Courtyard NFTs represent a digital version of assets we purchased and that are held in the custody of our security partner. This is similar to listing a photo of an IRL asset for sale on an e-commerce platform. We’ve worked with legal counsel to ensure that this does not infringe on IP rights.
As you might expect, NFTs present several unsettled questions of law, and there is always a risk that a brand owner might seek to enforce its rights in its trademarks, even against a use that is not infringing. Because the question of infringement is very subjective and fact intensive, reasonable minds can differ as to whether a particular use crosses the line.
That said, we have discussed the matter with counsel and believe that our specific platform, through which we are minting NFTs and offering them as no more than proof of ownership of a physical product that can be redeemed for the product at any time, does not infringe any brand owner’s rights. It is generally viewed as permissible to purchase collectables and re-sell them on a platform other than that of the original owner(s), including by using the brand name of products, provided it is not done in a misleading way or suggesting an affiliation with the brand owner that does not exist. We believe it is likewise permissible to mint and sell NFTs that are tied to the physical products purchased without infringing any brand owner’s rights.