Nfts
INTA: NFTs should be protected as “goods” in the Bored Ape case | Trademarks
Registered association amicus brief to the Ninth Circuit in support of plaintiff Yuga Labs | The Lanham Act does not limit the definition of goods and services, INTA said.
Non-fungible tokens (NFTs) should be considered “property” under the Lanham Act, according to the International Brand Association (INTA), which said this approach would ensure brand protection on digital platforms, in line with the expectations of consumers and brand owners.
INTA presented its views yesterday in an amicus brief filed with the United States Court of Appeals for the Ninth Circuit regarding Yuga Lab’s accusations that two defendants made millions of dollars from to counterfeit versions of its “Bored Ape Yacht Club” NFTs.
In October 2023, a California federal judge ordered the accused to pay more than $1.5 million in damages for their copies of Yuga Labs’ NFTs, which they had called an art project intended to criticize the allegedly racist images of the Bored Apes tokens.
The lawsuit continued this year, with the California District Court in February imposing a $9 million fine on the defendants covering damages, fees and costs, and the defendants appealing.
Opposing Yuga Labs’ motion for summary judgment regarding its false appellation of origin claim, the defendants argued that NFTs were not eligible for trademark protection because they were goods intangible.
They said the U.S. Patent and Trademark Office had rejected several Yuga Labs trademark applications because NFTs are not commercial goods, and argued that the Supreme Court had required tangibility for the trademark protection in Dastar v. Twentieth Century Fox (2003).
“No definition limit” in the Lanham law
INTA urged the court to avoid an “excessive expansion of the narrow scope” of the Dastar case, which it said dealt with communicative content rather than communicative products.
The association argued that the Lanham Act refers to the registration and use of trademarks in connection with any good or service, without limiting the definition, which therefore includes NFTs.
The law focuses on consumer perception and what brands mean to consumers, INTA said, also highlighting the qualities that digital goods share with tangible goods, as noted by the district court.
“In summary, the district court correctly held that NFTs, if understood as digital goods comprising a set of tokens referencing the underlying digital assets via token metadata, are goods for the purposes of the Lanham Act,” INTA told the court.
She said this approach would maintain brand protection in new digital ecosystems in a way that would benefit consumers and brands.