Protecting NFTs and Cryptofinance Services as Trademarks – Trademark

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The EUIPO recently published new guidance on the classification of trademark applications for non-fungible tokens (NFTs). These tips are helpful because we see a lot of deposits in this area; however, further clarification may be required.

EUIPO guidance is available here. In summary, he states that:

  • Virtual goods fall under Class 9 because they are treated as digital content or images, but the term virtual goods itself lacks clarity and precision, so the content to which the virtual goods relate must be specified.

  • The 12e The Nice Classification Edition will incorporate the term “downloadable digital files authenticated by non-fungible tokens” into Class 9. The term NFT alone is not acceptable and the type of digital item authenticated by the NFT must be specified .

Comments on the guidance can be submitted until October 3, 2022, so there may be further developments thereafter. However, this approach provides welcome clarity for applicants and is also in line with the practice we have seen in other offices, such as the Swiss IPI. The UK IPO has yet to issue guidance on this issue, but we hope they will take a similar approach.

On the cryptofinance (class 36) side, the practice currently developing with European intellectual property offices and the WIPO is to accept terms such as “financial services relating to virtual (or digital) currencies”, rather than ” cryptocurrency services” or terms including the prefix “crypto -‘, which we believe has raised some specification objections.

One important jurisdiction that could prove difficult in this area is China: with its strict approach to classification, unless new categories are admitted into local “subclass” practice, it can be difficult to obtain adequate protection for NFTs and cryptofinance services.

At Keltie, we are seeing growing interest in filing trademark applications relating to NFTs and cryptofinance, particularly among clients in the art, sports and fashion industries.

In the US, more than 4,800 trademark applications for NFTs and related goods/services were filed in the first six months of this year, according to the US Trademark Attorney. Mike Kondoudis, which tracks NFT applications. It also identified over 3,100 US apps for digital or crypto currencies (and related services) and over 3,300 for the Metaverse and related virtual goods/services.

With such large volumes of requests, the risk of congestion is high, especially given the popularity and scope of Class 9. This will make it increasingly difficult to find permissions in Class 9 and lead to disputes which may in fact only be disputes on paper, but this would still prevent us from authorizing proposed new marks.

According to The Fashion Law blog, U.S. examiners recently opposed an intent-to-use application for MODAVERSE based on a likelihood of confusion with an existing registration for MODAVERS and an application for Meta Gala due to its similarity to Met Gala. In Europe, where IP offices do not review applications on relative grounds, third parties will need to be vigilant for similar applications.

In our view, there are two main challenges for IP offices arising from the rise of NFT applications.

First, in the short term, reviewers need to learn about NFT and cryptofinance terminology, so they can identify terms that are descriptive or lacking in distinctiveness. The evolving nature of this industry means that new technical terms are emerging and reviewers need to become familiar with them. We have noted the acceptance of some marks in this area which are very close to the line in terms of descriptiveness. Rigorous review based on knowledge of relevant new vocabulary from the NFT and cryptofinance industry will help ensure that protection is not given to terms that should be free for others to use.

Second, and in the longer term, the increase in NFTs will increase pressure on WIPO to review the Nice Classification and consider splitting Class 9. This class already covers a wide range of products and if products virtual are also registered here, as stated in the EUIPO guidelines, overcrowding in this class will increase – with all the problems this entails for search and clearance.

The content of this article is intended to provide a general guide on the subject. Specialist advice should be sought regarding your particular situation.

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