ip rights in the video gaming industry: protecting and...
TRANSCRIPT
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Presenting a live 90-minute webinar with interactive Q&A
IP Rights in the Video Gaming Industry:
Protecting and Defending Your Game's IP Leveraging Trademarks, Copyrights and Patents to
Protect Product Development to Marketplace Delivery
Today’s faculty features:
1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific
WEDNESDAY, AUGUST 9, 2017
Steven M. Cohen, Senior Intellectual Property Counsel, Open Text, Boston
Mitchell S. Feller, Partner, Gottlieb Rackman & Reisman, New York
Andrew J. Ungberg, Esq., Frankfurt Kurnit Klein & Selz, New York
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IP RIGHTS IN THE VIDEO GAMING INDUSTRY: PROTECTING AND DEFENDING YOUR GAME’S IP
Andrew Ungberg Mitchell S. Feller Steven M. Cohen
IP Rights in the Video Gaming Industry: Protecting and Defending Your Game's IP
I. GAMES AS IP – INTRO TO RIGHTS PROTECTION
A. Copyright
B. Trademark
C. Patent
II. COMMON PITFALLS FACING NEW DEVELOPERS
A. Licenses, ownership and selling a game – defects in chain of title and scope of rights
B. Open source considerations
C. The problem with a handshake deal–ownership issues among contractors and employees
III. LEGAL CHALLENGES FACING VIDEO GAME INDUSTRY
A. Lessons from Oculus
B. Game Cloning
C. Data Privacy
IV. QUESTIONS AND ANSWERS
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GAMES AS IP – INTRO TO
RIGHTS PROTECTION
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Copyright – Nuts and Bolts
Grants Author of a Creative Work the Exclusive Rights to:
Copy, Modify, Display or Perform, Distribute
Duration: Life of the author + 70 years, else 95/120 year
Procedure: All works protected automatically upon creation
Federal Registration: Low cost, substantial benefit
8
Copyright in Games
“Even so, BREAKOUT would be
copyrightable if the requisite level
of creativity is met by either the
individual screens or the
relationship of each screen to the
others and/or the accompanying
sound effects.”
Atari Games Corp. v. Oman, 979 FC.2d
242 (Fed. Cir. 1992) (Ginsberg, J.)
9
Early Games Fought for Recognition and Protection under Copyright Law
Breakout VI, Atari 1978
Copyright in Games
Games are
Copyrightable Audiovisual Works
Game Elements Protected as . . .
• Literary Works
Software Code
Script & Spoken Dialogue
• Musical Works
Music & Score
Sound Effects
• Pictorial, Graphic Works
Art Direction
Character & Level Design
• Derivative Works
Unique Characters
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L.A. Noire, Rockstar Games 2011
Copyright – Scope of Protection
Protectable Non-Protectable
• Text of Instructions
• Game Rules or Mechanics
• Basic Game Board Layouts
• Point Systems
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Copyright Applies to Expression, Not Underlying Ideas
• Graphical Appearance of Game
• Design of Unique Characters
• Mario, Lara Croft
• Plot and Narrative
Copyright – Scope of Protection
Common Gameplay and Narrative Tropes
- Player Health Bar
- Generic Power-Ups / Health Packs
- Martial Arts Moves, “Bullet Time”
- Shields, Teleportation, Laser Guns
- Zombies, Pirates, Ninjas, Mechs
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Copyright Does Not Protect “Scenes a Faire”
Stock expression standard or indispensable
in the treatment of a given idea.
Copyright – Scenes a Faire in Games
Dawn of the Dead, 1978 Dead Rising, 2006
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Capcom Co., Ltd. v. MKR Grp., Inc., No. C 08-0904, 2008 WL 4661479, at *10
(N.D. Cal. 2008) (finding zombies, improvised weapons, mall setting all scenes a
faire for zombie-survival horror genre )
Copyright: Risks for Software
― Oracle v. Google – Java software APIs and Fair use
― Registration requirements – disclosure of source code
― Copyright circular 61
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Trademark
• What is a Trademark?
― “Any word, name, symbol, or device … used to identify and distinguish
someone’s goods (including a unique product) or services, from those
manufactured or sold by others and to indicate the source of the goods
or services...” (15 U.S.C. § 1127)
• Trademark Rights protect against likelihood of consumer confusion about
the source or sponsorship of goods or services.
• Establishing Trademark Rights
― Common law rights
― Federally-registered marks
• Conflict – rights go to the earlier user of the mark in commerce
― Intent-to-use application
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Trademark
• Trademarks can be used to protect the name of the game company, the name
of the game (even if not a series), the game logos, characters, other features
that serve as identifiers of the source of the game or services / products
associated with the game (game engines, game distributors, etc).
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Trademark
• Trademark Infringement
― Cease and Desist letters
– Obligation to police your marks
– Opportunity to negotiate
― Legal remedies
– Injunction
– Money damages (profits from the infringement) and attorney fees in exceptional cases
― Commercial remedies
– Desisting of application from distribution / hosting company
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Trademark
18
• Game Names are common grounds for infringement assertions and
cases are typically resolved without a lawsuit.
changed to
Præy For the
Gods”
• Beware of overreach!
King.com Ltd.’s CANDY CRUSH SAGA - any game with “CANDY”
Lima Sky Doodle Jump – any game with “DOODLE
changed to
Action Alien
Trademark
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Use of third-party trademarks in games
• Games are expressive works and subject to the first amendment
(Brown v. Entertainment Merchants Ass'n, 131 S.Ct. 2729 (2011).
• Rogers test balancing trademark rights with first amendment rights:
Use of a trademark is infringing if:
(1) the use of the mark has “no artistic relevance to the
underlying work whatsoever,” or
(2) it has some artistic relevance, but “explicitly misleads as to
the source or the content of the work.”
(Rogers v. Grimaldi, 875 F.2d 994 (2d. Cir. 1989)
Trademark
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― E.S.S. Entertainment 2000 v. Rock Star Videos – (547 F.3d 1095 (9th Cir. 2008)
Grand Theft Auto / “The Play Pen”
― Mil-Spec Monkey, Inc. v. Activision Blizzard, Inc - (75 F. Supp.3d 1134 (N.D.Ca
2014)) Call of Duty / Angry Monkey mark.
― But see - Electronic Arts, Inc. v. Textron, Inc. - Battlefield 3 / Bell helicopter
names and trade dress. (2012 U.S. Dist. LEXIS 103914 (N.D.Ca 7/25/2012)
Patent
• What is a Patent?
― A patent is a limited monopoly that gives its owner the right to prevent
others from practicing a patented covered invention.
• Two types of patents
― Utility Patent – covers ideas embodied in a machine, a process
(software), a composition of matter, or a manufactured item.
― Design Patent - cover ornamental design (shape or ornamentation) of an
object.
• Getting a patent can be time consuming and expensive but it can be very
valuable where the covered invention can applied across many different
products and applications.
• Common game related areas where patents are sought include hardware
platforms and accessories, software engines that drive game features,
technology for distributing games and updates, for hosting multi-player
games, etc.
21
Patent
• Establishing Patent Rights
― A Patent application is submitted to the USPTO. The application must
disclose the details of how the invention works (hardware design;
software algorithms, etc.)
― Patent examiner evaluates the application to determine if the claims
being sought meet the various criteria for patentability.
― Statutory bar for prior public use or sale of the invention.
― U.S. has 1 year grace period. Most countries have none
― Beware of beta testing / early access.
― Average pendency of an application is about 2 years. Software patents
frequently take longer.
― Utility patents publish by default 18 months after filing. This is
frequently before the fist substantive examination. No enforceable
patent rights until patent is issued (if at all).
22
Patent
• Real world examples of some recent game-related utility patents:
― “Overlaying interactive video game play with real-time chat sessions
with game switching”
― “Method and system for granting access to system and content”
― “Anti-cheat facility for use in a networked game environment”
― “Method and system for preloading resources”
― “System and method for detecting moment of impact and/or strength of
a swing based on accelerometer data”
― Video game system and toy with RF antenna
― “System and method for playing a music video game with a drum system
game controller”
― “Systems and method for making gameplay changes based on social
networking poll”
― “Systems and methods for reproduction of shadows from multiple
incident light sources”
23
Patent
• Examples of some recent game related design patents:
Game Controller Game Console
Guitar shaped game Gaming display screen with
controller fret board multiple arrays of reels
24
Patent
• Criteria for patentability: The claimed invention must be
― Directed to patent eligible subject matter:
“Whoever invents or discovers any new and useful process,
machine, manufacture, or composition of matter, or any new and
useful improvement thereof, may obtain a patent therefor. (35
U.S.C. § 101)
― Excludes laws of nature, natural phenomena, abstract ideas,
including mental processes and mathematical algorithms
― Novel (35 U.S.C. § 102) (Not known) and
― Non-obvious (35 U.S.C. § 103) (Not something a person of
ordinary skill in the art would be expected to come up)
25
Patent
Patentable Subject Matter, Software and CLS Bank v. Alice (2014)
• Supreme Court decision expanded the scope of unpatentable
“abstract ideas” to cover many previously patentable aspects of
software.
• Two part test: (1) is the claim directed to an abstract idea? (2) if so,
is there significantly more?
― Many broader aspects of software are considered to be
“abstract” concepts. Does the invention automate an existing
real-world problem or address an issue that exists only in the
computer realm?
― “Significantly more” requires going beyond using the hardware
for its intended purpose. Look for a technical solution /
improvement to the underlying technology itself
26
Patent
Line between Abstract unpatentable idea and a patent-eligible one can
be hard to draw.
• McRO, Inc. v. Bandai Namco Games America, Inc. (Fed. Cir. Sept. 13,
2016) (Reyna)
― Patent directed to a rules-based method for automating
matching the motion of an animated face to audio dialog. The
rules linked facial changes to transitions between phonemes (a
“morph target” approach)
― 2014 -- McRo sued dozens of major companies in the gaming
industry for patent infringement
27
Patent
• McRO, Inc. v. Bandai Namco Games America, Inc. (con’t)
― DC held the patent invalid under Alice as claiming the abstract idea of
rule-based lip synchronization based on the general “morph target”
approach and because it covered all such rules. Case dismissed for
failure to state a claim.
― Federal Circuit reversed, holding that the claimed invention was limited
to rules with specific characteristics, and the claimed invention did not
simply automate existing conventional activity.
― Currently on remand where the parties are addressing claim
construction, infringement, and validity.
• Compare with Recognicorp, LLC v. Nintendo (Fed. Cir. 2017) – improved
method of making a composite image where facial features are represented
by element codes. Affirmed invalidity under Alice. Claim directed to
abstract idea of encoding and decoding image data. No technical solution.
Just data manipulation.
28
II. COMMON PITFALLS FACING
NEW DEVELOPERS
29
Licenses, ownership, and sale
• Game is large bundle of rights encompassing copyrights, trademarks,
patents, and possibly other rights (trade secrets etc.)
• Many rights develop when work is created and ownership doesn’t
always transfer to the company.
• Need reliable process to track of all rights that end up in your work,
whose they are, and any limitations on use of the rights.
― Are all of the needed rights assigned / licensed?
― Do not rely on work for hire. Does not always apply (software)
― If you licensed third party content, what restrictions come with
that license?
30
Open Source Software
• Open source software licenses allow covered software to be freely used, modified,
and/or shared. Use of open source code is common but can be risky because different
types of licenses impose different obligations on the user
• Types:
― Copyleft – requires derivative software have the same or equivalent license as
the original work
― Strong Copyleft –requires the entire derivative work (including larger
works) to remain open-source in the future. (Example – GNU GPL license)
― Weak Copyleft – does not necessarily apply reciprocally to all derivative
works. Larger work can be distributed without source code / under
different terms for added files (Example – Mozilla public license; GNU
Lesser GPL license)
― Permissive – a non-copyleft open source license. Can use, modify, and
redistribute the code. Permits proprietary derivative works. (Example - MIT
license)
• Terms of the license typically are included in the open source code itself.
31
The Pitfalls of a Handshake Deal
Freelance Software Coder Hired by Email:
Hey Rob,
Steve said you might be interested in doing some work for us. We need someone
to restructure old code, fix bugs, make tools, etc. I’m looking for someone
focused, who can do that for 8 hours a day, 6 days a week for like the next
5months. You seem like that type of person. The job is $2500 per month to start.
If we like what we see, that can increase.
Eventually, I want to be in a position where you might be developing full games
with us, which we’d sell on the appstore or whatever, and once it clears costs you
can get a 30% cut (maybe more, tbd). We invest in our people. Does that sound
like something you’d be interested in?
32
The Pitfalls of a Handshake Deal
Issues
• Freelancer’s Work Not Work for Hire
— Freelancer is an independent contractor, not an employee
— Software is a literary work, not eligible for commissioned work for
hire
• Licensing Exposure
— (Possible) Implied License
— . . . But no specified term, bar on termination, vague on payment
• Risk of Joint Ownership on Future Projects
— Vague promise of profit share on future work
— Joint owners enjoy all rights under Copyright Act, subject only to
duty to share resulting profits
33
The Pitfalls of a Handshake Deal
If Client Believes in Project, Prepare for Success
• IP Ownership Agreements as Important W-9 Forms
— Assignments, not form work for hire agreements
• Digital Distribution Can Mean Change Everything Overnight
— Basement startup to $50 million in sales over 18 months
• Can’t Rely on Personal Relationships or General “Understanding”
34
III. LEGAL CHALLENGES FACING
VIDEO GAME INDUSTRY
35
LEGAL CHALLENGES FACING VIDEO GAME INDUSTRY
36
• Lessons and considerations from ZeniMax v. Facebook
― Copyright, trade secrets, and liability lurking with new employees
― Replacing licensed software and reverse engineering
LEGAL CHALLENGES: GAME CLONING
37
LEGAL CHALLENGES: GAME CLONING
Tetris Holdings, LLC v. Xio Interactive, Inc.,
863 F. Supp. 2d 394, 410 (D.N.J. 2012)
• Key Facts
• Xio admitted to copying Tetris, but claimed only “rules and mechanics” were taken.
• In short: alleged Tetris not protected
• Visual Design of Tetris Protected
• Use of “Garbage” Lines
• Use of “Ghost” Images
• Display of Upcoming Piece
• Court Specifically Contrasted Mino
with Dr. Mario
38
Tetris Mino
Tetris
39
Dr. Mario
LEGAL CHALLENGES: GAME CLONING
LEGAL CHALLENGES: GAME CLONING
DaVinci Editrice S.R.L. v. Ziko Games, LLC, 183 F. Supp. 3d. 820 (S.D.
Tex. 2016)
• Key Facts
• Card Games Bang! and Legend of Three Kingdoms shared virtually identical rules, mechanics and gameplay.
• Wild West vs. Martial Arts Theme
40
Legend of Three
Kingdoms
Bang!
• Likely No Infringement
• Ziko took rules,
not expression
• Unique Characters
LEGAL CHALLENGES: GAME CLONING
Spy Fox LLC v. LOLApps, Inc., No. 12-cv-00147 (W.D. Wash. 2012)
41
Yeti Town, 6Waves Triple Town, Spry Fox
Riot Games, Inc. v Shanghai Montoon et al. (Filed July 6, 2017
C.D.Ca)
42
• Alleges copying of visual aesthetic, characters, powers, maps
• Added component: Trademark Infringement
LEGAL CHALLENGES: GAME CLONING
LEGAL CHALLENGES: PRIVACY
• UNITED STATES
― Federal Children’s Online Privacy Protection Act (“COPPA”)
– Broad protections for minors under 13 years old
– Requires notice and verified parental consent
– Up to $40k per violation
― California (“CalOPPA”)
– Requires “conspicuous” notice of privacy policy
– AG and private rights of action
• EUROPEAN UNION – General Data Protection Regulation (GDPR)
― Extremely Broad: Applies to processing data of subjects in EU if
processing relates to (a) offering of goods or services to subjects; or (b)
the monitoring of the subjects takes place in the EU.
― Right to Erasure / Right to be Forgotten: social media, search engines
43
Thank You
Steven M. Cohen
Open Text
Mitchell S. Feller
Gottlieb Rackman & Reisman
Andrew J. Ungberg
Frankfurt Kurnit Klein & Selz
44