The United States Patent and Trademark Office (“USPTO”) and the United States Copyright Office (“USCO”) delivered a report to Congress entitled Non-Fungible Tokens and Intellectual Property on March 12, 2024 (“Report”). While the Report is comprehensive, it does not recommend any new action to address IP issues with NFTs.Continue Reading The USPTO and USCO Delivered a Report to Congress on IP Issues with NFTs – Maintains Existing IP Regime
On December 13, 2023, CoinList Markets LLC (“CoinList”) agreed to pay $1,207,830 pursuant to a settlement agreement with the Office of Foreign Assets Controls (“OFAC”) in connection with allegations that the San Francisco based virtual currency exchange violated OFAC’s Russia/Ukraine sanctions by allowing users in Crimea, an embargoed country, to open accounts on its platform.Continue Reading Sanctions Enforcement in the Cryptocurrency Industry Continues to be a Focus
The U.S. authorities are increasingly taking actions against big-name crypto mixers for potential violations of sanctions regulations. On November 29, 2023, the U.S. Department of Treasury’s Office of Foreign Assets Control (“OFAC”) sanctioned Sinbad.io (“Sinbad”), which is a virtual currency mixer. As a result, U.S. persons are generally prohibited from dealings involving Sinbad or its property interests. Virtual currency mixers are anonymized software tools that allow users to conceal the source or owner of digital assets.Continue Reading OFAC Sanctions Crypto Mixer Following Allegations of Laundering Funds to North Korea
The USPTO has prepared soon to be published supplemental guidance for design patent examination for computer-generated electronic images. This guidance relates to determining whether a design patent claim including a computer-generated electronic image per se or a computer-generated electronic image shown on a display panel (e.g., computer screen, monitor, computer display system, mobile phone screen, virtual reality/augmented reality goggles), or a portion thereof, satisfies the article of manufacture requirement in 35 U.S.C. 171. This guidance supplements the guidance provided in section 1504.01(a), subsection (I) of the Manual of Patent Examining Procedure (MPEP). According to the USPTO, this supplemental guidance does not change the current guidance but provides important clarifications.Continue Reading USPTO Guidance on Design Patents Including a Computer-Generated Electronic Image
The USPTO has announced that the 1 millionth design patent was just issued. The USPTO grants design patents for new, original, and ornamental designs for an article of manufacture. Protecting the way something looks, as opposed to how it works (covered by a utility patent), is a vital step for many small businesses.Continue Reading Design Patents Milestone Announced
The SEC has, in rapid fire, announced enforcements against two NFT projects for allegedly violating securities laws. The first action announced August 28, 2023 was against Impact Theory and the second action announced September 13, 2023 was against Stoner Cats. In both cases, two SEC Commissioners dissented. The SEC has taken these actions despite not first offering specific guidance on the applicability of securities law to NFTs. While these actions have come as a surprise to many in the NFT industry, we have been cautioning NFT projects about these issues for some time. And in our NFT Regulatory Issues – a 2022 Review and 2023 Preview, we commented:Continue Reading SEC Enforcements Against NFTs – Are You Next?
The rapid growth of generative AI (GAI) has taken the world by storm. The uses of GAI are many as are the legal issues. If your employees are using GAI, they may be subjecting your company to many unwanted and potentially unnecessary legal issues. Some companies are just saying no to employee use of AI. That is reminiscent of how some companies “managed” open source software use by employees years ago. Banning use of valuable technology is a “safer” approach, but prevents a company from obtaining the many benefits of that technology. For many of the GAI-related legal issues, there are ways to manage the legal risks by developing a thoughtful policy on employee use of GAI.Continue Reading Microsoft to Indemnity Users of Copilot AI Software – Leveraging Indemnity to Help Manage Generative AI Legal Risk
On August 28, 2023, the Securities and Exchange Commission (“SEC”) instituted cease-and-desist proceedings under Section 8A of the Securities Act against Impact Theory, a Los Angeles media and entertainment company, alleging that the company’s sale of non-fungible tokens (“NFTs”) violated the registration requirements under the Securities Act of 1933 (the “Act”). Continue Reading The SEC’s Sudden Impact on NFTs!
AI-based code generators are a powerful application of generative AI. These tools leverage AI to assist code developers by using AI models to auto-complete or suggest code based on developer inputs or tests. These tools raise at least three types of potential legal issues:Continue Reading Solving Open Source Problems with AI Code Generators – Legal Issues and Solutions
Valve has reportedly adopted a policy to reject games that use AI-generated content over infringement concerns. A developer posted on the “aigamedev” subreddit that in response to submitting a game with some assets that were obviously AI-generated, he received a rejection notice from Valve stating:Continue Reading Valve Rejects Games with AI Assets Over Copyright Concerns