By order issued on July 20th, 2022, the Court of Rome has granted an injunction against Blockeras S.r.l. (“Blockeras”) the creator of NFTs portraying images of a football player, reproducing without authorization the registered trademarks owned by Italian football team Juventus Football Club S.p.A. (“Juventus”). This is the first judgement issued by a European court to date, holding that unauthorized reproduction of third-party trademarks in the form of NFTs is tantamount to infringement.
Juventus is the holder of word trademarks JUVE and JUVENTUS, as well as a figurative trademark consisting of the signature black-and-white jersey with two stars.
In the course of its monitoring activities, Juventus ran into “Coin of Champion”, an NFT project launched in 2021 by blockchain-based platform Blockeras, the latter having minted, advertised, and offered for sale NFTs and other digital content depicting football players and including, inter alia, images representing said Juventus trademarks, as well as the image of former well-known Italian player Christian Vieri wearing his Juventus uniform.
The NFTs were sold via NFT marketplace Binance between April 7th and May 4th, 2022. Meanwhile, a secondary market took off where the cards could be resold, entitling the creators to additional income.
According to the evidence in the case file, 529 cards depicting former Juventus player were sold, 68 of which earned Blockeras $ 35.796,87 in revenue. Vieri has contractually licensed Blockeras to use his image until March 2024. Juventus, on the contrary, has given no prior authorization for the use of its own trademarks, consequently applying for a preliminary injunction on the grounds of trademark infringement and unfair competition.
The Court acknowledged, first, the trademarks relied upon as being well-known, due to the fact that Juventus is the Italian football team that has won the most, both in Italy and abroad. Against this background, the Court has found that Blockeras had used Juventus trademarks in commerce and had done so without due cause.
As to the defensive argument pursuant to which registration would not cover the goods in relation to which Blockeras had used the signs, the Court concluded that the registrations would also encompass goods in class 9 of the Nice Classification in relation to “digital downloadable publications”, in line with the fact that the aforementioned class is due to include “downloadable digital files authenticated by non-fungible tokens [NFTs]” under the 12th Edition of the Nice Classification, effective as of January 1st, 2023.
Furthermore, the Court noted that Juventus itself had proved having entered the world of cryptocurrencies and blockchain, including NFTs, yet being active in the crypto games' field (online games based on blockchain technologies and the use of cryptocurrencies and/or NFTs) via agreements with NFT fantasy football start-up Sorare SAS.
As to the authorized use of the player's image, the Court considered this did not exclude that Blockeras was also required to obtain Juventus's permission for the commercial use of its trademarks. In so doing, the Court has essentially affirmed that NFTs have legal autonomy as compared to the images or data associated thereto, therefore specifying that the injunction would concern both the digital content, including the player's image bearing Juventus' trademarks, and the NFTs themselves.
Moreover, the use of Juventus' trademarks may not be justified by the interest of publication of the player's image in light of his notoriety pursuant to Article 97 of the Italian Copyright Law, since the sale of the digital cards has only a commercial purpose and not a scientific or didactic one.
In light of the foregoing, the Court has issued a preliminary injunction against Blockeras:
(i) enjoining the “further production, marketing, promotion and offer for sale, directly and/or indirectly, in any way and form, of the NFTs (non-fungible tokens) and digital contents referred to in the motion for PI, as well as of any other NFTs (non-fungible token), digital contents or products in general bearing the image referred to in the motion for PI, even if modified, and/or the Juventus trademarks in suit, as well as the use of such trademarks in any form and manner”, and
(ii) ordering “the defendant to withdraw from the market and remove from every website and/or from every page of a website directly and/or indirectly controlled by the same on which such products are offered for sale and/or advertised, the NFTs (non-fungible tokens) and the digital contents associated therewith”.
The Order has now become final, as it was not appealed. However, the NFTs injuncted by the Court are still displayed on platforms such as OpenSea showcasing the player involved wearing Juventus shirt. Therefore, the question as to how such orders may be effectively enforced by brand owners still remains open, as NFT creators addressed by motions for delisting of infringing digital content hosted on their servers may allege to have no longer control over NFTs already sold.
Notwithstanding the foregoing, the raise in popularity and wide spread of NFT creations will soon allow for more litigation to raise, on a quest to solve this and other legal issues related to Non-Fungible tokens.
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