(Obnoxious but necessary caveats: I’m simplifying this a lot, which means I’m leaving a lot out…and it’s still insanely long. If you’re a trademark lawyer, sorry: I know I’ve left out some important bits. Also: this is intended to be a general overview, not legal advice.)
Let’s sit down a moment and try to get a grasp on why trademark law works the way it works. So many of us are familiar with good old copyright law, which seems so easy and straightforward (protip: it isn’t, but it’s good at pretending). On first approach, we expect trademark law to be the same: basically just copyright law with a business suit on.
It isn’t. Trademark law has a completely different goal and intent. Let me lay out the basics in a handy comparison chart, and then I’ll get to the hard stuff.
Readers Digest Version: Trademark law isn’t like copyright law. Copyright law protects the creator / owner. Trademark law protects the consumer / buyer. When trying to decide if something infringes or not, copyright asks, “Oh, is it similar to John Doe’s work?”. Trademark asks, “Would consumers think that this product comes from that source?”.
Okay, so that’s the easy part. Now we have to look at the really difficult part – the stuff that always throws people about trademarks.
When you create a work of authorship, like a painting, that work is covered. Full stop. It doesn’t matter what state you live in. It doesn’t matter whether you’re using that painting for your awesome lolcat website or for your grandmother’s birthday present. It’s covered.
When you create a brand name, a logo, a symbol, or any other mark, it matters how and where you choose to use that mark. If I create the “WhoaToes” brand of fuzzy socks and I am the first person to sell fuzzy socks under the name “WhoaToes,” I will immediately have a trademark for “WhoaToes” in my geographical area. I can register “WhoaToes” with the Trademark Office, and then I will have the right to use the mark nationwide. So that’s the where part.
The how part is more confusing. When I register my trademark, I have to indicate what kind of goods I intend to protect. I’m selling fuzzy socks. This means that when I register my trademark, I can register “WhoaToes” in clothing, and I can keep people from using that mark for clothing. So I could stop someone from making some awesome “WhoaToes” sweaters. However, if I’ve only claimed my mark in the clothing class of goods, I can’t stop someone from making “WhoaToes” potatoes or “WhoaToes” toys. I also can’t prevent non-commercial uses…
…Except (you had to know there would be an except). I can prevent certain uses that harm the distinctiveness or the reputation of my brand. If my brand is famous, I get some extra protections on it: once practically everybody knows what WhoaToes is, I can stop people from making products in different classes. Basically, I can stop other people from cashing in on my famous mark, because if I don’t, then consumers won’t be able to tell what goods are really endorsed by WhoaToes and what goods are just some random person trying to ride my fuzzy WhoaToes coattails. After a while, consumers might just stop trusting the WhoaToes name, and that would be bad.
Things get super, super-confusing when you add a virtual world into the mix. In SL, when people purchase fuzzy socks, they are not actually clothing. No one would reasonably be confused that virtual fuzzy socks are actually going to warm your feet. However, many real life companies have come into SL and established presences there, creating and selling branded items. So if someone sold WhoaToes fuzzy socks in SL without my permission, would that infringe my trademark? The law is still unsettled, and pretty confusing. There have been cases of real-world companies suing video game creators for trademark infringement: a strip club sued Rockstar Games for reproducing its club and logo in Grand Theft Auto: San Andreas; Marvel sued City of Heroes for allowing players to reproduce trademarked comic book heroes; and even TASER sued Second Life for permitting the sale of trademarked TASER guns. There is also licensing: back in 2008, to stop infringement, Herman Miller hired a production company to create authorized Aeron chairs in Second Life, which it both sold and offered as trade to people who destroyed their infringing knock-offs. But ultimately, it remains unsettled as to whether or not the knock-offs were actually infringing as a matter of law.
Is it a risk worth taking? As risks go, this one isn’t my favorite. There are certainly better approaches to business than trading in on someone else’s famous brand. You’re in violation of the Terms of Service, which means you’re on shaky ground with LL. And if you want to fight for the cause of virtual exceptionalism just for the sake of the precedent, more power to you…but it’s going to be an expensive fight. Also, trust me, nobody wants virtual WhoaToes knockoffs.