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Davis LLP Web Logs or "Blogs" are intended to provide general comments on developments in the law. They are not intended to be a comprehensive review nor are they intended to provide legal advice. Readers should not act on information in the blogs without seeking specific advice on the particular matter. Please contact a lawyer listed on the blog pages for additional details, or to discuss how blog information is relevant to a specific situation.

Video Game Law Blog

» May, 2007

UFC Parent Lays the Legal Smackdown on Take-Two

Zuffa, LLC, the company behind the Ultimate Fighting Championiship has filed a suit against Take-Two Interactive, alleging that Take-Two sold UFC games - namely, UFC: Sudden Impact, a PS2 title - after Take-Two's right to distribute such games had expired. Zuffa further claims that Take-Two is cybersquatting in respect of the website www.ufcvideogame.com.

The distribution rights for UFC games currently belong to THQ, Inc.

Coverage at: Advanced Media Network

Video Game Publishers Join New Copyright Alliance

The Entertainment Software Association, has joined with other organizations including the Recording Industry Association of America, the Motion Picture Association of America, Major League Baseball, Microsoft, Viacom and Disney to form the Copyright Alliance, a new non-profit organization dedicated to "promoting the value of copyright as an agent for creativity, jobs and growth".

Coverage at: GamePolitics.com

Video Game Distributor Accused of Aiding and Abetting

The U.S. Securities and Exchange Commission (("SEC") has filed a settled civil action against Capitol Distributing, LLC ("Capitol") and an owner of Capital, Terry Phillips ("Phillips"). The SEC has charged Capitol and Phillips with aiding and abetting Take-Two Interactive Software, Inc. ("Take-Two") in certain violations of securities laws. The SEC claims that Take-Two would ship hundreds of thousands of games to Capitol who would then record the shipment as sales even though Capitol only "parked" the games and had no intention of selling them.

As a result of the arrangement, Take-Two was allegedly able to report $US15 million in phantom revenue.

Coverage at: Securities Law Prof Blog

Incentives Legislation Passed in Texas

After a bumpy ride in the Senate, HB1634 has cleared both the Texas House and Senate, passing legislation designed to provide grant incentives to film, television and video game producers. It is reported by GamePolitics that some senators were unsuccessful in their attempt to restrict which game projects were eligible for grants, based on their content.

coverage at: GamePolitics

Illinois Unconstitutional Law Costly

Illinois Governor Rod Blagojevich's law banning the sale and rental of mature games to minors is reported to “have done significant violence to Illinois’ budget”. The state was ordered to pay the Entertainment Software Association more than $500,000 in legal fees and a report attributed to Quad-Cities Online is said to reveal that Gov. Blagojevich spent about $1 million to appeal the 2005 federal court ruling. Apparently the money to defend the constitutional challenge was taken from the public health department, the state's welfare agency and even the economic development department’s budgets.

coverage at: GameDaily

Nova Productions v Mazooma Games & Ors

Phillip Carnell of C'M'S' Cameron McKenna kindly sent us the following summary of the UK Court of Appeal's recent decision in the Nova Productions case. In that case, the owner of a coin-op pool game sued two competitors who created games with similar features. The games looked and played differently and none of the source code for the original game was copied. The court therefore concluded that there had been no copyright infringement.

In the words of the learned Mr. Carnell and his colleagues, "As a result of this judgment (and the previous judgment in Navitaire) it will be difficult for software copyright owners to take action against developers of software which has the same functionality, but which does not copy the underlying code or the graphics displayed on screen."

Case summary here.

OPEN LETTER TO NY GOVERNOR RE: VIDEO GAME LAW

New York Governor Eliot Spitzer is preparing video game legislation in order to deliver on one of his campaign promises. As it turns out, one of Governor Spitzer's old classmates is Greg Costikyan, the CEO of Manifesto Games (an independent games publisher). Mr. Costikyan is not impressed by Governor Spitzer's plans, and has written an open letter to Spitzer about video games and video games legislation. Among other things, the letter calls the proposed legislation a "fruitless attempt to infringe on the rights of New Yorkers, a likely waste of taxpayer dollars, and a wholly unnecessary attack on the 21st century’s most vibrant and promising popular artform".

Open letter here http://shorl.com/luhogidupraki
Coverage here: http://shorl.com/kapeguprupredro (GamePolitics)

WeeWorld Granted Dismissal in Trademark Infringement Case against Nintendo

According to a letter by WeeWorld CEO, Celia Francis, WeeWorld has been granted it's application for dismissal of its US lawsuit against Nintendo for trademark infringement. As we previously reported, WeeWorld brought a suit against Nintendo last November alleging that Nintendo's Mii avatars infringed WeeWorld's trademarks in its WeeMee avatars. WeeWorld subsequently applied to dismiss the case on a without prejudice basis in order to focus on a sister case in Europe before proceeding with its case in the US. To WeeWorld's surprise Nintendo vigorously resisted the application. Despite this resistance WeeWorld was granted its application subject to payment of part of Nintendo's legal fees.

Coverage at speak-geek.co.uk

ANTI-ADDICTION SOFTWARE: JULY 16 DEADLINE FOR COMPLIANCE IN CHINA

Video game operators must comply with new rules imposed by the Chinese government by July 16th. In a move which is bound to have repercussions for game operators, the Chinese government has required that operators implement software controls which restrict the amount of time gamers under 18 years of age are allowed to play video games.

According to the People’s Daily Online, the software will allow video games to be played normally for up to 3 hours following which the number of points that can be earned drops by half for the next 2 hours and then to zero beyond hour 5 of consecutive play time. While this scheme might not be much of a deterrent for avid fans, also having a warning flashed up on the screen ever 15 minutes (following the first 5 hours of play) and needing to register using an identity card in order to play, might prove to be too much for die-hards whether they are under 18 or not.

While video game operators don’t appear to be overly concerned by the requirement to incorporate the "anti-online game addiction” software - that the system also requires every online player to register with his or her real identity does cause some concern because it is likely to have the greatest impact, at least short-term, on sales.

Current coverage at: People’s Daily Online and also at PC-MAC Zone

Previous coverage of this issue at: Games Industry; China View

Jack Thompson Uses VT Tech Shootings as an Excuse to Rant About Video Game Violence, Media and Industry Rant Back

Right after the Virginia Tech shootings, lawyer and famed (infamed?) anti-video game activist Jack Thompson was prominently featured on (surprise!) Fox News, where he attributed just about every school shooting in recent memory to the influence of video game violence on impressionable minds; of particular abhorrence were "Doom" and the "Grand Theft Auto" series, which Mr. Thompson claimed were used as "training devices" by several school shooters.

Most likely due to their exposure to this "incredibly violent entertainment," the video game industry and bloggers are mad as hell and aren't going to take it anymore, and had lots to say about Mr. Thompson's slate of media appearances following the VT Tech Massacre.

Visit http://shorl.com/lyrgranikeki to listen to Mr. Thompson's interview and read the play-by-play de-bunking of his assertions, carefully researched by one blogger. Further editorial comments on Mr. Thompson's anti-videogame stance is featured at http://shorl.com/bripytapiyfeha.

WENDY'S Wii WOES

Anti-violence in video games lawyer Jack Thompson has written to fast food giant Wendy’s to request that it cancel an upcoming kids marketing campaign centered around the Wii console and some games published by Nintendo. His problem? The July 2007 release of Rockstar's ultra violent game Manhunt 2 for the Wii platform. Shacknews reports that, in Mr. Thompson's opinion, the mere availability of Manhunt 2 for Wii results in a high level of "inappropriateness of the above upcoming promotion at Wendy's".

In his letter, Mr. Thompson draws attention to what he considers particularly troubling: the fact that with the Wii platform’s motion-sensitive controllers players must physically emulate the violent behaviour portrayed in the game.

(coverage at shacknews.com)
(Mr. Thompson’s letter is reproduced here)

LEAPFROG PATENT INVALIDATED

(This is an archived case summary)

In this patent infringement action, Leapfrog Enterprises alleged that the Fisher Price PowerTouch product infringed one of the claims in Leapfrog's patent, which describes an interactive learning device. The patent relates specifically to “an interactive learning device having one or more preferably touch sensitive three dimensional indicia bearing units each representing a number or letter which on touching activates voice synthesis circuitry to audibly produce the name and/or phonetic sounds associated with the indicia bearing unit”. The essence of this patent is a device that allows a child to establish relationships between symbols of letters or numbers and the sounds that are made when speaking those letters and numbers.

The allegedly infringing device was an interactive learning device that looks much like a briefcase when opened. Children place books in the device that have pictures of Sesame Street characters, such as Cookie Monster, can select various modes of operation.

This issue of patent infringement was tried in 2005 and resulted in a mistrial. The parties then allowed the US District Court, District of Delaware, to decide the matter. The District Court held that Fisher-Price had not infringed LeapFrog’s patent because the PowerTouch toy did not allow the child to select letters, only words. The Court also determined that claim 25 of LeapFrog's ‘861 patent was invalid, because it was obvious in light of relevant prior art (including another patent geared towards “providing a voice responsive puzzle game in which various words, sounds or phrases of a nursery rhyme, writing or saying may be randomly selected, actuated and enunciated”). LeapFrog appealed to the Court of Appeals, Federal Circuit.

On appeal, LeapFrog argued that the District Court improperly relied on hindsight in determining obviousness, did not have enough evidence of motivation to combine the prior art references, and ignored the secondary considerations of obviousness. The Court of Appeals applied the recent Supreme Court decision of KSR International Co. v. Teleflex, Inc., 1727 S.Ct. 127 (2007), which held that “[t]he combination of familiar elements according to known methods is likely to be obvious when it does no more than yield predictable results.” The Court of Appeals therefore held that “[a]ccommodating a prior art mechanical device that accomplishes that goal to modern electronics would have been reasonably obvious to one of ordinary skill in designing children’s learning devices. Applying modern electronics to older mechanical devices has been commonplace in recent years.”

The Court of Appeals affirmed the District Courts ruling that Fisher Price’s device did not infringe LeapFrog’s patent, and that the patent was invalid for obviousness.

The case is available here.

Leapfrog Enterprises, Inc. v. Fisher Price, Inc.
May 9, 2007 US Ct. of Appeals, Fed. Cir.
2007 WL 1345333
KEYWORDS: patent infringement - PowerTouch - obviousness
Summary by Byron Yep.

Ghost Rider Creator Suing Sony, Marvel and Take-Two

Ghost Rider creator Gary Freidrich is suing Marvel and the two companies responsible for the recent movie and video game adaptations of the comic for what he calls a "conspiracy to exploit and profit from the Johnny Blaze character and persona." Freidrich recovered his Ghost Rider copyrights in 2001, despite a 1971 agreement with Marvel, who Friedrich now alleges undervalued Ghost Rider IP and gathered "lower than acceptable royalties" when negotiating licenses for the production of Ghost Rider merchandise in anticipation of the movie. Freidrich also alleged that Take-Two improperly created Ghost Rider merchandise, at which point his skull turned into a giant ball of flame.

Source: http://www.shorl.com/fropustagrekafe

Mom Sues Sony, Vivendi and Sierra for Inducing Seizures in Her Child

A U.S. mother is suing Vivendi Games, Sierra Entertainment, and Sony Computer Entertainment America for "neligent, careless and reckless" behaviour after her infant allegedly suffered a debilitating epileptic seizure while playing Spyro: Enter the Dragonfly on PS2. While game packaging warns that players may be susceptible to seizures "when exposed to certain light patterns or flashing lights," the mother alleges that the seizure her child suffered was so severe that her child has suffered permanent injuries that affect all aspects of their everyday life. No word on how old the "infant" playing the videogame was or whether the packaging cautioned against letting babies play videogames.

Source: http://shorl.com/seprafukefrahu

The Hoi Polloi in Frenzy

LoadingReality.com reports that thanks to certain members of the media "whipping the ignorant masses" into frenzy about video game violence, a young student from Fort Bend, Texas has been arrested for making a Counterstrike map based on his high school.

(coverage at: http://shorl.com/dilesyligryhu LoadingReality.com)

Sony Victim of Stalking?

In 2006 Sony Computer Entertainment America Inc. applied for an injunction against Dawn Gilbert, as the result of the more than 100 phone calls that she made to Sony personnel between March 2006 and June 2006. Ms. Gilbert's calls were to protest Sony’s taking her ideas products, allegedly disclosed to the company in her handwritten job application letter, in 2002. She wanted payment of $777 billion for her ideas.

Despite a restraining order issued in August 2006, Ms. Gilbert recorded over 100 telephone messages for various Sony employees starting in February 2007. Under recent cross-examination, in contempt of court proceedings, Ms. Gilbert, who represents herself because she says she can not afford a lawyer, testified that she made the calls because she erroneously thought the restraining order was no longer in effect since Sony had dismissed the case against her in December 2006.

Ms. Gilbert has allegedly claimed that Sony took her ideas for the television video game channel G4, a video game show on the Game Show Network, commercials from the Sci Fi channel, the movie "Dragon King," and the PlayStation game Grand Theft Auto.

(coverage at Vindy.com)