Virtual Property Issues: Hot Legal Item

Virtual property disputes and litigation have reportedly increased recently. Most of these cases involve patent issues, intellectual property rights, software and hardware infringement which are all considered to be virtual properties of some real-life companies.

A great deal of interest in virtual property issue was generated last year by a complaint filed by a Pennsylvania lawyer against an online virtual world operators (Bragg v. Linden Research Inc.) in which the federal district court found that in its terms of service, an arbitration clause has made it “unconscionable and therefore unenforceable”.

The attention focused by the media and the legal community on the case has reflected the growth of real-life litigation over virtual world property. With the growing participation of people in virtual worlds such as online role-playing games, real-life lawsuits had also been on the upsurge.

For example, online games where players interact and compete with other players by creating images (known as avatars) to represent themselves and by acquiring, selling or building property and even dating and having children, have become popular, attracting millions of people every day. A recent Google search for MMORPG, for instance, yielded approximately 32 million results.

Interestingly, numerous lawyers have also set up legal offices in virtual worlds, as have well-known retailers and other companies; even the Department of Homeland Security has considered establishing a presence there.

Some disputes over virtual world property probably can be resolved in the virtual world, based on the service or end-user license agreements and the rules establishing the virtual world. Indeed, one can imagine that a real-life lawyer with a presence in a virtual world might be asked to help a player resolve a property dispute with another player.

Additionally, real-life corporations may have to take steps to protect their property rights in virtual worlds to ensure that they are not used to the possible detriment of their real-life assets.