Amendment defense will be raised by alleged infringers in the metaverse, as this defense has been successful in cases involving infringement claims in the video game context. Under this defense, courts allow use of a trademark owner's mark for expressive purposes if the use has artistic relevance and does not explicitly mislead consumers. In AM General LLC v. Activision Blizzard, Inc., 450 F.Supp.3d 467 (S.D.N.Y. 2020), the court held that the video game publisher for "Call of Duty," a narrative-heavy military shooter game, did not infringe on the Humvee trademark based on the First Amendment defense. The use of Humvees was artistically relevant because it provided a sense of military realism, and it was unlikely to mislead players for a variety of reasons, including the parties' dissimilar uses and the differences in the parties' businesses.
Finally, an alleged infringer in the metaverse may challenge whether an asserted mark actually covers a good or service. For example, in Brantley v. Epic Games, Inc., 463 F.Supp.3d 616 (D. Md. 2020), the plaintiffs alleged the publishers of the online multiplayer game "Fortnite" committed false designation of origin by selling customized dance moves for players that included the plaintiffs' allegedly trademarked "Running Man" dance. The court held the plaintiffs lacked a valid trademark because their dance designated an underlying choreographic concept, not a good. This defense may have traction in some metaverse cases given the amorphous nature of virtual goods and services that are commercially viable on online platforms.
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