The Intersection of Fashion, Virtual Reality and the Law

Virtual reality and augmented reality are catching on, and the fashion industry has taken notice. Many of today’s fashion brands are seeing their work being used in this disruptive technology. But, this has caused trademark issues for both fashion companies that want to protect their brands and fashion technology companies that want to bring those brands into the virtual reality world.

Moira Lion and Jeff Greene, with the Intellectual Property Group at Fenwick & West, recently sat down with IPWatchdog to discuss how to approach VR innovations as they develop brand protection. Lion focuses on U.S. and international trademark clearance, trademark prosecution, dispute resolution, and enforcement. And, Greene focuses on strategic foreign and domestic brand counseling and protection, including the development of global trademark portfolios, creative brand enforcement strategies, licensing of brand assets and advertising.

VR/AR technology is the direction that retail is moving toward, according to Lion. From a functional perspective, it is showing up in the form of virtual stores, virtual dressing rooms, mobile apps, mirrors, and virtual closets – technology that enables users to shop in virtual environments that resemble real stores, to virtually try on clothing, accessories, and makeup and then purchase products from the same platform, or to have their personal closets in the palms of their hands.

“With VR tech, a customer can be transported through a VR headset to a store or even a social setting in which an outfit may be worn, whereas with AR tech, the customer’s static or live image can be enhanced with overlaid 2d or 3d images of clothing, shoes and makeup or images of new locations and surroundings through a display screen like a phone or mirror screen,” explained Greene.

However, this technology is also being used to create buzz and to enhance customer engagement with fashion brands. For instance, it is making the runway show experience accessible to customers through VR headsets, or by providing mobile apps that change or reveal additional content when placed over what might otherwise appear to be a typical advertisement.

“Not only are fashion brands seeing their work being used in VR/AR technology, but they’re also adopting and exploring using VR/AR tech themselves,” said Lion. “It’s appealing to fashion brands because VR/AR technology can make products more accessible than they are on standard e-commerce platforms, can create an intimacy with products that makes customers feel like they already own them before physically seeing them, and can further streamline the customer journey from the point of first being introduced to a product to the point of purchase.”

Fashion has always been about people expressing themselves, but the shopping experience hasn’t always reflected or enhanced that goal, per Greene. With VR/AR technology, it’s no longer about choosing an item of clothing, but rather a lifestyle. “There have been a lot of discussion lately about the decline of the department store and how customers are increasingly interested in alternative ways to shop,” he said. “VR and AR technology can address both issues – it can create a more immediate and deeper relationship with the customer by connecting on a sensory level.”

Today’s fashion tech companies are interested in solving problems. And, they want to use technology to make remote shopping more efficient, accurate, and fun, to allow consumers to have remote access to their personal closets, and to enhance how consumers interact with the fashion world. To do that, fashion brands and their products need to be incorporated into these new tech platforms.

“Storefronts and interiors, clothing, accessories, and makeup are all recreated in 2D and 3D forms so that these third-party products can be featured on these platforms for customers to interact with,” explained Lion. “The apparel field is also a trillion-dollar industry, so fashion provides a unique opportunity for tech companies to explore VR/AR tech and hopefully take a piece of that.”

With the rise of VR, there’s more digital content that now exists – and in that content, there may be unlawful uses of fashion brands’ trademarks. The more content that’s out there, the more difficult it can be for a fashion brand to identify all unlawful uses of trademarks and trade dress to enforce its trademark rights.  Like other instances where third party marks are visible in movies, courts will likewise conclude that use of a third-party fashion brand’s mark in VR/AR technology is not infringement when those uses are referential. So, developers are creating replicas of designers’ clothing in animated form, and VR/AR technology has the additional element of allowing consumers to interact with a fashion brands’ products, often resulting in a sale via that technology.

“Replicating designs, providing this intimate interaction, and then selling those clothes may be just enough to appear that those fashion brands have worked with these tech companies and therefore produced, contributed to, endorsed, or sponsored that technology,” explained Lion and Greene.

Additionally, the rise of VR and increase in new forms of digital content raises a problem with the ability to clear names for potential trademark use. The more content that needs to be searched, the harder it is to know if a third party already uses a mark. As virtual stores and virtual dressing rooms become the norm for mainstream retailers, retailers will naturally need to use fashion brands’ products and marks on those VR/AR platforms. Normal distribution deals may not address use of a fashion brand’s mark on those VR platforms. And, since fashion brands want their products sold through those stores, there’s pressure for fashion brands to agree to retailers’ use of its marks in VR platforms without much restriction.

In the case of virtual stores, dressing rooms, and closets, developers and retailers are recreating clothing in 2D and 3D form, which raises some quality control issues that can affect the goodwill of a brand, per Lion and Greene. If third party retailers are recreating bad renderings of a fashion brand’s products, customers may associate that poor quality with the fashion brand, rather than seeing it as a platform issue. Today, VR creates a new forum in which marks can be used or misused, and fashion brands must adapt to that.

“It’s a bit unrealistic to search the content of all VR apps, but fashion companies should focus on fashion-oriented VR apps and devote some resources to seeing if their brands are being used in the apps and if users are interacting virtually with their products,” they explained. “That interaction might go just far enough to look like the fashion brand has sponsored or endorsed the VR app, which would be an infringing use – not a fair use.”

Developers must approach designing virtual stores knowing that some companies own trade dress registrations for protectable aspects of real-life store layouts that could be enforced against a virtual store layout. According to Lion and Greene, developers can’t just design a virtual store based on a favorite real-life store without knowing if there are protectable aspects of that layout.

Fashion brands should make sure any existing trademark licenses in agreements with distributors or other parties have language to cover use of the mark in the VR environment and restrict that use. To ensure quality control and maintain any goodwill established in a fashion company’s brand, there should be a provision in these agreements ensuring that if the fashion brand doesn’t find the virtual renderings of the products to accurately reflect the products, then the fashion brand can pull them from the virtual platform or make suggested changes to the virtual designs.

Today, VR/AR technology is still not mainstream, so as it grows and as the real and virtual worlds in fashion increasingly overlap, more legal issues will come to light. While being on the cutting edge of using tech in fashion has the appeal of creating buzz for a brand, brands shouldn’t get caught up in building buzz at the expense of brand protection. Likewise, it can be easy for tech-oriented companies to focus more on the goal of solving a problem or disrupting an industry than on the affect it’ll have on others’ protectable rights or the legal repercussions that may affect the core of their business.


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