Vrishank Singhania

Legal and Regulatory Challenges of AVR technology

Image source: Yantram Studios

The ‘Fourth Industrial Revolution,’ as the current period is known, has been characterized by revolutionary innovations in the technology space ranging from Artifical Intelligence (AI) to Blockchain. One such innovation is Augmented Virtual Reality (AVR).

Virtual Reality (VR) involves the creation of a simulated environment that users can immerse themselves in. They can be used in 3D movies, video games or even for training people (in the form of flight simulators for example). Augmented Reality (AR) on the other hand enhances our experience of reality by adding virtual elements to the real world. It essentially overlays information from the internet on objects around us. Its applications can be found in various fields such as e-commerce, education, navigation, maintenance, gaming, and medicine.

AVR technology received a large amount of attention with the launch of Pokémon Go in 2016. The popularisation of such technology poses unique legal and regulatory challenges. This article will analyse AVR technology from the perspectives of privacy and data protection, product liability and intellectual property rights.

Privacy and Data Protection

The most prominent concern with almost all emerging technologies is that of data and privacy. This issue extends to AVR technology as well. They collect a vast variety of personal information of users. They can trace the exact location of a user, keep records of all surroundings that a camera has seen and access messages, emails, contacts and photos. They also have the ability to record biometric data such as fingerprints, facial patterns and eye retinas.

Data protection and privacy are even more important in AVR apps. Such data can be used by criminals, for example, to track, locate and identify individuals. They could also manipulate the application to lead a person to a particular area. For instance, in Guatemala, two people used the app location data to lure a teenager to a secluded place and murdered him.[1]

Unlike the US or EU, India does not have a specific piece of legislation on data protection. The Information Technology (Reasonable security practices and procedures and sensitive personal data or information) Rules, 2011 define personal data, biometric data and sensitive personal data. The IT Rules lay down that consent has to be obtained for data collection, adequate notice of the privacy policy should be given and data should only be collected for lawful and necessary purposes. Section 43A of the IT Act only provides a remedy against data controllers when it is proved that they have mishandled data and if there is a wrongful loss. Users trust the data that developers provide.[2] This is higher in AVR apps because the data is used to interact with the real world. Thus, the liability of app developers should be higher than in traditional apps. This is particularly important because data breaches in AVR apps can have very serious consequences as pointed out above.

Product Liability

There are many things that can go wrong with AVR technology apart from just simple bugs. They could pose health hazards and interfere with third party rights.

The potential of technology to cause health hazards is not new. The Wii by Nintendo, for example, caused several physical and mental injuries.[3] AVR is even more dangerous because users are immersed in a ‘new’ reality. It can cause ‘virtual reality sickness,’ epileptic seizures and nausea among other things. It would be the duty of the developer to ensure that fair warning is given to the users and to ensure that the precautions that are needed to be taken are explained. For example, in the Nintendo Wii, detailed precautions were listed before each game and warnings were also issued. In the absence of proper care by developers, the question that arises is whether they can be held for product liability.

Some argue that because AVR apps are ‘intangible,’ they would come outside the purview of ‘goods.’ However, it is not necessary for ‘goods’ to be tangible. The Supreme Court of India has given an expansive definition to ‘goods’ under the Sale of Goods Act and stated that under Indian law ‘goods’ could be either tangible or intangible.[4] It said that:

“A program would become goods provided it has the attributes thereof having regard to a) its utility; b) capable of being bought and sold; and c) capable of transmitted, transferred, delivered, stored and possessed. If a software…satisfies these attributes, the same would be goods.”[5]

An AVR app could satisfy these three conditions and thus, be considered ‘goods.’ Hence, developers cannot escape product liability.

The second challenge is interference with property rights. There were numerous instances in which users of Pokémon Go trespassed into private property while playing the game. The terms of services of Pokémon Go clearly lay down that players should take permission before entering private property and that the developers are not responsible for any trespass that users carry out. It is argued that the developers cannot be liable because the virtual objects are not actually on the property and thus it would not amount to trespass which requires material intrusion. However, the developers cannot dissolve themselves of their liability. Their software is responsible for placing virtual objects in private property which was the cause of the trespass in the first place.

The doctrine of attractive nuisance has been accepted in India.[6] It is an exception to the common law rule that the occupier of a land does not have any obligation to the trespasser. Under this doctrine, the occupier of a land can be held liable if he should have reasonably known that children would be attracted to certain objects on the land. This principle should be extended to AVR app developers. The placement of virtual objects on private property is what leads to the trespass and it is reasonably foreseeable that such an act would lead to trespass. Moreover, in the modern world, it would be necessary to recognize intangible rights. For example, in Riley v California, the Supreme Court compared the search of files stored in the cloud (intangible) to a search of a house. Thus, it is clear that the right to property can be extended to the intangible aspects as well.

AVR games also have the potential to instigate violence. Unlike an ordinary video game, the ‘experience’ of committing acts of violence is far more real in a VR game because of the immersive nature of the game. Claims against video games on the grounds of negligence for inducing violence have not been accepted by Courts because the consequences were not considered foreseeable.[7] However, such a position would become harder to take. VR games would require a user to physically perform the motions required. They do not just ‘inspire’ but in a way ‘train’ users to carry out such actions. From a policy perspective, the State would have to look into methods to control VR content so as to ensure that it is not opposed to national security and public policy.

Intellectual Property Rights

There are several intellectual property (IP) challenges that AVR technology poses relating to copyrights, trademarks and publicity rights.

Copyrights grant certain exclusive rights of reproduction and alteration. AR devices make it possible to alter our reality and thus could overlay information over copyrighted work. For example, some museums have started giving visitors AR headsets which transform pieces of sculpture or art and provide information. These could give rise to claims of copyright infringement. However, an argument could be made that these would come under the exception of ‘fair dealing’ as provided for under Section 52 of the Copyright Act, 1957.[8] The transformative doctrine was evolved in the US. It has been recognized by the Supreme Court of India which held that when a work is presented and treated differently, the subsequent work would be considered a new one.[9] The reproduction of a piece of art in virtual reality can also be allowed as per existing laws. The ‘freedom of panorama’ is a doctrine that has evolved in several common law countries. It permits photography, videography and creation of images of works of art that are publicly displayed in a permanent place. This doctrine finds statutory backing under Sec. 52(1)(s)[10] and (t)[11] of the Copyright Act, 1957.

Trademark infringements are another issue with AR/VR technology. For example, an AR headset shows that a bar of chocolate is labelled with B. However, it was actually labelled by A. Third parties have an interest in augmenting brands for their own benefits. Sec. 29 of the Trademarks Act, 1999 uses the phrase ‘in the course of trade.’ Thus, it may be argued that this provision could include a developer that is trying to augment brands in the virtual world so as to improve the user experience. However, it can be argued that since it is only in the virtual world, it doesn’t harm the trademark owner in the real world and as such there can exist no remedy. However, this is not necessarily true. In Adam Opel AG v. Autec[12], the plaintiff was a motor vehicle manufacturer and controlled the trademark ‘Opel.’ The defendant used ‘Opel’ on a toy car. It was held by the Court of Justice, that there was no trademark infringement in this case. As per Sec. 28, Trademarks Act, 1999, the trademark holder has the exclusive right only for the use of the trademark ‘in relation to the goods or services in respect of which the trademark is registered.’ There is a difference between a real, tangible object which can be sold and bought and a virtual, intangible object. This, however, does not imply that there could never be trademark infringements by AR/VR technology.

Virtual Reality involves the usage of avatars, which are essentially virtual lookalikes of people. Problems could arise if an avatar is made to look like a person (a celebrity for example) without their person. Every person has personality rights or publicity rights. This has been recognized by Courts in India. For example, in Shivaji Rao Gaikwad v. Varsha Productions,[13] the Madras High Court passed an injunction against a film ‘Main Hoon Rajnikanth’ as it did not have the requisite permission. In White v. Samsung Electronics America,[14] the defendant used a robot which had been dressed up to resemble Vanna White. Its commercial usage was considered a violation of White’s publicity rights. Thus, this principle can be extended to the realm of virtual reality as well.

Conclusion

It is clear that Augmented Virtual Reality technology has given rise to unique legal problems. There are concerns involving data and cybersecurity. This is particularly problematic in India because of a lack of a data protection framework. It could also involve harm to the users’ health and third parties and in such cases, the developer could be held responsible for product liability. There are also security and policy issues with respect to the content of AR-VR technology. The ‘intangible’ nature of objects could pose challenges for the enforcement of rights of holders of copyrights and trademarks. The argument regarding intangibility cannot be extended to publicity rights and virtual worlds will have to ensure that such rights are respected.

As with any other technology, there will be a discussion on the legal and regulatory approach that needs to be taken. Such discussions are often split between those who follow Frank Easterbook[15] on one side and those who follow Lawrence Lessig on the other.[16] While the former believed that new technology did not require new laws, the latter disagreed. However, the solution lies in adopting a middle ground. This article has shown that there exist legal issues, some of which can be addressed by existing laws and some which cannot. Hence, there would be a requirement to regulate those aspects of AR-VR technology that cannot be addressed by existing laws than to regulate the technology in its entirety.

References

[1] A. Griffin, Pokémon Go: Teenager Shot Dead While Hunting Creatures, Independent (July 20, 2016), available at https://www.independent.co.uk/life-style/gadgets-and-tech/news/Pokémon-go-death-guatemala-shot-danger-safety-dead-a7145836.html (Last visited on May 29, 2018).

[2] Sec. 43, Information Technology Act, 2000.

[3] S.A. Muller, Simulated Activity But Real Trauma: A Systematic Review on Nintendo Wii Injuries Based on a Case Report of an Acute Anterior Cruciate Ligament Rupture, 94(12), Medicine (Baltimore), 648, (2015).

[4] Tata Consultancy Services v. State of Andhra Pradesh, (2005) 1 SCC 308, at ¶37-38. [“TCS Ruling]

[5] TCS Ruling, (2005) 1 SCC 308, at ¶81.

[6] Radhey Shyam v. Govt. of N.C.T. of Delhi, 2007 SCC OnLine Del 1087.

[7] Sanders v. Acclaim Entertainment, 188 F. Supp. 2d 1264 (2002).

[8] Section 52, Copyright Act, 1957.

[9] R.G. Anand v. M/S Delux Films, (1978) 4 SCC 118.

[10] Section 52(1)(s), Copyright Act, 1957.

[11] Section 52(1)(t), Copyright Act, 1957.

[12] Adam Opel AG v. Autec, (C48/05) [2007] E.T.M.R. 33.

[13] Shivaji Rao Gaikwad v. Varsha Productions, 2015 SCC OnLine Mad 158.

[14] White v. Samsung Electronics America, 971 F.2d 1395 (9th Cir. 1992).

[15] F.H. Easterbrook, Cyberspace and the Law of the Horse, 1996(1) University of Chicago Legal Forum 207 (1996).

[16] L. Lessig, The Law of the Horse: What Cyberlaw Might Teach, 113(1), Harvard Law Review, 501 (1999).