What is the metaverse and what types of disputes will arise from it?

Part 1 of our Disputes in the Metaverse insight piece looked at how the Metaverse can be defined and the types of disputes that will likely arise within the Metaverse. In summary, there seems to be consensus that it comprises a series of large-scale immersive, interconnected virtual spaces – allowing rich interaction via cutting-edge technologies, such as artificial intelligence, blockchain, real-time 3D engines, and augmented, extended, and virtual reality, allowing physical-virtual interactions. Disputes arising within the Metaverse will depend on the nature of the technologies used but will include financial claims, intellectual property disputes and other areas such as defamation, hate speech and harassment and personal data.

Where will disputes be resolved? 

Disputes arising from virtual worlds still materialise as real-world claims in physical courtrooms.  But traditional courts may prove ill-suited to metaverse disputes, although it may be possible to adjust traditional tools to Metaverse realities.

It is likely that the future will hold a combination of traditional and virtual dispute resolution methods.  These may include resolution by the platforms, outsourced dispute resolution, and decentralised arbitration courts.  Aragon already handles disputes that cannot be solved by smart contracts, drafting in “guardians” who review arguments for each dispute and vote to rule the way they expect the plurality of guardians will rule.

Kleros uses a smart contract to automatically draw a defined number of jurors and voting with the majority wins you cryptocurrency.  In part, the success of these model may depend on users’ willingness to participate in solving other users’ disputes.  We may see a shift from individual decision-making to technological processes.  Speed and ease of enforcement facilitated by the different methods may determine take up.  Novel enforcement challenges will arise.

How can you avoid or minimise these disputes?

Given the different ways in which the Metaverse may develop, what are the key ways you can protect yourself against disputes?

Check your business is Metaverse ready.  Are your contracts, licence, agreements, and terms and conditions fit for your developing interests?  Have you assessed risks around cybersecurity and data protection?  Do you have a roadmap for virtual property rights?

Likewise, you need to review the protections afforded by your current brand and IP portfolio.  Identify vulnerabilities in your protection.  Consider:

• Do you need new brands/branding elements? 
• Do you have word and figurative trade marks for physical goods/their digital equivalents? Do you have necessary patents?  Do you have unregistered rights you need to protect?
• Do your protections operate across jurisdictions in the Metaverse?
• Are you using your registered rights? Can you let some lapse, freeing up budget for other filings? 
• Are there any third-party rights that could scupper your expansion plans? 

Finally, hire trusted legal advisers who understand the challenges you may face, who can help you anticipate potential areas for conflict.