The NFT marketplace OpenSea was the target of trademark complaints from the Recording Industry Association of America (RIAA), which led to the removal of some infringing tokens from the market.
OpenSea removes NFTs
The NFT market OpenSea has had a challenging week. In a letter, the RIAA asserts that many Ethereum Name Service (ENS) domains available on OpenSea’s market contain references to the recording industry group and its members. The non-fungible token market at OpenSea has had the offending ENS domain names removed.
Selling the infringing domain names, according to the RIAA, causes “dilution, confusion, and tarnishment” of trademarks. Furthermore, it is illegal to sell such names due to cybersquatting, common law publicity rights, and unfair business practices. The letter cites 89 domain names, including Universal Music Group, Atlantic Records, Capitol Records, Warner Music Group, Parlophone Records, and Virgin Records.
OpenSea prepares for a downturn
Immediately following OpenSea’s announcement that it would cut its workforce by 20% due to market limits, today’s news was made public. The company has to prepare for a potential “prolonged downturn,” according to CEO and co-founder Devin Finzer, who wrote about it in a blog post on July 14. He cited the “historic mix of crypto winter and greater macroeconomic uncertainty.”
The general situation of the crypto market has caused a dramatic decline in the NFT value marking this summer. Given the dramatic market drop, the RIAA’s charges are unlikely to hurt OpenSea on their own. But trade volumes will likely be impacted by the possibility of legal action and the obligation to delist coins.
It is nothing unusual for things to be taken out of the marketplace. Prior to that, it delisted ENS domains connected to Calvin Klein. A clothing line named Not Okay Bears that imitated Okay Bears from another NFT line was also delisted.
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