Embedding copyrighted images into social media posts without the necessary publishing rights has already been found to be illegal in some cases:[1] > Federal c

Embedding copyrighted images into social media posts without the necessary publishing rights has already been found to be illegal in some cases:[1] > Federal courts are split, and recent rulings found that embedding social media posts on third-party websites could be copyright infringement. > Some decisions have even stated that while social media sites “clearly foresee the possibility of entities…using web embeds to share other users’ content, none of them expressly grants a sublicense to those who embed publicly posted content.” The courts rejected motions to dismiss for fair use, stating that sharing such content is not a transformative use. A seller who embeds a copyrighted image into an NFT marketplace listing without the necessary publishing rights and then sells the NFT would be more likely to be liable for copyright infringement than the social media embedder. This is because commercial use of copyrighted content is less likely to satisfy the fair use criteria:[2] > Purpose and character of the use, including whether the use is of a commercial nature or is for nonprofit educational purposes: Courts look at how the party claiming fair use is using the copyrighted work, and are more likely to find that nonprofit educational and noncommercial uses are fair. This does not mean, however, that all nonprofit education and noncommercial uses are fair and all commercial uses are not fair; instead, courts will balance the purpose and character of the use against the other factors below. Additionally, “transformative” uses are more likely to be considered fair. Transformative uses are those that add something new, with a further purpose or different character, and do not substitute for the original use of the work. Someone who sells an NFT without publishing rights is harming the market for NFTs derived from the copyrighted work. This also reduces the chance that a fair use defense would be accepted in court:[2] > Effect of the use upon the potential market for or value of the copyrighted work: Here, courts review whether, and to what extent, the unlicensed use harms the existing or future market for the copyright owner’s original work. In assessing this factor, courts consider whether the use is hurting the current market for the original work (for example, by displacing sales of the original) and/or whether the use could cause substantial harm if it were to become widespread. [1] https://news.bloomberglaw.com/us-law-week/is-embedding-social-media-content-legal-courts-disagree https://news.bloomberglaw.com/us-law-week/is-embedding-socia... [2] https://www.copyright.gov/fair-use/more-info.html https://www.copyright.gov/fair-use/more-info.html