Key Takeaways:

  • NFTs and Copyright: Owning an NFT doesn’t grant copyright ownership. The original creator retains copyright unless explicitly transferred.
  • Unauthorised reproduction, distribution, plagiarism, and adaptation of copyrighted material in NFTs are all infringements.
  • Identifying Infringement: Monitor NFT marketplaces, use digital tools, and engage with your community to stay vigilant.

NFT copyright infringement emerges at the intersection of cutting-edge blockchain technologies and the traditional boundaries of copyright law, presenting unique challenges from a copyright perspective.

As the minting of NFTs transforms digital assets into material objects for commercial purposes, it often leads to copyright trouble. This new frontier tests the limits of copyright licensing, requiring a nuanced understanding of how copyright ownership applies in the digital age.

The proliferation of NFTs highlights the need for clarity in how copyright laws adapt to and encompass the innovative processes behind these digital tokens, ensuring creators’ rights are protected while fostering technological advancement.

What is an NFT?

An NFT is a digital asset that represents real-world objects like art, music, in-game items, and videos. They are bought and sold online, frequently with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.

Unlike cryptocurrencies, which are interchangeable, NFTs are unique or “non-fungible,” making them digital certificates of ownership for specific items or content.

Who Owns the Copyright?

Understanding copyright ownership in the context of an NFT can be complex, primarily due to the dual nature of what an NFT represents:

(i) the unique, non-duplicable, and transferable digital token stored on the blockchain, and

(ii) the artistic or creative work associated with it.

It’s important to distinguish between these two components. The copyright pertains to the creative work itself, which remains separate from the blockchain token.

Therefore, the copyright is held by the individual or organisation that originally produced the creative content. This ownership does not change, even when the NFT is purchased by another party.

What is NFT Copyright Infringement?

copyright infringement nft

NFT copyright infringement occurs when someone creates, sells, or distributes a Non-Fungible Token (NFT) that includes copyrighted material without obtaining permission from the copyright holder.

This infringement can take various forms, such as using someone else’s artwork, music, videos, or other forms of creative content to mint an NFT without the original creator’s consent.

Since NFTs are unique digital assets that represent ownership or proof of authenticity of digital or physical assets, using copyrighted material without authorisation directly violates the rights of the copyright owner.

This unauthorised use can lead to legal disputes, financial penalties, and the removal of the infringing NFTs from marketplaces.

Common Types of NFT Copyright Infringement

NFT copyright infringement manifests in several common forms, each undermining the rights of copyright holders and posing legal risks to infringers. These include:

Unauthorised Reproduction: This occurs when someone copies a copyrighted work—be it art, music, video, or any digital content—without permission and mints it as an NFT. This direct copying infringes on the copyright holder’s exclusive right to reproduce their work.

Unauthorised Distribution: Involves distributing copyrighted material through the sale or transfer of NFTs without the copyright owner’s consent. Even if the NFT creator has access to the original work, selling it as an NFT without authorisation infringes on the copyright holder’s distribution rights.

Plagiarism and Counterfeit NFTs: This form of infringement happens when someone creates an NFT that is a direct copy or so closely mimics another’s copyrighted work that it can deceive buyers into thinking they are purchasing a genuine NFT created by the original artist.

This not only violates copyright law but also damages the market and reputation of the original creators.

Adapting Copyrighted Content for Use in NFTs: This involves altering or modifying someone else’s copyrighted work for the purpose of creating a new NFT, without obtaining permission from the copyright owner.

This could include creating derivative works based on the original copyrighted material, which still requires the copyright holder’s consent.

Each of these types of infringement highlights the importance of understanding and respecting copyright laws in the digital and NFT spaces to avoid legal complications and ensure the ethical use of creative content.

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Who Can Enforce Against an Infringing NFT?

Enforcement against an infringing NFT primarily falls to the copyright holder of the original work that the NFT is based upon or incorporates, or someone that is authorised by the copyright owner.

Copyright holders possess exclusive rights to their creations, including the right to reproduce, distribute, and create derivative works from the original content.

When these rights are violated by the creation or sale of an NFT without permission, the copyright owner or their authorised representative has the legal authority to take action to protect their intellectual property.

How Do I Identify NFT Infringement?

Identifying NFT infringement involves a combination of vigilance, technological tools, and sometimes legal advice to detect unauthorised use of copyrighted material.

Here are steps and strategies to help copyright holders identify potential NFT infringements:

  • Regular Monitoring of NFT Marketplaces: Keep an eye on popular NFT platforms and marketplaces for any new listings that may use your copyrighted material without permission. This includes searching for your name, your works’ titles, or any unique identifiers associated with your content.
  • Use of Digital Tools and Services: There are digital tools and services designed to scan NFT marketplaces for specific images, videos, or other forms of digital content. These tools can alert you to potential infringements by finding matches or similarities to your copyrighted works.
  • Reverse Image Search: For visual content, reverse image search engines can help identify where your images are being used on the internet, including on NFT platforms. This can be a quick way to spot unauthorised reproductions.
  • Monitoring Social Media and Online Forums: Sometimes, infringing NFTs are promoted on social media platforms or discussed in online forums. Keeping an eye on these spaces can help you catch infringements early.
  • Engaging with Your Community: Fans and followers of your work can be invaluable in spotting and reporting potential infringements. Encourage them to alert you if they come across NFTs that appear to use your copyrighted material without authorisation.
  • Legal Assistance: Consider consulting with a legal professional specialising in intellectual property rights. They can offer advice on setting up more formal monitoring systems, interpreting the results, and taking action when infringements are identified.

By employing these strategies, copyright holders can more effectively identify unauthorised NFTs and take appropriate steps to address copyright infringement.

NFT Copyright Infringement Cases

Hermès versus Mason Rothschild

In the landmark case of Hermès versus Mason Rothschild, a New York jury found that Rothschild’s ‘MetaBirkin’ NFTs infringed upon Hermès’ trademark rights.

The case revolved around Rothschild’s unauthorised sale of NFTs depicting imitations of Hermès’ iconic purses.

Hermès was awarded $133,000 in damages, marking a pivotal moment for brand owners by underscoring that trademarked content cannot be freely utilised in NFTs without permission, thus addressing NFT intellectual property theft.

This lawsuit sets a significant precedent in the U.S., clarifying that reproducing registered trademarks or copyrights as NFTs for resale without the owner’s consent is illegal.

The decision is expected to influence how NFT copyright infringement is approached in the future, reinforcing the protection of intellectual property rights within the digital asset space.

nft copyright infringement cases

Nike versus StockX

In another case, Nike versus StockX, Nike initiated legal action against the online marketplace StockX for its Vaulted NFT program, which allegedly offered digital versions of Nike sneakers without authorisation, potentially leading to consumer confusion.

Nike’s lawsuit, filed in the New York District Court, accuses StockX of infringing on Nike’s trademarks.

This ongoing legal battle highlights the determination of major brands to protect their intellectual property rights against unauthorised use by NFT creators and sellers, signaling the evolving landscape of IP law in relation to NFTs.

Relevant Intellectual Property Rights as They Apply to NFT Copyright Infringement

NFT copyright infringement can lead to significant legal challenges, particularly for rights holders determined to protect their intellectual property.

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If you discover that your copyright has been violated due to unauthorised use in NFTs, you might have grounds to take legal action against the creators, minters, and distributors under copyright or trademark laws.

Key intellectual property rights relevant to NFT copyright infringement include:

Copyright: In the United States, copyright law safeguards “original works of authorship,” encompassing a wide range of creative expressions such as literature, music, drama, art, graphics, architecture, and audio-visual works.

Many companies safeguard their brand-related content by registering copyrights with the U.S. Copyright Office. The illicit production or sharing of NFTs that incorporate copyrighted material without authorisation threatens these intellectual property rights.

Trademark: Trademarks grant an individual or company exclusive rights to use a specific name, phrase, logo, symbol, design, or image.

To protect their brand identity, businesses often register their trademarks with the U.S. Patent and Trademark Office. Unauthorised use or distribution of NFTs that contain trademarked content constitutes trademark infringement.

Right of Publicity: This intellectual property right prevents the unauthorised commercial use of an individual’s name, likeness, or other identifiable characteristics. Creating or distributing NFTs without permission that feature someone’s name, likeness, or image could violate their right of publicity.

These intellectual property rights play a crucial role in the context of NFT copyright infringement, offering a legal framework for rights holders to defend their creative works and brand identity against unauthorised use in the digital realm.

Impact of NFT Copyright Infringement on Brands

NFT copyright infringement can have profound and multifaceted impacts on brands, affecting their reputation, market value, and the integrity of their intellectual property.

The consequences of such infringements extend beyond simple legal disputes, touching on the very core of a brand’s relationship with its consumers and its position in the marketplace.

Here are some of the key ways in which NFT copyright infringement can impact brands:

  • Brand Dilution: Unauthorised NFTs can dilute a brand’s distinctiveness by flooding the market with similar or counterfeit digital assets. This dilution can confuse consumers and diminish the perceived value of the brand’s legitimate products or digital assets.
  • Loss of Revenue: When infringing NFTs are sold, the revenue generated from these sales does not go to the rightful copyright or trademark owners. This represents a direct loss of potential income for the brand, particularly if the NFT market for their content is significant.
  • Damage to Reputation: The association of a brand with unauthorised or low-quality NFTs can tarnish its reputation. Consumers may question the brand’s ability to protect its intellectual property or become wary of purchasing legitimate digital assets for fear of supporting infringement.
  • Legal and Enforcement Costs: Pursuing legal action against NFT copyright infringement requires resources, including time, money, and legal expertise. The process of identifying, challenging, and removing infringing NFTs can be costly and distract from other business priorities.
  • Consumer Confusion: Unauthorised NFTs can lead to confusion among consumers regarding the authenticity and origin of digital assets. This confusion can undermine trust in the brand and deter consumers from engaging with its legitimate digital offerings.
  • Impact on Partnerships and Collaborations: Brands often collaborate with artists, creators, and other brands to produce official NFTs. Copyright infringement can complicate these relationships, potentially leading to disputes or reluctance among potential partners to engage in future collaborations.

In response to these challenges, brands must be proactive in monitoring for NFT copyright infringement and ready to enforce their intellectual property rights.

Strategies may include educating consumers about official digital assets, employing technological solutions to detect and address infringements, and pursuing legal action when necessary to protect the brand’s interests.

nft art copyright infringement

How Do I Remove NFT Infringement?

Removing NFT infringement typically involves:

  1. Contacting the NFT platform to file a takedown notice.
  2. Sending a cease and desist letter to the infringer.
  3. Seeking legal recourse to enforce copyright and remove the infringing content.

Protecting Against NFT Copyright Infringement

To safeguard against NFT copyright infringement, it’s essential for brands and creators to actively engage in copyright protection measures. This includes registering their copyrights and trademarks to secure legal acknowledgment of their intellectual property (IP) rights, affirming them as the sole owner of their original creations.

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Consistently monitoring NFT marketplaces and employing digital tools that leverage digital signatures for detecting unauthorised use of content can preemptively spot instances of infringement of copyright.

These digital signatures also serve as proof of ownership, reinforcing the creator’s entire copyright over the digital version of their work.

Consulting with legal professionals familiar with the intricacies of IP law in the digital and NFT realms is vital.

Using blockchain technology not only authenticates but also tracks legitimate digital assets, providing a robust technical defense against unauthorised minting—a common practice among infringers.

Educating the public and enthusiasts on the significance of acquiring authentic NFTs highlights the detrimental effects of copyright infringement on creators, promoting a culture of respect within the digital ecosystem.

Prompt legal action against copyright violators underscores a commitment to protecting IP rights, serving as a deterrent to potential infringers.

By implementing these strategies, creators and brands can more effectively shield their work from unauthorised exploitation in the evolving NFT marketplace.

nft and copyright infringement

Conclusion

The landscape of NFT copyright infringement underscores the critical need for a robust framework in intellectual property law that addresses the nuances of digital creation and the transfer of copyright ownership.

Unauthorised minting and the distribution of digital copies without the content creator’s consent amplify the likelihood of copyright infringement across the majority of NFTs.

To mitigate these risks, the actual transfer of rights and clear standard terms, especially regarding future sales, must be integral to the minting process.

This approach will ensure that the innovative potential of NFTs can be realised while safeguarding the rights and interests of creators within the digital domain.

Integrating Bytescare Digital Protection further secures creators against infringement risks. For creators navigating the NFT space, adopting a legally informed approach is essential. For more information on safeguarding your digital assets, please contact us.

FAQs

Can you get copyright infringement on NFTs?

Yes, creating or selling NFTs that use copyrighted material without permission can lead to copyright infringement.

Who owns the copyright of an NFT?

The original creator of the digital content associated with an NFT typically retains the copyright, unless they have transferred those rights.

What happens if someone uses your art as an NFT?

If someone uses your art as an NFT without permission, it constitutes copyright infringement, and you can take legal action to enforce your rights.

What do you actually own if you buy an NFT?

Buying an NFT usually grants you ownership of a unique digital item and the right to use, display, or resell it, but not the copyright to the underlying content.

Can you make an NFT of copyrighted material?

Making an NFT of copyrighted material without permission is copyright infringement. You need authorisation from the copyright holder to legally create and sell such an NFT.

What implications does this convey regarding NFT creators?

NFT creators must ensure they have the rights to the content they use for their NFTs to avoid legal issues and respect copyright laws.

What is the role of smart contracts in the sale of NFT?

The transaction of an NFT always involves a ‘smart contract,’ acting as an agreement between parties, coded and stored on the blockchain.

NFTs reside within the digital ledger of the blockchain, creating a digital signature and facilitating ownership tracking. In a transaction, the smart contract facilitates the NFT sale and verifies ownership.