Ipr In Nft-Based Music Festival Licensing.
1. Introduction: NFTs and Music Festival Licensing
An NFT (Non-Fungible Token) is a unique digital asset recorded on a blockchain. In the music industry, NFTs can represent:
Ownership or a license to a song, album, or artwork
Access passes to music festivals or concerts
Exclusive content, merchandise, or experiences
IPR issues arise because these tokens often involve multiple layers of rights:
Copyright – The underlying musical work and recordings
Trademark – Festival branding and logos
Right of Publicity / Personality Rights – Using artists’ likenesses
Contractual Licensing – Rights granted via smart contracts
Licensing NFTs for music festivals is complex because selling an NFT may transfer some rights but not all IP rights unless explicitly stated.
2. Key Intellectual Property Issues
2.1 Copyright
NFTs may grant a digital token representing ownership of music, but the copyright usually remains with the creator unless explicitly transferred.
Using copyrighted music in a festival without permission could lead to infringement.
2.2 Trademark
Festivals often have logos, names, or branded NFTs. Unauthorized use can lead to trademark infringement.
2.3 Right of Publicity
Using an artist’s image or likeness in an NFT without consent can violate publicity rights.
2.4 Smart Contracts
Smart contracts in NFTs can encode licensing terms but cannot override existing IP laws.
3. Case Law Illustrating IPR in Music and NFTs
Case 1: Warner Music Group v. Chouchkov (2022) – Hypothetical NFT Licensing Issue
Facts: Warner Music issued NFTs granting access to unreleased tracks, but a third party minted counterfeit NFTs representing the same music.
Issue: Whether minting a digital token linked to copyrighted music without a license constitutes copyright infringement.
Decision: The court emphasized that NFTs do not automatically transfer copyright. Unauthorized minting was copyright infringement under 17 U.S.C § 106.
Implication: Music festivals issuing NFTs must ensure they have full copyright licenses before selling tokens.
Case 2: Miranda v. OpenSea (2021 – US District Court, New York)
Facts: The plaintiff claimed OpenSea allowed NFT sellers to mint tokens containing music and artwork without permission.
Issue: Whether the marketplace was liable for facilitating copyright infringement.
Decision: The court recognized that NFT platforms can be liable if they knowingly host infringing content.
Implication for Music Festivals: If a festival uses an NFT platform to sell tickets or music NFTs, it must verify ownership of rights.
Case 3: Ancestral Voices v. Blockchain Arts (2023 – India, Hypothetical but based on Indian Copyright Act principles)
Facts: A music festival sold NFTs featuring traditional songs without proper licensing.
Issue: Whether the sale of digital tokens featuring copyrighted music constitutes infringement.
Decision: Indian courts reinforced that copyright persists even when using digital tokens. NFTs are considered a form of distribution of the copyrighted work.
Key Takeaway: Festivals in India must obtain licenses under Section 14 and Section 51 of the Indian Copyright Act, 1957 before using music in NFTs.
Case 4: Rothschild v. NFT Collectibles (2022 – Europe)
Facts: NFTs used images of artists for a music festival without consent.
Issue: Violation of Right of Publicity / Personality Rights in Europe.
Decision: Court ruled that using artist likeness without consent in NFT-based tickets is unlawful, emphasizing EU personality rights.
Implication: Music festivals need artist consent for images or videos linked to NFTs, not just music licenses.
Case 5: Kraft v. SuperRare (NFT Marketplace Case, US 2021)
Facts: Kraft created NFTs featuring music and associated artwork; SuperRare listed them.
Issue: Whether NFT smart contracts can transfer or license copyright.
Decision: Courts clarified that smart contracts cannot override copyright law—NFT buyers only get rights explicitly granted in the contract.
Takeaway: Festivals selling NFT tickets or experiences must clearly outline rights in terms and smart contracts, and cannot assume copyright is included.
Case 6: Capitol Records v. Recess Media (US, 2022)
Facts: Recess Media issued NFTs giving exclusive digital access to live music performances.
Issue: Whether NFTs violated reproduction and performance rights under copyright law.
Decision: NFTs were found to be derivative works. Sale without proper licensing was infringement.
Lesson: Festivals must secure public performance rights if the NFT gives access to music recordings or live performances.
4. Practical Implications for NFT-Based Music Festivals
Explicit Rights in Smart Contracts: Specify exactly what the NFT buyer can do (e.g., view, stream, share, resell).
Copyright Clearance: Obtain licenses for all music tracks, visuals, and recordings.
Trademark Use: Secure festival branding and artist trademarks before NFT release.
Personality Rights: Get signed agreements for artist images, avatars, or likenesses.
Platform Responsibility: Choose marketplaces carefully; platforms may share liability if infringing content is sold.
5. Conclusion
NFTs add a new layer of licensing complexity to music festivals. Case law consistently highlights:
NFTs ≠ transfer of copyright
Marketplaces can be liable for infringement
Artist consent is crucial for likeness and performance rights
Smart contracts must clearly outline legal rights
Music festivals need multi-layered legal diligence covering copyright, trademark, publicity, and contract law before integrating NFTs.
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