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Sex has always shaped law in cyberspace, and now a lawsuit over imaginary sexual encounters in Second Life, the popular virtual world, could write some bold new rules for the treatment of intellectual property online.

Since the dawn of the internet era, pornography has pushed the frontiers of online legality. Many of the first internet copyright and trademark cases involved Playboy, or other purveyors of adult entertainment online. They made law for everyone involved in electronic commerce, including the big media companies and retailers online.

But the Playboy lawsuits involved real people or real companies suing one another in a real world court. The Second Life sex suit is different: it involves two imaginary online characters, or “avatars”, suing one another for something that takes place entirely in a fantasy world.

An avatar called “Stroker Serpentine” is claiming that “Volkov Catteneo” (another imaginary personality) has infringed his copyrights and trademarks by faking software that allows one avatar to have sex with another.

Second Life is part of the “3D internet”. In this improbably popular phenomenon, virtual reality websites allow everything from holding boring old office meetings online (IBM does that) to advertising (many big brands do that) to living out wild, impossible (and potentially illegal) fantasies involving sex, gambling, war or even rape.

Second Life claims to have 8.5m “residents” – people who have created avatars. Fewer than half a million log in during a normal week, but some of those have built a fantasy universe of virtual businesses, property and families online. And, more importantly, their assets are traded offline for hard cash. More than $1m in real world dollars are spent on Second Life assets every day.

The sex suit is not just a bit of cheap titillation: it tests the application of real world copyright and trademark laws in ways that could have big implications for everyone who trades online.

Brent Britton, an expert on real world rights online, says the case raises a new issue. “The novel question is: Can you infringe a trademark or copyright that exists purely in the virtual world? The answer has to be Yes,” says Mr Britton, an attorney at the law firm Squire Sanders & Dempsey in Florida.

The case involves a former plumbing contractor, Kevin Alderman (Stroker Serpentine), and an anonymous avatar who has (allegedly) been selling illegal copies of his popular cyber sex toys on Second Life. Mr Alderman had trouble even discovering the identity of his rival, because most Second Life avatars do not use their real names.

He asked the real world courts to step in and force Linden Lab (which operates Second Life) or Paypal (the online payment company) to pierce the veil of anonymity and reveal the terrestrial identity of Volkov Catteneo. The court clearly felt that living a secret life in the virtual world is one thing, but breaking the law is another. It authorised subpoenas to discover Volkov Catteneo’s identity.

The court may yet take the obvious position that virtual sex is inherently valueless so there is no case to answer – but that would be a mistake.

“This case is about the extent to which real world law applies in virtual reality,” Mr Britton says. “I think it does and it should.”

Things that take place in Second Life, he adds, are not “qualitatively or quantitatively different” from what takes place in the real world – “they just happen to be mediated by a computer”.

Benjamin Duranske, founder of the Second Life Bar Association, agrees. “There’s definitely an argument that these things don’t have any value in the first place,” he says. “I don’t buy that.”

Companies such as Nike, Apple and Ferrari have a big presence in the virtual world, sometimes without even knowing it, Mr Duranske says. “The next big legal issue is trademark infringement in the virtual world.”

And so it should be. Second Life is just like real life, online. Avatars can fly, cavort and escape the power of natural laws. But when it comes to violating the basic legal contracts of a civilised society – such as those against rape, gambling or copyright infringement – virtual personas are subject to the law, just like the rest of us.


Copyright The Financial Times Limited 2018. All rights reserved.

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