Non-Fungible Tokens (NFTs) are unique non-interchangeable units of data (i.e., “tokens”) minted through a digital ledger (e.g., blockchain) to validate ownership and authenticity of a digital asset. In simpler terms, NFTs can be thought of as an original artist’s signature on the back of a painting but in digital form for a digital artwork. Businesses are looking for ways to monetize their intellectual property rights through NFTs. However, NFTs present challenges concerning ownership as well as various copyright and trademark infringement problems depending on the digital asset being authenticated.

Takeaways from Miramax LLC v. Tarantino

In a recently settled case, Miramax LLC v. Tarantino, Tarantino wanted to auction away seven NFTs providing images of original handwritten scripts of never-before-seen scenes of his popular movie, Pulp Fiction. However, the film’s producer, Miramax, claimed to have rights to these NFTs. At the center of this case was an IP agreement signed between both parties in the 1990s prior to production. In this agreement, Miramax was granted rights to the film’s trademarks, while Tarantino was granted rights to screenplay publications. It is unclear if Tarantino’s IP rights extend to these NFTs.

Although the parties recently settled outside of court, the case provides insight on the intersection between NFTs and IP. The following should be considered as you manage your IP:

• IP Agreements: When buying, selling, designating, or transferring ownership of IP, understand the agreement that you sign. Consider adding a section that clarifies which party has the rights to any NFTs and what those NFTs may include.
• Trademark Applications: To protect existing rights, consider applying to register your trademark(s) in connection with NFTs. As always, take care in identifying the NFT-related goods and/or services. The US Patent and Trademark Office (USPTO) has provided some guidance by adding NFT-related terms in various classes (e.g., classes 9, 35, 36, 42).

As always, staying up to date on court decisions and any guidance provided by the USPTO, US Copyright Office, or the like is imperative to understanding your rights in the dynamically evolving NFT space.