Why does intellectual property matter?

If you’re a content creator or a marketer, you’ve probably either had a close call or tripped up over intellectual property and copyright rules. Conundrums can arise for example with the use of third-party content, such as image and video materials that are purchased online. We sat down with Nora Haapala, an attorney and associate partner at Rödl & Partner Asianajotoimisto Oy, to discuss.

Let's start with the basics: what is the difference between intellectual property and copyright?

Although both terms are often used interchangeably, intellectual property refers in general to any type of creation or invention. Copyright is one type of law that protects some parts of intellectual property. Copyright simply gives the owner of certain content, such as text, music or sound recordings, control over how the material will be used.

In other words – intellectual property is an umbrella term describing two main types of intangible assets: copyright and industrial property rights, such as patents or trademarks.

To make a complex issue simpler, the World Intellectual Property Organisation came up with a list of examples of intellectual property (IP), based on James Bond films. It's an excellent way of explaining the differences between types of intellectual property! For instance, all of James Bond's secret weapons invented by Q would qualify for patent protection, James Bond movies and music receive copyright protection and the look and feel of Bond's gadgets can be registered as designs.

As content marketers, we know how important it is that everyone is paid for their creations and that all parties involved agree on how the content will be used. What are the risks of not being aware of IP?

When content is created, the parties involved (creators, companies, content marketing agencies) need to ensure that they have all the necessary rights to use the content. Depending on the type of IP, this can be obtained with a transfer agreement (the owner transfers/sells the rights) or more commonly, doing a licensing agreement (allowing one party to use the property of the owner eg. against a royalty payment). Using IP without the owner's permission can result in an obligation to pay monetary damages (including loss of profit) or even criminal consequences.

Got it! How should content agencies and corporations, or maybe even social media content creators, protect their intellectual property?

In French cuisine, the three magical words are butter, butter, butter. With IP protection, the three magical words, in my opinion, are strategy, registration, and utilisation. Protect your IP by registering and creating confidentiality, non-disclosure or licensing contracts with your employees and business partners. Moreover, implement security measures regarding storing and distributing your IP. And if possible, try to avoid joint partnership. In this type of agreement, a joint decision is required by all parties for practically any or all disposal of intellectual property rights.

That makes sense. Now, let's change gears a bit. The power of a meme lies in the fact that it's an easily recognizable, existing image or photo, and NFTs are another chapter entirely. How do IP and copyright rules apply to content formats such as memes?

The most burning question in this context is: do memes violate copyright? If focusing on the content where no permission of the author was given, the defense to a claim of copyright infringement is so-called fair use. European law as it stands does not define fair use, but courts measure fair use mainly by the purpose of using the content (criticism, reporting, teaching, parody, caricature or satire) and the portion used concerning the copyrighted work as a whole. The main rule to remember here is that it should be used only for nonprofit purposes.

According to Forbes magazine, the trade volume of NFTs was around 25 billion euros US dollars last year. Do existing copyright rules apply to this class of assets?

NFT is a digital certificate of ownership representing the purchase of a digital asset traceable on the blockchain. Buyers of NFTs are simply buying the metadata associated with the work, not the (art)work itself. In many ways, buying an NFT is more like buying a limited-edition poster or a signed copy of a book. It is special and (more) unique, but it doesn’t mean that the original work is now yours. Therefore, buying and selling an NFT does not, in principle, constitute a transfer of copyright or other intangible rights.

In some instances, though, the seller may offer to turn the token into an actual transfer of the copyright ownership of the original work. However, it is difficult to assess if this is compliant with the legal formalities needed to transfer copyright.