Towards a System of Estates in Virtual Property

Abstract

Virtual worlds such as Second Life have received a lot of press in the United States recently. As individuals and businesses participate in these virtual worlds, questions arise regarding the application of existing laws to their virtual world transactions. Many questions have arisen regarding the property rights of participants in virtual worlds, and a Second Life member recently sued Linden Research, the company that developed Second Life, alleging that Second Life converted his virtual property. The questions regarding the legal nature of virtual world assets tend to mirror the questions regarding intangible rights generally, as courts have tended to struggle over whether these rights are property rights or contract rights. In this paper, I propose that the principle of numerus clausus be applied to virtual property, so that courts faced with disputes over such assets will have mandatory property forms to which to resort. Such an approach would limit the ability of vendors of such rights to customize them through their contracts, which are commonly embodied in electronically-presented standard forms.

Keywords: property, virtual worlds, cyberspace

JEL Classification: K11, K19