The Future of IP: Three Legal Dilemmas Facing Virtual and Augmented Reality Platforms

Ricci Dipshan, Legaltech News

From copyright licensing to fair use considerations and patent trolls, intellectual property technology may run into future legal challenges.

While recently launched virtual and augmented reality platforms like Oculus Rift or Pokémon Go are feats of modern innovation and engineering, these technologies are themselves not wholly unconnected to the world they seek to transform or supplement. And like every nascent and quickly developing technology, neither are they free of laws governing intellectual property (IP).

With so much yet unknown about their future, virtual and augmented reality platforms may yet run into complex legal dilemmas involving IP rights and ownership. Here are three ways in which these issues may manifest in the years to come.

1. Copyright Infringement and Licensing

The issue of copyright in the virtual and augmented reality space concerns not only how providers protect their own technology, but more importantly how their software developers use other copyrighted IP In their games and content.

Christian Mammen, partner at Hogan Lovells, explained that a simple way to think about these IP challenges is through Pokémon Go, arguably the most famous augmented reality game on the market.

He noted the game's ability to layer Pokémon characters on top of live images of the real world brings up the broader question of, "If you're going to do that with any particular preexisting character or image, have you created or secured the licensing rights to those?"

While this question is less of a concern with corporate-built games, it may be an issue if the technology takes off to the point where any amateur software developer can easily create similar augmented reality applications.

As an example, Mammen points to a game that layers the "famous picture of Albert Einstein where you see his white hair sticking up in all different directions," onto the live world. With such a picture, the "question then becomes, is it fair use for that augmented reality game, or does the creator of that game need to obtain some type of rights from the owner of that photograph?" he asked.

And the issue of fair use goes beyond whether or not such an application was offered for free or for profit. Attorneys need to account for many other factors including "whether it's a transformational use in some fashion or an educated use," Mammen added.

Perhaps even more complex, however, are IP rights in "fully immersive" virtual reality games "that maybe build off of existing images and existing copyrights, [where] any attempt to enforce that as a copyright might stretch some of the traditional notions of copyright," he said.

Whatever the situation though, Mammen sees the issues of fair use in the virtual and augmented reality space running into ambiguous territory, similar to that in the well-known case of Lenz v. Universal Music Corp. , which concerned whether a 20-second song by Prince imposed on a clip of a 13 month old dancing constituted copyright infringement.

2. Infringement Notification

Under the precedent set down in Lenz, copyright holders have to account for fair use before sending a takedown notice to a potential infringer.

Yet, even if such fair use consideration is made and unrealized, how such a takedown notice will work in the virtual and augmented reality space, especially if such technologies and content becomes as widespread as YouTube Videos and the like, is not yet entirely clear.

There are, however, some similarities between virtual and augmented reality and other media formats. While Mammen noted that there "is such a wide range of possibilities" for notifications, he also pointed out that some virtual reality platforms consist of a three-dimensional film real-world environments, and are therefore "analogous to film making."

As such, such content might be governed by the infrastructure put in place by the Digital Millennium Copyright Act (DMCA) "that involves various techniques for policing and serving takedown notices and trying to keep some reasonable limit on the massive volume on user generated content that's posted on platforms."

But while Mammen believes it is possible the virtual and augmented reality space will have similar notification procedures that "may even be the same ones [as the DMCA]," he cautioned "it may [also] evolve into slightly different that is more suited to the needs of the industry."

3. Future Patent Wars

Though virtual and augmented reality technologies have been around for a while, it is due to only recent advancements that they have become a force in the marketplace. In some regards then, the technology is only beginning to come into fruition.

Such a flourishing space is entirely not unlike the development of recent internet technologies that, while fueled by rapid innovation early on, were also the subject to exploitation by patent trolls looking to profit from new creations.

"What we saw, broadly speaking, over the last five years, was that a lot of the patents that were the basis for patent monetization entities or patent troll assertions were patents issued early in the internet age that were very broadly worded and had language that potentially covered a whole lot of technology space," Mammen said.

In the immediate future, however, Mammen sees "the owners of the fundamental inventions and the fundamental patents" in the virtual and augmented reality space "holding on pretty tightly to those." But the situation may change in the near future as the industry matures, he added, as "there may be increasing number of patents and a variety of patents that may for various reasons find their way onto the secondary market. And once that starts happening, that's when we may see some activity from patent monetization entities."

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