If you are producing, minting or dropping non-fungible token products, investing in an NFT business or thinking about buying an NFT, you need an experienced NFT attorney and NFT law firm. Blockchain ensures uniqueness and singularity, but you need top-tier legal counsel for the other aspects of the asset. Call us here at Revision Legal at 231-714-0100. We are internet and NFT lawyers with proven experience with NFTs, IP protection, contract law, entity formation and complex IP litigation. Here are a few questions to ask as you embark on your NFT endeavor.
What Did You Produce/Mint, Sell, and Buy?
Maybe it seems easy enough to mint, sell and/or purchase an NFT. But, the exact legal nature of what was minted, sold and bought can be complicated depending, for example, on the terms and conditions of the sales contract and the selling platform and on underlying legal rights. Did you read the terms and conditions before buying? Did you read the disclaimers, warranties and other stated limitations on the web platform/NFT marketplaces? What did you actually purchase? For example, if you bought an NFT image, did you also purchase the copyright to the image? If so, was the copyright properly and legally assigned or otherwise transferred? Is/was the copyright registered?
These are legal questions that can be answered by NFT lawyers who excel at providing legal services related to blockchain, NFTs and crypto.
Did the Producer/Seller Have the IP Rights?
Along the same lines, another important legal question is whether the producer had the legal authority under U.S. and international copyright laws to produce the NTF. A similar problem might exist with other IP rights such as trademarks and the rights of individuals to their likeness and publicity. If you or your company are producing NTFs, have you done your proper due diligence with respect to trademarks and copyrights? If not, then you may be facing legal action for infringement. Understanding blockchain is not the same as understanding property and IP legal concepts.
Am I Minting/Offering “Securities?
Another legal issue on which you need advice and counsel concerns the question of whether you are minting/offering “securities” as defined and regulated by the federal Securities and Exchange Commission. Tokens and digital coins are increasingly deemed securities and there are a host of legal rules and regulations with regard to how such can be legally offered and sold. For example, securities must be registered before being offered or must come under one or more exceptions. Under some circumstances, even NFTs in the form of art and other digital objects can be considered “securities” if the buyer’s main expectation is to obtain profits that are “derived solely from the efforts of others.” This often depends on how the NFT is marketed.
What Else Should I Consider?
As mentioned above, what you are minting, offering and buying depends enormously on the various contracts involved including the terms and conditions of the sales platform and the purchase contract. These should be crafted and/or reviewed by lawyers with legal expertise in these matters and with deep knowledge of how blockchain technology and NFTs work. Further, all aspects of IP law should be considered when engaged in NFT minting. Examples include copyright issues, as discussed above, as well as:
- Trademark rights and potential infringements
- Infringement questions with respect to naming, websites and URLs
- Patent rights — such as design patent rights
- Royalty rights
- Licensing rights
- Rights with respect to publicity and likeness
- Marketing rules and regulations like unfair and deceptive business practices
- And more
Contact Revision Legal