Brick by Brick: Understanding IP Rights in Metaverse Buildings

Building a virtual world often involves just that—buildings. But developers of metaverse properties may not know which legal rights are at issue. Can a virtual world incorporate a rendition of a real-life building without infringing on the rights of real-life property owners? Does the architect, owner, or user of a brick-and-mortar building have any rights to assert against a twin building in the metaverse? How does the developer of a virtual building take the building from one virtual world to another?

The answer depends on—and may vary based on—who is asserting the rights, whether copyrights or trademarks are at issue, and whether any of these rights have been assigned to another party.

Copyright Law

Under U.S. copyright law, the exact question has not been adjudicated, but commentary in analogous contexts provides helpful guidance. While the U.S. Copyright Act protects architectural works, it does not prohibit “displays” of architectural works that are visible from public places. This differs from the protection for other works, e.g., a photograph—where the photographer could prevent others from displaying it. For architectural works, display is expressly excluded from those rights granted to the owner of the copyright. (It is important to note that the architect, not the building owner, is the owner of the copyright to an architectural work unless the architect assigns that copyright to the owner.)

This narrow exception does not cover 3-D reproductions. In this context, 3-D means a physical 3-D object and not a 2-D representation that is designed to appear 3-D. So, for example, a seller of model building souvenirs would need a license from the owner of the underlying architectural work.

But while the metaverse has increasingly offered users a 3-D, lifelike experience, the consensus of existing precedent and legal scholarship is that a depiction of a work on a computer, whether in conjunction with a CAD program or a virtual world, is not a 3-D copy within the meaning of the statute. On-screen representations, even in virtual worlds, have generally been treated as 2-D displays, not 3-D copies.

That said, the available commentary is several years old and a court viewing the question in light of today’s more advanced virtual technologies—which give the true feeling of being in 3-D space—might conceivably view things differently. So while developers of virtual real estate likely would have a good faith basis to say they do not infringe U.S. rights when they create metaverse renditions of real-life buildings, there is always a small risk that a court could decide the issue differently—especially as only scholars, not courts, appear to have opined on the issue of 2-D versus 3-D categorization of virtual worlds in this context.

Developers of metaverse “architecture” may also have different rights under copyright law than developers of real-world architecture. A discrete architectural work in the metaverse would likely be considered a graphical work (and the underlying code would also be protectable as a copyrighted software work). So digital imitators of metaverse architecture may actually face more constraints than digital imitators of real-world architecture.

Trademark Law

While copyright alone may not provide architects protection against virtual renditions of their buildings, trademark rights could. Specific buildings are often the subject of both trademark and copyright protection. For example, certain depictions of the Empire State Building are registered trademarks, granting the trademark owner the right to prevent confusing uses of those depictions on various products sold in commerce.

Where a distinctive real-life building is replicated in the metaverse, the owners of any associated trademark rights in that building could argue that virtual uses are likely to confuse consumers and lead them to think that the virtual use is related to, sponsored by, or affiliated with the owners of the real-world building. And, as we recently discussed, courts have been reluctant to throw out trademark suits where a digital product bore the trademark of a physical brand.

Trademark registration of buildings is connected to a specific use for which the trademark is known. For example, real-world buildings that have trademark registrations include:

• The iconic spire of the Chrysler Building in New York (U.S. Trademark Registration No. 1,126,888 for use in connection with “leasing office space and attendant services to tenants”)
• Willis Tower in Chicago (U.S. Trademark Registration No. 3,779,129 for use in connection with “[r]eal estate services, namely, listing, leasing and managing commercial property and office buildings”)”

Therefore, a metaverse twin of the Chrysler Building or the Willis Tower used as a virtual shopping center, for example, might not violate the trademark registration.

However, the analysis can become more complicated when the real-life building is deemed a famous trademark. Famous marks enjoy protection even against uses not related to the uses for which the mark is registered.

In addition, even non-famous marks can often enforce against uses in the “natural zone of expansion” of the mark’s registered uses. So, for example, owners of a building that leases commercial space could argue that because such buildings are often homes to shopping centers, a metaverse use of a trademarked building as a shopping center would confuse consumers into believing the metaverse building is related to, sponsored, or endorsed by the owners of the physical building.

These questions all remain unsettled in the context of the metaverse, so developers should proceed with caution until courts put their own stake in the ground on these issues.

Contract Law

Let’s assume a metaverse developer has gotten comfortable that the designed building is unlikely to be considered infringing of any real-world building developer’s copyright or trademark rights and is a graphical work protectable on its own under U.S. copyright law. Even in this scenario, the developer must consider whether it retains these intellectual property rights when building in their chosen metaverse.

To state perhaps the obvious, there is currently no single, all-encompassing metaverse where developers are building and placing their virtual buildings. Instead, there are many separate virtual spaces—created, hosted, curated, and maintained by various companies—that invite developers to build properties within their spaces’ versions of the metaverse.

Both developers and users are provided access to these virtual worlds subject to certain terms and conditions. For the developer, it will be important to review these terms to determine whether the U.S. intellectual property rights associated with any developed architectural works are retained by the developer or assigned to the operator of the virtual world. Knowing whether these rights are assigned may affect the developer’s decision as to where to build—especially as the developer may not be able to prevent others from copying the original work or be able to take the original work to other virtual worlds.