The Delhi High Court recently discussed the relationship between generative AI and personality rights in Digital Collectibles Pte. Ltd. and Ors. vs. Galactus Funware Technology Private Limited and Anr. [CS (COMM) 108/2023]. In this case, the court declined to issue an interim injunction against gaming platforms Mobile Premier League (MPL) and Striker for using the name and likeness of certain cricketers to create Non-Fungible Token (NFT) – enabled “Digital Player Cards”.
Non-fungible tokens under copyright law
NFTs are distinct digital assets that leverage blockchain technology to validate ownership and are often used to trade digital art and collectibles. Nevertheless, an ongoing discussion revolves around the intellectual property rights associated with NFTs and the question of whether acquiring an NFT confers copyright ownership.
On the other hand, Online Fantasy Sports (OFS) involves participants creating virtual teams with real athletes and competing based on their performance in real sporting events. Users pay an entry fee to join and use their skills to participate in online events or leagues. Under current copyright laws, the purchase of an NFT does not automatically confer the legal right to claim copyright in the artwork unless a separate commercial agreement has been established to that effect. At that moment, an OFS platform created NFT-enabled “Digital Player Cards” (DPCs) bearing the names and likenesses of certain cricketers. These digital assets can be owned and traded by users on the blockchain.
Case overview
Digital Collectibles Pte. Ltd. (plaintiff no. 1 herein) owns and operates ‘Rario’, a platform for digital collectibles based on NFTs. The platform facilitates the sale, purchase and trading of officially licensed DPCs with cricketers. As well-known cricketers, plaintiff no.2 to 6 granted plaintiff no.1 an exclusive license to use their names and photographs on the Rario platform.
These DPCs contain names, photographs and other personality traits of cricketers that are bought, sold and traded for actual currency on Rario, using Rario’s private blockchain. The price of each DPC is determined by the demand and supply for that specific DPC, which in turn is influenced by the popularity and reputation of the respective cricketers.
Galactus Funware Technology Private Limited (Defendant No. 1) is the proprietor and operator of the online fantasy sports platform called MPL, while Defendant No. 2 is the proprietor and operator of the mobile application ‘Striker’, listed on MPL. Like Rario, Striker users can buy, sell and trade DPCs, and Striker also uses NFT technology to authenticate the DPCs on the platform.
In February 2023, a suit was filed in the Delhi High Court against the defendants for using the players’ names, images and other attributes (including those of plaintiff nos. 2 to 6) on their platforms without obtaining the players’ authorization or license.
Right to publicity in relation to freedom of speech and expression
The plaintiffs argued that the value of the DPCs, considered as digital art collectibles, is primarily derived from and dependent on the names, likenesses and other elements associated with the cricketers whose DPCs are offered on the Striker platform. Moreover, they relied on precedents laid down by the Hon’ble High Court of Delhi i DM Entertainment Pvt Ltd v Baby Gift House & Ors [MANU/DE/2043/2010] and Titan Industries v M/s Ram Kumar Jewellers [(2012) 50 PTC 486]to claim that the Striker DPCs are an unauthorized endorsement and violated the plaintiffs’ publicity rights.
In response to the plaintiffs’ claim, the court noted that while Indian courts have recognized the existence of celebrity personality rights, these rights are not absolute and must be weighed within the framework of the common law principle of “passage” and in accordance with the right to freedom of expression enshrined in Article 19(1 )(a) of the Indian Constitution.
The single bench of Justice Amit Bansal held that the right of publicity was subordinate to the freedom of speech and expression guaranteed in the Constitution and noted that the “right of publicity”, i.e. the right to control the commercial use of one’s identity and personality, is not absolute or unlimited.
The celebrity’s right of publicity is only infringed when the use of their name or image is intended to mislead the public into believing that they endorse and associate with the product in question. In such cases, it can be said that the celebrity’s goodwill and reputation have been misused to market a product or service.
Use of artwork with creative elements
The court highlighted that the DPCs of the defendants include artwork of the players, not photographs, and this artwork was determined to have creative elements that distinguish them from the actual images of the players since the defendants have expressed themselves through these creations rather than using celebrities directly. These innovative features and creative caricatures were held to be protected under Article 19(1)(a) of the Constitution.
Player information available in public domain
The defendants expressed that the content used for DPCs on the Striker platform is in the public domain, which served the purpose of identifying the cricketers on the platform; thus it is beyond the scope of these cricketers’ personality rights. It was further stated that the platform is categorized as an OFS game, which does not offer the ability to purchase and “own” cricket moments (a key feature of the plaintiffs’ licensed DPCs). The defendants argued that their DPCs could not be traded or used outside of the Striker platform, as they are inherently tied to the user experience and format of the Striker platform, and highlighted that the use of players’ names and other information in a similar manner is common in other OFS – game, which shows an established industry practice.
The defendants also cited the decision of US courts in CBC Distrib. & Mktg. v Major League Baseball Advanced [505 F. 3d 959] and Daniels v. Fan Duel Inc [109 N.E. 3d 390]to support their argument that if the information and facts about certain celebrities that the defendants use are already publicly available, there can be no valid claim of infringement of publicity rights.
The court noted that OFS operators use publicly available player names and images to identify players. Thus, the court ruled that no one can own information in the public domain, and such information cannot be monopolized or licensed. Since facts in the public domain cannot be monopolized, a third party’s use or publication for commercial gain cannot give plaintiffs a cause of action. Regarding the remedies available to an aggrieved celebrity, the court cited only defamation as a remedy.
Accordingly, the Hon’ble Court held that the plaintiffs failed to make out a case for the grant of an interim injunction[1] and effectively gave Striker the go-ahead as it is not a “trading platform” like Rario per se and does not mislead customers as to its affiliation or endorsement and does not infringe any Digital Collectibles rights. Based on this, the case is listed for proceedings on 10 July 2023.
Order of Single Judge Bench Challenged
Indian cricketers including Mohammed Siraj, Harshal Patel and Rario have challenged the above interim order of the Single Judge Bench through appeals filed in the Division Bench of the Delhi High Court. The appellants emphasize the absolute rights of the players over their personhood and argued that there is a misunderstanding about when fair use ends and confidentiality begins. The bench has instructed the parties to submit written statements within a week and scheduled the next hearing for 10 July 2023.
Analysis
In the above case, the Delhi High Court has recognized that the test for determining infringement of the right of publicity is consistent with the principles and standards of tort. It is now clear that the right of publicity is violated when a third party uses a celebrity’s information, characteristics or characteristics in a way likely to cause confusion.
The recent appeal against the order of the Single Judge Bench is a testament to the strain celebrities face when Online Fantasy Sports platforms use their images to lure audiences. The position of the Honorable Court has not yet been determined; However, the mere incidental or transformative use of a celebrity’s name, image, etc. in connection with a product or service cannot be said to be an infringement of the right of publicity. This order has brought precision to Indian jurisprudence on the right to publicity, while emphasizing the need to strike a balance between fair enforcement of the right to publicity and upholding the constitutional right to freedom of speech and expression.
Additionally, the court’s decision has the potential to influence the approach of Indian courts in addressing the incorporation of new and advanced technologies in our daily lives. As this field of law is still evolving, it remains to be seen whether the Indian judiciary will embrace this trend of engaging with new concepts.
