Virtual reality and computer game

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With the recent excitement around the "metaverse", NFTs, and the market for "virtual products" heating up, it is a good time to take a closer look at the protection of brands in computer games and virtual reality environments, as well as art, film and other media more broadly. In particular, this author looks to explore what happens when artistic creations and "virtual" or "fictional" brands start a life of their own.

The use of Trade Marks and other copyright material in creative works, such as art or film, and more lately, computer games and virtual reality applications has so far been a somewhat one-sided subject. Case law and jurisprudence, so far, has developed with the primary focus being on the unauthorised use in creative works of existing brands, and products bearing Trade Marks, which often already have a significant presence and reputation on the marketplace.

For example, it may be desirable for a character in a film to drive a particular brand of car because of the connotations attached to the brand and how the image influences character building in the artistic medium. James Bond would likely not look the same driving a reasonably priced car. Insofar as product placement is concerned, the principles are relatively straightforward — owners of brands wish their brands to be featured in creative works in such a way that it enhances the desirability of the products and the prestige of the brands.

Conversely, it is also desirable to prevent such uses, which in some way tarnish the reputation of the brand e. In other instances, advertising standards may limit the displaying of brands due to public policy or health concerns, e. There are notable exceptions to brand owners' rights in protecting their intellectual property from unauthorised use, such as fair use clauses in copyright law allowing under certain conditions for the fair use of elements of an artistic work for the purposes of education and parody, for example.

In terms of trade marks, the position tends to be different. Indeed, such an exception may not be desirable — or necessary — as a parody exception might unduly limit a trade mark owner's capabilities to exploit or enforce their rights.

Existing provisions in the Trade Marks Act , and a wealth of case law, already provide guidance as to when the use of a trade mark or of a similar mark constitutes infringing use, and conversely provide indication where uses of trade marks do not constitute an infringement. So, when it comes to game characters and various designs that a user might encounter in a film, computer game or in other AR or VR environments, protection potentially exists in the forms of copyright, designs, as well as trade marks.

In this article, I will focus primarily on the use of trade marks in the aforementioned environments and the measures of protection that might be available for rights holders. Compared to the scenario involving product placement or the use of "real life" trade marks as expounded above ,the waters become muddier when creative works feature "fictional Trade Marks".

These are brand names and logos, which are affixed to products or under which services are rendered in a fictional world without an authorised counterpart existence in the physical world. One notable example of a fictional Trade Mark is "Duff beer" from the Simpsons cartoon. Due to the show's popularity a number of breweries have attempted through the years to introduce the fictional "Duff beer" into the real world, arguably riding on the coat-tails of the reputation — or at least the recognisability - that the fictional brand name and logo have gained through their use in the cartoon.

In the case of "Duff", so far, the owners of the rights to "The Simpsons", Twentieth Century Fox Film Corporation, have been able to rely on copyright law to prevent some unauthorised uses, however, the protection afforded by copyright is more limited and would not extend to the word "DUFF" on its own.

For copyright protection to really come to the fore, the infringer should not only be using the name "Duff" but also perhaps the stylisation of the logo, a font known from and associated with the series, artwork or images of characters, or other copyright-protected works that would enable the rights holder to pursue an effective claim.

Such enforcement actions, however, also tend to be more difficult to substantiate and more costly to run as compared to oppositions or infringement cases based on registered trade marks. The latter types of actions benefit from a significantly higher rate of incidence, clearer and more straightforward procedural and evidentiary rules, and more developed case law, and thus are more predictable in their outcomes. Furthermore, a trade mark registration provides a sole right which could potentially carry on in perpetuity, whereas most other forms of intellectual property have limited lifespans.

So, why not simply register the fictional trade mark in respect of the goods or services on which it is used in the virtual context? That is, protection does not automatically extend to all possible goods and services. The issue is that in most territories in the world it is necessary to make actual commercial use of a trade mark in respect of the goods and services that are covered by the registration in order to maintain the registration in force.

In the UK and the EU, for example, trade mark registrations become vulnerable to cancellation on the grounds of non-use after a grace period of 5 years has passed since their registration.

When demonstrably no such intention exists, this could lead to repercussions for the applicant, including the loss of rights and potential other punitive sanctions. Continued use may also need to be demonstrated at intervals. Therefore the potential obstacle faced by proprietors of fictional trade marks, such as Duff , is a choice between either marketing the goods or services covered by the fictional trade mark in the real world, or licensing such rights to third parties one such example is the Coyote Ugly franchise of bars and restaurants , or potentially losing their trade mark registration s once the marks become vulnerable to challenge by third parties.

For the foregoing reasons, so far traditional registered trade mark infringement has not provided the main cause of action against copycats. The emergence of a new trend to file for particular "virtual goods", could, however, herald a change in the way jurisdictions approach trade mark infringement.

Arguably, "virtual shoes" in Class 9, which are marketed relying on NFTs, should be found to be similar to real "shoes" in Class 25 — although the broader categories of "software" and "footwear" would remain dissimilar — especially, if the market develops in such a way to tie in purchases of physical goods with ownership of the same goods in a virtual format — and perhaps vice versa, as many manufacturers of trainers already allow customers to customise the appearance of their footwear before the completion of the manufacturing process and physical sale.

A potential third option could be to rely on the reputation of a registered trade mark in a different class of goods or services, e. In order to rely on reputation, the owner of a trade mark would need to demonstrate that a the trade mark has a reputation in the territory in question, b that there would exist a link between the later use of the mark in respect of dissimilar goods or services and the original trade mark in the mind of the consumer, c that such use would take unfair advantage or be detrimental to the distinctive character or the reputation of the earlier mark and d that the later use of the mark is without due cause.

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