![Second Life: Applications
Games and entertainment
[Picture of games and entertainment]](https://image.slidesharecdn.com/virtualworldspresentationtocambridgeuniversity-130322182934-phpapp02/85/Virtual-worlds-13-320.jpg)
![Second Life: Applications
Researching new concepts / products
[Pic of researching new concepts]](https://image.slidesharecdn.com/virtualworldspresentationtocambridgeuniversity-130322182934-phpapp02/85/Virtual-worlds-21-320.jpg)
![Legal issues (1): Ownership of assets
• “Second Life is a 3-D virtual world entirely built and owned
by its Residents … Because Residents retain the rights to
their digital creations, they can buy, sell and trade with
other Residents.”
(http://secondlife.com/whatis) [2007]
• Second Life® is a 3-D virtual world created by its
Residents … Because Residents retain the rights to their
digital creations, they can buy, sell and trade with other
Residents.”
(http://secondlife.com/whatis) [2008]](https://image.slidesharecdn.com/virtualworldspresentationtocambridgeuniversity-130322182934-phpapp02/85/Virtual-worlds-40-320.jpg)
![Legal issues (10):
Spotlight on intellectual property
C. Ownership of IP in virtual assets (3)
Second Life® is a 3-D virtual world created by its
Residents … Because Residents retain the rights to their
digital creations, they can buy, sell and trade with other
Residents.”
(http://secondlife.com/whatis) [2008]](https://image.slidesharecdn.com/virtualworldspresentationtocambridgeuniversity-130322182934-phpapp02/85/Virtual-worlds-66-320.jpg)
Uploaded byRob Blamires
Virtual worlds
The presentation discussed virtual worlds like Second Life, their applications in areas like commerce, education and research, and some of the key legal issues around these virtual environments including ownership of virtual assets, intellectual property concerns, and how real world laws apply to activities within virtual worlds given challenges around jurisdiction and anonymity.
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Virtual worlds
- 1. Virtual Worlds RobertBlamires Digital Media Lawyer, Technology Law Group Field Fisher Waterhouse LLP robert.blamires@ffw.com Presentation to Cambridge University 24 February 2009
- 2. Contents • Introduction to virtual worlds and Second Life • Applications • Commerce • Key legal issues • Spotlight on intellectual property • Conclusions
- 3. Virtual Worlds: Introduction •Virtual Worlds • Some goal-based • Some free-form • Characterised by persistence, interactivity, large numbers of simultaneous users • Second Life • Informed estimates suggest US$2 billion real money on MMOG in-world transactions between users in 2007
- 4.
- 5. Virtual worlds: SecondLife • One of many synthetic worlds • Established in 2003 • Now more than 16.5 million registered users • More than 8 million unique residents • 112 million user hours per quarter • More than US$33 million spent per month in-world
- 6. Second Life: Reallife presences • Universities • Religious institutions • Nicolas Sarkozy • Unofficial US Presidential Campaigns • The Maldivian Embassy, the Swedish Embassy • Dublin, Venice, Knightsbridge, Tokyo
- 7. Second Life: Reallife businesses and brands
- 10. Second Life: Applications • Real time collaboration / communication between multiple participants • Political, social, cultural and artistic activities • Games and entertainment • Training and education • Researching new concepts / products • Selling goods and services
- 11. Second Life: Applications Realtime collaboration/communication
- 12. Second Life: Applications Political,cultural, social and artistic activities
- 13. Second Life: Applications Games and entertainment [Picture of games and entertainment]
- 14. Second Life: Applications Training and education
- 15. Second Life: Applications Training and education
- 16. Second Life: Applications Training and education
- 17. Second Life: Applications Training and education
- 18. Second Life: Applications Trainingand education
- 19. Second Life: Applications Trainingand education
- 20. Second Life: Applications Researchingnew concepts / products
- 21. Second Life: Applications Researchingnew concepts / products [Pic of researching new concepts]
- 22. Second Life: Applications Researchingnew concepts / products
- 23. Second Life: Applications Researchingnew concepts / products
- 24. Second Life: Applications SecondLife: Transactions may take place into the services Selling goods and real world
- 25. Second Life: Commerce •In World: Consumer to consumer • In World: Business to consumer • In World: Business to business • Into the real world • In secondary markets
- 26. Second Life: Commerce In-world:consumer to consumer
- 27. Second Life: Commerce In-world:consumer to consumer
- 28. Second Life: Commerce In-world:business to business
- 29. Second Life: Commerce Into the real world
- 30. Second Life: Commerce Into the real world
- 31. Second Life: commerceCommerce Second Life: Into the real world Transactions may take place into the real world
- 32.
- 33. Second Life: Commerce Payments Transactionscan be paid for: • ‘in-world’ in Linden $ • ‘round world’ via transactional website from SL hyperlink, generally in US $ Linden $ are exchangeable for US $
- 34. Second Life: Commerce Applicablerules Which rules apply to Second Life commerce? • Technology • Second Life Community Standards • Behavioural guidelines (the ‘Big Six’): Intolerance, Harassment, Assault, Disclosure, Indecency, Disturbing the Peace • Second Life Terms of Service • Vendor contractual terms imposed in world and via transactional websites accessed from Second Life • Resident custom and practice? • Applicable law (the law doesn’t stop on entry)
- 35. Second Life: Commerce Applicablerules Applicable law? • Challenging area • Affected by: • nature of issue at hand – contract, tort, crime • where contracts are involved, whether dealing with a consumer and/or on standard terms, and • willingness of local courts to exercise extra-territorial jurisdiction • Complicated by: • anonymity, and • lack of jurisdiction information
- 36. Legal issues 1. Ownershipof assets 2. Consumer protection 3. Regulated activities 4. Employment 5. Tax 6. Competition 7. Content liability 8. Privacy 9. Crime 10. Intellectual property
- 37. Legal issues Compounded by: • Anonymity • Global nature • cross-border issues • lack of jurisdictional information • Problems of enforcement
- 38. Legal issues (1):Ownership of assets • Nature of in world assets and transactions • Ownership of assets • “Second Life is a 3-D virtual world entirely built and owned by its Residents … Because Residents retain the rights to their digital creations, they can buy, sell and trade with other Residents.” (http://secondlife.com/whatis/)
- 39. Legal issues (1):Ownership of assets
- 40. Legal issues (1):Ownership of assets • “Second Life is a 3-D virtual world entirely built and owned by its Residents … Because Residents retain the rights to their digital creations, they can buy, sell and trade with other Residents.” (http://secondlife.com/whatis) [2007] • Second Life® is a 3-D virtual world created by its Residents … Because Residents retain the rights to their digital creations, they can buy, sell and trade with other Residents.” (http://secondlife.com/whatis) [2008]
- 41. Legal issues (1):Ownership of assets • Under the Terms of Service • Users own all IP in content they create • However, Linden: • reserves rights to terminate accounts and hold onto assets without reimbursement • reserves rights to deny, block or reverse Linden $ transactions, and • takes broad licences of all IP in content
- 42. Legal issues (2):Consumer protection • Application of contract and general consumer protection law • Application of specific ecommerce and distance selling regulations
- 43. Legal issues (2):Consumer protection
- 44. Legal issues (3):Regulated activities • Regulated activities: for example gambling, sale of prescription medicines, financial services, etc
- 46. Legal issues (3):Regulated activities
- 47. Legal issues (4):Employment
- 48.
- 50. Legal Issues (5):Tax The Electric Sheep Company • IRS ruling that ESC “greeters” for its CSI:NY promotion were “employees” rather than independent contractors • Under IRS rules, companies must: • withhold income taxes • withhold and pay Social Security and Medicare taxes, and • pay unemployment tax on wages paid to an employee, but not on wages paid to a contractor. • IRS can impose fines, penalties, and back taxes for misclassifying an employee as an independent contractor
- 51. Legal issues (6):Competition
- 52. Legal issues (7):Content liability • For example, defamation, obscene publications etc
- 53. Legal issues (8):Privacy
- 54. Legal issues (9):Crime • Paedophilia • Theft • Phishing • Hacking • Fraud
- 55. Legal issues: Crime(9) Hacks and cheats – system hacks
- 56. Legal issues: Crime(9) Phishing
- 57. Legal issues: Crime(9) Consumer fraud – pyramid schemes
- 58. Legal issues: Crime(9) Consumer fraud – empty box scams
- 59. Legal issues: Crime(9) Consumer fraud – island scams
- 60. Legal issues (10) Spotlighton intellectual property A. IP refresher B. IP in virtual assets C. Ownership of IP in virtual assets D. IP ‘tour’ E. Recommendations
- 61. Legal issues (10): Spotlighton intellectual property A. IP refresher (1) • Broad range of legal rights that attach to inventions, software, artistic and musical works, performances, brands, data bases, designs etc • Do not protect ‘ideas’ on their own: only the expression of those ideas • Protect inventors, programmers, authors, artists, brand owners • Generally tradable and transferable • Generally jurisdictionally specific • A shield and a sword
- 62. Legal issues (10): Spotlighton intellectual property A. IP refresher (2) • Monopoly rights • Ability to exploit • Right to prevent infringement: • Injunctions • Damages • Seizure / accounting for profits • Sometimes punitive damages available
- 63. Legal issues (10): Spotlighton intellectual property B. IP in virtual assets • Typically Copyright and Trade Mark • Copyright protects: • Creative and artistic works (eg literature, software, movies, music, art, photographs, performances, broadcasts and film and sound recordings) • In Second Life, copyright will protect virtual buildings and items, textures, scripts and software, ‘performances’ • Trade Mark rights protect • ‘signs’ (eg words and logos) used in the course of trade to distinguish one traders goods and services from others
- 64. Legal issues (10): Spotlighton intellectual property C. Ownership of IP in virtual assets (1) • Copyright • Typically copyright owned by creator • Exception: copyright in works created by employees will be owned by employer if created in the ‘course of employment’ • Commissioned works! • Trade Mark • Registered marks owned by registered proprietors • Unregistered marks
- 65. Legal issues (10): Spotlighton intellectual property C. Ownership of IP in virtual assets (2)
- 66. Legal issues (10): Spotlighton intellectual property C. Ownership of IP in virtual assets (3) Second Life® is a 3-D virtual world created by its Residents … Because Residents retain the rights to their digital creations, they can buy, sell and trade with other Residents.” (http://secondlife.com/whatis) [2008]
- 67. Legal issues (10): Spotlighton intellectual property • Under the Terms of Service • Users own all IP in content they create • However, Linden: • reserves rights to terminate accounts and hold onto assets without reimbursement • reserves rights to deny, block or reverse Linden $ transactions, and • takes broad licences of all IP in content
- 68. Legal issues (10): Spotlighton intellectual property C. Ownership of IP in virtual assets(5) • ‘You agree that even though you may retain certain copyright or other intellectual property rights with respect to Content you create while using the Service, you do not own the account you use to access the Service, nor do you own any data Linden Lab stores on Linden Lab servers …Your intellectual property rights do not confer any rights of access to the Service or any rights to data stored by or on behalf of Linden Lab.’ • ‘When using the Service, you may accumulate Content, Currency, objects, items, scripts, equipment, or other value or status indicators that reside as data on Linden Lab's servers. THESE DATA, AND ANY OTHER DATA, ACCOUNT HISTORY AND ACCOUNT NAMES RESIDING ON LINDEN LAB'S SERVERS, MAY BE DELETED, ALTERED, MOVED OR TRANSFERRED AT ANY TIME FOR ANY REASON IN LINDEN LAB'S SOLE DISCRETION … AND WITH NO LIABILITY OF ANY KIND.’
- 69. Legal issues (10): Spotlighton intellectual property D. IP infringement ‘tour’ • Infringing virtual assets • Infringing physical assets marketed in Second Life • Enforcement • Recommendations
- 70.
- 71. Infringing virtual assets VirtualWorlds: IP Challenges
- 72.
- 73.
- 74.
- 75.
- 76.
- 77. Infringing physical assetsmarketed in Second Life
- 78. Infringing physical assetsmarketed in Second Life
- 79. Infringing physical assets marketed in Second Life
- 80. Infringing physical assets marketedin Second Life
- 81. Infringing physical assetsmarketed in Second Life
- 82. Enforcement: Role ofthe platform operator? Second Life Terms of Service enable Linden to take action against IP infringement: • Users agree not to transmit content that infringes or violates any 3rd party rights (and Linden may suspend or terminate their account for breach) • copyright-infringing materials can be identified and removed in accordance with Linden Lab’s Digital Millennium Copyright Act compliance process But…
- 83. Enforcement: Role ofthe platform operator? Linden’s intervention not necessarily satisfactory, at least not for all IP owners: • IP owners lack contractual rights under the Terms of Service to require Linden to remove infringing content (the IP owners may not even be Second Life residents) • A resource intensive task, therefore • probably unmanageable, and, in any case • unlikely to produce solutions acceptable to all relevant IP owners
- 84. Enforcement: Role ofthe platform operator? • Linden not well placed to determine whether IP infringement is taking place – Linden is not a court or authorised dispute resolution body • Linden unable to provide or enforce financial remedies • Platform operator unlikely to be generally willing or able to provide necessary resolution
- 85. Enforcement: Eros vJohn Doe Possibly the first Second Life copyright infringement claim Eros created and sold “SexGen” virtual products, including a virtual bed for $45 “Volkov Cattaneo” selling a similar virtual bed for $15 Eros: “has been damaged, and continues to be irreparably damaged by the diversion of sales” Sued for damages equivalent to three times Cattaneo’s estimated profit. Suing John Doe…
- 86. Enforcement: Marvel vCryptic Studios Virtual world based on superhero comic books Users creating avatars based on characters trade marked by Marvel Trade mark infringement? Probably not because not use in commerce
- 87. Virtual Worlds IP:Recommendations • Monitor and manage use of your brands and content in virtual environments • When building a virtual worlds presence: • Understand the platform operator’s rights • Ensure your brands and content are properly protected • Beware of having infringement built into your premises • If selling goods / services in a virtual environment, make sure you get the IP ownership / licensing right: • Check you have the necessary rights • Ensure your IP is protected • Be careful about what you assign/license
- 88. Conclusions • Highly dynamic area – constant technological and business change • The law doesn’t stop at the edges of the computer screen – it’s capable of touching almost everything in virtual worlds, as in RL • But, jurisdictional uncertainty, relative anonymity, different rule-sets, and the inability of law-makers and regulators to perfectly anticipate virtual world developments means laws will not always apply appropriately or as you’d expect • And the law can never be totally future-proof…
- 89. Robert Blamires Digital MediaLawyer Technology Law Group Field Fisher Waterhouse e: robert.blamires@ffw.com Avatar: Declan Shelman