Mango convicted of copyright violation at NFTS

A court in Barcelona has made a judgment never before in Spanish legal landscape: The fashion group Mango has been convicted of the unauthorized use of digitized works of art.

The judgment of the 15th Chamber, which specializes in commercial law, stipulates the violation of copyrights in the context of non-fungable tokens (NFTS) and virtual environments such as the meta person for the first time in Spain. The case, which was struck by the exploitation company Visual Entión de Artistas Plásticos (Vegap) on behalf of the heirs by Joan Miró, Antoni Tàpies and Miquel Barceló, goes back to a marketing campaign that accompanied the opening of a mango branch in New York in 2022.

Digital strategy in court

In May 2022, Mango celebrated the opening of his flagship branch at the Fifth Avenue in New York with an ambitious digital campaign. In the branch, the brand exhibited five original works by the Spanish artists Joan Miró, Antoni Tàpies and Miquel Barceló from the private collection of Isak Andic, the founder of the company. In addition to the physical exhibition, Mango brought the works to a new digital dimension. They were converted into animated compositions and distributed as NFTs. These digital works of art have been distributed over various platforms, including the OPENSEA marketplace and the Virtual Universum Decentraland. They were also advertised on social networks such as Instagram, Tikkok and LinkedIn.

Ownership of a picture does not entitle to digital use or change

The digitization and distribution of these works without the express consent of the author or their heirs led to the complaint by the Vegap, which represented the rights holders. In its complaint, the Vegap asserted the violation of several rights protected by the Copyright Act: reproduction, processing, public reproduction, work integrity and distribution law. The Vegap argued that the physical possession of an image does not include the right to use or change it digitally. The use of these works as part of a marketing strategy without prior license not only violated property rights, but also “damaged the image and the cultural heritage of the artists”. The Vegap called for the immediate removal of the NFTS and any digital reproductions, the publication of a public correction and compensation of over 1.3 million euros for economic and moral damage.

Initial judgment in favor of Mango

In January 2024, the ninth commercial court in Barcelona dismissed the complaint of the Vegap. The first instance judgment was released. The company argued that they had acted in good faith and without a profit intention. The defense claimed that the initiative aimed to enrich the public experience, promote culture and to appreciate the artists. In the absence of clear regulations on NFTs, all of this was done in the Spanish context. Mango even referred to a similar interpretation as the Anglo -Saxon concept of the “Fair Use”.

Appeal and conviction

The vegap appealed. After months of legal dispute, the 15th Chamber of the Regional Court of the appeal took place and opened the original judgment. Mango was convicted of violating copyright and personal rights. The judgment orders the immediate cessation of illegal activity and the destruction of all NFTs and physical or digital materials that are derived from the changed works. It also obliges Mango to publish the content of the judgment on its website and on social media in order to publicly recognize that it acted without the artist’s approval. The compensation amount was set at around 750,000 euros.

A precedent on unexplored terrain

Although Mango has announced that the judgment is appealed to the Supreme Court, it is already a turning point in the Spanish case law. It is the first time that a copyright infringement in the context of NFTS and the meta verse is recognized. Mango also emphasizes that there was never an intention to make a profit or intention to use the works commercially. It is also argued that up to this point there were no court decisions or specific regulations that clarified the legal limits of the use of digitized art as NFTS. However, the verdict is a clear victory for the vegap. Her managing director, Javier Gutiérrez, described the judgment as “historical” because it is the legal protection of visual artists: extended inside to the virtual environment. He emphasized that this decision confirms the principle that copyrights also apply when technologies are new and disruptive. The Mango case leaves a clear teaching for the industry: Even if the legal framework develops, the rights of the author – their recognition, integrity and just remuneration – remain fundamental columns in the meta verse.