{"id":1994,"date":"2022-05-03T15:31:15","date_gmt":"2022-05-03T15:31:15","guid":{"rendered":"https:\/\/blogs.luc.edu\/ipbytes\/?p=1994"},"modified":"2024-07-13T06:41:57","modified_gmt":"2024-07-13T06:41:57","slug":"jodorowskys-dune-how-understanding-copyright-can-save-you-3-million","status":"publish","type":"post","link":"https:\/\/blogs.luc.edu\/ipbytes\/jodorowskys-dune-how-understanding-copyright-can-save-you-3-million\/","title":{"rendered":"Jodorowsky\u2019s Dune – How Understanding Copyright Can Save You $3 Million"},"content":{"rendered":"

Recently, the concept of NFTs<\/a>, or Non-Fungible Tokens, have taken over the internet as the new, hot investment<\/a>. Unfortunately, so too have people\u2019s misconceptions about what owning an NFT actually is. Many investors think that owning an NFT of a digital image means owning the underlying copyright to the image. Spoiler alert<\/em> \u2013 it doesn\u2019t.<\/p>\n

<\/p>\n

The quintessential example of this is when investors bought<\/a> a copy of the book, Dune (yes, that<\/em><\/a> Dune<\/a>) for about $3 million thinking they would then hold the copyright for the story. Sadly, that\u2019s not quite how copyright works.<\/p>\n

Whether you are hoping to invest in NFTs, are a casual fan, or plan on becoming an attorney, it\u2019s important to know just what the law protects. This is especially true with emerging technology and trends such as NFTs. So let\u2019s take a look at what NFTs are and how copyright protects them. Let\u2019s use the the infamous Dune investment as an example, so you can learn what you can do to avoid making the same mistakes.<\/p>\n

NFTs \u2013 What Are They?<\/u><\/p>\n

\"\"Before we understand copyright protection regarding NFTs, it\u2019s important to understand just what an NFT is<\/a>. NFTs come in a variety of digital forms such as a still image or video. Essentially, NFTs are unique, one-of-a-kind digital files that can be traded and purchased using cryptocurrency like Bitcoin. The sale or exchange is done through the cryptocurrency markets, or blockchain, where it tracks who owns the original files. Think of it like a piece of art, except in a digital file. No one else has the original work of art, but they can have reproductions of it (like art prints).<\/p>\n

NFTs can be worth a lot. For example, an image of the internet meme \u201cDoge<\/a>\u201d sold for $4 million. The musician Grimes sold several images and videos depicting War Nymphs<\/a> for $6 million recently.<\/p>\n

What is a Copyright?<\/u><\/p>\n

Now that we know what an NFT is, how does copyright come into all this? Copyright<\/a> is legal protection granted to creative works. This includes things like literature, art, computer code, music, etc. The work must be original to the author and not made by someone else. Next, there needs to be minimal creativity, but this is a low standard that can even be met by selecting or arranging information<\/a> in an original way. Then, as long as the work is in a tangible form \u2013 like a physical document or a digital file, and not barred from protection by a statute, then it has protection<\/a> under US coypright law.<\/p>\n

A copyright owner generally has rights to exclude<\/a> others from a variety of things, such as copying the work, or making other work based on it, which are considered \u201cderivative works.\u201d The copyright owner also has the right to transfer<\/a> the copyright to another or allow specific individuals to use the work through licensing<\/a>. The licenses can be for specific situations, such as playing the song in my store or including it in a video game.<\/p>\n

However, purchasing a copyrighted work does not grant the buyer ownership of the underlying copyright. They simply own that specific work. If a purchaser wants to own the underlying copyright protections to the work, they need to come to a separate agreement with the creator that transfers the rights to the copyright.<\/p>\n

For example, if I purchase a Billy Joel CD (which is copyrighted), I get a physical copy of the music that I can listen to all day long. What I don\u2019t get is the ability to use a song from the CD in my independent movie, because that would violate the copyright owner\u2019s (Billy Joel) right to make a work with his copyrighted music. That\u2019s a right reserved to the copyright owner, Billy Joel. If I wanted to use that song for my movie, I would need to get permission from Billy Joel through a license or purchase the copyright altogether.<\/p>\n

The Multi-Million Dollar Mistake<\/u><\/p>\n

\"\"That brings us to the infamous Jodorowsky Dune incident. The group Spice DAO bought a copy of Frank Herbert\u2019s Dune<\/a>. This specific book was rare because it featured illustrations by filmmaker Alejandro Jodorowsky from when he unsuccessfully tried to adapt the book to film<\/a>. Because of that, it was worth a lot of money \u2013 projected to be worth around 25,000 euros approximately.<\/p>\n

However, Spice DAO blew that projection out of the water by spending about $3 million<\/a> to purchase the book. Right after they bought the book, they infamously tweeted<\/a> that they would make NFTs out of the book, make the book public, produce animation based on the book, and create community inspired \u201cderivative works\u201d, i.e. things based on the original book they just purchased.<\/p>\n

Their declaration was met by a lot of scorn<\/a> and mockery<\/a>. This is because the investors had no right to do any of the actions above. They hadn\u2019t purchased a copyright, they had simply purchased a book. Much like my example with the CD, Spice DAO would have had to enter into an agreement with the copyright holder to have the right to preform these actions, like a entering lisencing agreement with the owner that outlined their intentions with the Dune work.<\/p>\n

Any competent attorney could have warmed them of this fact, had they bothered to consult one.<\/p>\n

What Should You Know<\/u><\/p>\n

It\u2019s easy to mock Spice DAO for making such a colossal mistake, because they were completely misinformed. But they\u2019re far from the only ones who misunderstand copyrightt \u2013 especially as it concerns the crypto world. Let\u2019s face it: the law is a confusing beast and intellectual property is no different.<\/p>\n

\"\"This isn\u2019t to say that NFTs are bad and people should steer clear. If you\u2019re an artist, NFTs can commercialize types of art<\/a> that previously didn\u2019t have a large market. And if you\u2019re an art aficionado, why shouldn\u2019t you purchase a piece of art that brings you joy or in an attempt to support the creator? However, people should be properly informed of just what they are giving up or buying when it involves copyright.<\/p>\n

So what can you do? Be an informed consumer and read up on what a copyright entails. There\u2019s plenty of law firms<\/a> that have written about intellectual property<\/a> in more easily understood terms than the Copyright Act. If you\u2019re creating or purchasing NFTs, it\u2019s a good idea to consult an attorney before spending hundreds, thousands, or even millions on a product.<\/p>\n

So next time your friend from high school approaches you with a great investment opportunity, make sure they understand the legal consequences of their actions – it may just save you 3 million dollars.<\/p>\n

\"\"<\/p>\n

Andy Sutherland<\/em>
\nAssociate Blogger<\/em>
\nLoyola University Chicago School of Law, J.D. 2023<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Recently, the concept of NFTs, or Non-Fungible Tokens, have taken over the internet as the new, hot investment. Unfortunately, so too have people\u2019s misconceptions about what owning an NFT actually is. Many investors think that owning an NFT of a digital image means owning the underlying copyright to the image. Spoiler alert \u2013 it doesn\u2019t. Continue reading Jodorowsky\u2019s Dune – How Understanding Copyright Can Save You $3 Million<\/span><\/a><\/p>\n","protected":false},"author":35,"featured_media":1997,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3,4],"tags":[49,70,71,72,73,74,84,92,160,215,216,286],"class_list":["post-1994","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-copyrights","category-fun-facts","tag-book-copyright","tag-copyright","tag-copyright-infringement","tag-copyright-law","tag-copyright-license","tag-copyright-misinformation","tag-derivative-work","tag-dune","tag-jodorowsky","tag-nft","tag-nfts","tag-spice-dao"],"_links":{"self":[{"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/posts\/1994","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/users\/35"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/comments?post=1994"}],"version-history":[{"count":3,"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/posts\/1994\/revisions"}],"predecessor-version":[{"id":4245,"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/posts\/1994\/revisions\/4245"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/media\/1997"}],"wp:attachment":[{"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/media?parent=1994"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/categories?post=1994"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.luc.edu\/ipbytes\/wp-json\/wp\/v2\/tags?post=1994"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}