More on the Infinity Ward lawsuit: EA to join the party?
UPDATE: apparently, West and Zampella have filed a response to Activision's application to enlarge its lawsuit against them, basically complaining that Activision is trying to bankrupt them in the litigation. Ouch. Ofc, hopefully they have more substantive grounds for opposing Activision, but since irritatingly no one has published the court documents, I can't check :/
So, there have been further developments in the most (in)famous recent lawsuit in the games industry: Activision v Jason West and Vince Zampella, which I've written about previously here and here.
So, there have been further developments in the most (in)famous recent lawsuit in the games industry: Activision v Jason West and Vince Zampella, which I've written about previously here and here.
The key development is that Activision is seeking both to join EA to the litigation and to claim damages of some $400m from it as well. Ouch. More generally, further evidence is building up that this case is the first big film lawsuit type case (big studio v creatives and other big studio) in the games industry so far...
The story so far
- Activision bought up 100% of Infinity Ward in the early Noughties for $5m. Infinity Ward generated a lot of revenue and critical acclaim for Activision through the Call of Duty series of first person shooter (FPS) games.
- Activision approached studio heads West and Zampella after the release of Call of Duty 4: Modern Warfare to develop what became Modern Warfare 2, and offered to extend their employment contracts. West and Zampella reluctantly agreed.
- However, Activision now argues that - essentially - West and Zampella then engaged in a pattern of improper behaviour on a range of fronts, including demanding more money, withholding bonuses from their Infinity Ward colleagues, and then misappropriating Activision confidential information.
- Earlier this year there was a confrontation between Activision, West and Zampella - which led shortly to West and Zampella leaving on acrimonious terms and Activision commencing this lawsuit. It has just got nastier since then.
- West and Zampella then formed Respawn Entertainment, backed by EA.
The new developments
Activision starts off the latest court document stating that, following disclosure of documentation in the lawsuit, new information has come to light which they claim shows that EA was actively involved in poaching West and Zampella. You can find some of the colour at Joystiq, but essentially Activision says that EA worked at the very highest levels in order to persuade West and Zampella to join EA in order to boost its (allegedly) flagging efforts in the FPS genre. In fact, Activision goes so far as to label this as a "destabilize, disrupt and attempt to destroy Infinity Ward" and as "corporate espionage".
Activision also takes the time to go into some detail on EA's recent history. None of it is complementary, to say the least. Activision even goes so far as to refer to "the fall of EA and the rise of Activision" and to discuss EA's "precipitous decline in stature with investors, and most importantly, in the eys of games players who demand innovation and excitement".
Activision also makes further allegations against West and Zampella, calling them "small minded-executives almost obsessed by jealousy of other developers" and claiming that they deliberately worked to damage other studios' work (apparently this refers to Treyarch, another CoD developer). Further, Activision claims that West and Zampella appropriated up to a third of the Infinity Ward bonus pool for themselves and refused to allow Activision to pay out bonuses to other IW staff. Lastly, Activision claims that West and Zampella have been engaged in poaching IW staff and that they have retained confidential Activision information.
Activision now seeks to claim (among other things):
- Damages against West and Zampella as well as recovery of all previous sums paid to them
- An injunction stop West, Zampella and EA from soliciting further Activision employees and from using Activision confidential information
- From EA, damages/compensation for:
- The profits Activision would have made but for EA’s interference (I think this is the $400m bit)
- Activision's costs in rebuilding IW following the departure of West and Zampella
- The loss caused by delay to Activision’s new games being developed by IW (presumably this is Modern Warfare 3)
IMPORTANT CAVEAT: Activision is not actually claiming all of this in the litigation yet - effectively it needs the court's permission to do so. As a result, there is a court hearing scheduled for January to hear these matters further. Therefore, at the moment at least, EA is not technically a defendant to this lawsuit.
THOUGHTS
Activision and EA aren't friends any more
Wow. Activision is not pulling any punches with this lawsuit. Not only are they suing EA for $400m, but they make some really quite aggressive comments about EA as well. Until now, while Activision and EA haven't exactly always been friendly to each other, my impression was that they had been relatively civil to each other recently. Well that's disappeared and I think the genie is out of the bottle for well and good on that front, too.
So, no settlement then?
Widespread industry speculation when the original lawsuit started was 'ah, it'll just settle'. My experience as a litigator is never to make bets about whether a legal fight will settle or not - you just don't know all the variables. It might still settle. But the fact that Activision has just massively expanded this case by seeking to add in the no. 2 games giant in the world suggests that settlement is not on their mind...not yet anyway.
$400m is a lot of money
Well, it IS a lot of money - and that's just the quantified bit of Activision's claim, they're actually after more than that. IF successful in due course, that would put a decent dent in EA's finances. Who knows what impact that could have?
This is just like Hollywood
Two creative types help to build a huge blockbuster hit for their studio and then allegedly conspire with a talent agency to jump ship to a rival studio, only to find out their original studio partner is not a happy bunny and sues everyone. Sounds like Hollywood? Well, now it has come to the games industry...and I suspect we will see more of in the future.
This will just get nastier
There is a court hearing in January 2011. Trial is set for May 2011. We have a volatile mix of companies and individuals involved. They are already throwing about incendiary allegations about each other, which Activision says it can prove with documents.
From what I can see (though court documents alone are only part of the story), it seems to me that Activision do seem to have some legitimate grievances, IF it is correct that EA sought actively to poach West and Zampella while all of them were aware of their contractual obligations to Activision. On the other hand, we have yet to see West and Zampella's response, who will no doubt continue to argue that Activision made their life impossible.
Ultimately of course, all of the hyperbole will have to draw to a close and the court will have to decide the relatively simple issues of law in this litigation: what do the employment agreements and related documents say, did West and Zampella breach their obligations therein and did EA encourage or assist those breaches?
Here's looking forward to 2011...
UPDATE: Eurogamer asked my views on whether Activision could attempt to block Respawn's next game. Short answer: I said yes. More here: http://www.eurogamer.net/articles/2010-12-23-will-activision-block-respawns-ea-game !
UPDATE: Eurogamer asked my views on whether Activision could attempt to block Respawn's next game. Short answer: I said yes. More here: http://www.eurogamer.net/articles/2010-12-23-will-activision-block-respawns-ea-game !
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[Image credit: Gamerant/Activision]
Interplay's gamble: the Fallout lawsuit continues
We now have confirmation that the lawsuit between Interplay and Bethesda over the Fallout IP has not been quietly settled (thanks to The Vault). In fact, it seems to be hotting up.
The story so far...
Interplay sold the post-nuclear dystopian games series Fallout to Bethesda in 2007, as part of which they agreed that Interplay would retain certain licence rights, including the right to develop a Fallout MMO. In 2009 Bethesda commenced this lawsuit, claiming that Interplay had breached that agreement, infringed Bethesdra's trademark rights in the Fallout series and that, as a result, Interplay has forfeited all remaining rights in the Fallout IP. Interplay denied Bethesda's claims and counterclaimed that it still has rights in the Fallout IP, including the right to create a Fallout MMO (then known, rather mysteriously, as "Project V13").
At the end of 2009, Bethesda unsuccessfully applied to court for a preliminary injunction effectively prohibiting Interplay from doing anything with the Fallout IP until the resolution of the lawsuit. A month later, Bethesda launched an appeal against the court's refusal to grant that preliminary injunction, which it later dropped.
Then it got a bit mysterious: at around the same time, a beta sign-up page for Fallout Online appeared, which appeared to suggest that Bethesda and Interplay were cooperating notwithstanding the litigation (the bottom of the sign-up page reads:
"Fallout® is a registered trademark of Bethesda Softworks LLC, a ZeniMax Media company, in the U.S. and/or other countries, and is used by Interplay under license from Bethesda Softworks LLC. All Rights Reserved."
Which suggests ofc that perhaps Bethesda and Interplay are cooperating over Fallout Online after all...which made me wonder if maybe there had been a handshake and the lawsuit had quietly been settled?
"Fallout® is a registered trademark of Bethesda Softworks LLC, a ZeniMax Media company, in the U.S. and/or other countries, and is used by Interplay under license from Bethesda Softworks LLC. All Rights Reserved."
Which suggests ofc that perhaps Bethesda and Interplay are cooperating over Fallout Online after all...which made me wonder if maybe there had been a handshake and the lawsuit had quietly been settled?
What has happened now?
In fact, the lawsuit continues - and how! The Vault, a Fallout wiki, has received a further batch of court documents which both confirm that the lawsuit is ongoing and highlight some of the recent developments. Now, I don't yet have access to those court documents, so I can't establish myself exactly what is going on and how it relates to Fallout Online. However, we do know that:
(1) Bethesda is continuing to argue that it owns all the IP rights in the Fallout series.
(2) Bethesda is now also arguing it gave Interplay rights over only the Fallout trademark and nothing else. In other words, Bethesda argues that Interplay has no rights over any other Fallout IP, including for example artwork artwork (e.g. weapon art) or game concepts (e.g. the (in)famous "PIP Boy"), all of which Bethesda says it purchased from Interplay in 2007.
The practical effect of that argument (if successful) is that it would make it extremely difficult for Interplay to use much of the previous Fallout games in Fallout Online at all, which would be both a creative and commercial headache for Interplay. Example off the top of my head: Interplay couldn't, for example, just import Megaton (either nuked or not nuked, natch) into Fallout Online, at least as it is shown in Fallout 3 anyway.
(3) Bethesda is also apparently taking other steps to make life difficult for Interplay, including demanding that Interplay provides it with access to its internal Fallout Online design document wiki as part of the litigation (which Interplay is refusing on the basis that it contains trade secrets).
(1) Bethesda is continuing to argue that it owns all the IP rights in the Fallout series.
(2) Bethesda is now also arguing it gave Interplay rights over only the Fallout trademark and nothing else. In other words, Bethesda argues that Interplay has no rights over any other Fallout IP, including for example artwork artwork (e.g. weapon art) or game concepts (e.g. the (in)famous "PIP Boy"), all of which Bethesda says it purchased from Interplay in 2007.
The practical effect of that argument (if successful) is that it would make it extremely difficult for Interplay to use much of the previous Fallout games in Fallout Online at all, which would be both a creative and commercial headache for Interplay. Example off the top of my head: Interplay couldn't, for example, just import Megaton (either nuked or not nuked, natch) into Fallout Online, at least as it is shown in Fallout 3 anyway.
(3) Bethesda is also apparently taking other steps to make life difficult for Interplay, including demanding that Interplay provides it with access to its internal Fallout Online design document wiki as part of the litigation (which Interplay is refusing on the basis that it contains trade secrets).
So what?
Drawing all the above together, I think this is what has happened:
Drawing all the above together, I think this is what has happened:
- The reference to Bethesda on the Fallout Online beta sign-up site does not mean that there has been any deal between Bethesda and Interplay. We know this now because the litigation is ongoing: Interplay and Bethesda cooperating over Fallout Online would only make sense if they had settled the lawsuit.
- IF that's right, then Interplay has taken advantage of Bethesda's setbacks in the litigation by forging ahead with Fallout Online as a solo project.
- And, IF that's also right, then Interplay is running a serious gamble that it will win the lawsuit and therefore be able to release Fallout Online itself...
- ...BECAUSE, if Bethesda wins the lawsuit it would in principle have the ability either to shut Fallout Online down or to demand that it be transferred to Bethesda's ownership.
- It would also mean that Bethesda has uncontested control over the Fallout IP in the future.
- Ouch.
That said, it's worth remembering that ultimately all of this remains to be tested in the litigation, so the ownership and the future of the Fallout IP is still undecided.
It also means I've stopped making any predictions about what or may not happen in this case - I'll write another update when there's another turn in this roller coaster...
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[Image source: Wikipedia]
WoW Glider: what actually happened in the courtroom
Last week I wrote an analysis of the Blizzard/WoW Glider case, which got a decent amount of press on the mainstream games sites and led to an awesome debate/flame war/hilarity in the comments to my original post - see here.
One (anonymous) poster wrote up a tongue-in-cheek script for what might have happened in the courtroom, which I liked so much I decided to post it properly below. Enjoy - and if you're the writer of this piece of genius, let me know for credit....
Blizz: ...So in conclusion, please order Michael "Mike" Donnelly to shut down Glider, and also buy us all Yachts. Cuz really, that's what we were gonna do with it anyway. Either that, or nerf rogues.
Judge: I hate rogues too! B*ggers always gank me when I'm afk taking a leak...
Blizz: Well, we DID nerf stealth by making it MUCH easier to detect. Obviously there were complaints, but PR's got it covered with the usual run-around.
Judge: Oh sh*ts, I know SOMEONE who's gonna win a lawsuit if they'd keep a certain class from ever stealthing aga-
Mike: Uh, your honor?
Judge: shut up, Mikey Mike. I'm talking business here. So anyway, this one time I was THIS CLOSE to getting that peacebloom, when I hear that WOOOO, ya know? And then I-
Mike: Your honor, the case?
Judge: FINE, but you BETTER make it a good one, I'm one global away from swinging my Gravel of Justice in favor of Blizz here.
Mike: Thank you, your Honor. Well, ladies and gentlemen of this "supposed" jury, Blizz would like you to believe they made my Glider program illegal. And they make a good case. Hell, I even felt pity myself! But ladies and gentlemen of this "supposed" jury, I have one final piece of evidence for you to consider...
Blizz: (Wait, isn't this a South Park skit?)
Judge: When did that chartboard get here? Warden, did you catch that?
Warden: No, but there's a guy in Diremaul who hasn't logged off in 3 days straight...
Blizz: SEE?! They're RUINING us!1!
Judge: Really? I mean, it's just Diremaul. Honestly, have you guys actually tried to run your own instances? They really suck sometimes.
Blizz: Uh... well, we ARE in the process of streamlining the PVE content in order to re-optimize the percentage of numbers such that they increase with better lateral passing.
Judge: ...oh.
Phoenix Wright: OBJECTION!
Judge: wat
Phoenix: The excuse offered by Blizz doesn't make even the most remote logical sense! It's just words they strung together from what little they remember during the last manager's meeting in Vegas! Furthermore, "lateral passing" isn't even an economics term! It's from football!
Judge: He's gotcha there, Blizz.
Blizz: Oh yea? Well guess what Phoenix? You just lost.
Phoenix: ?
Blizzard: THE GAME! lol
Judge: lol
Phoenix: !!!
Mike: /sigh
Blizz: Hey! That's OUR property there!
Mike: You know what, I give up. I had this wookie I was gonna show and everything, but seriously this is just too stupid. (morons, every one of them)
Judge: You heard the man, he sai- wait.
Blizz: ?
Mike: ?
Judge: ... did he say he had a wookie to show us?
Mike: (Oh, God...)
God: I LOVE WOOKIES
Mike: /facepalm
Blizz: STOP IT! God, make him stop! He's stealing our stuffs!
God: MAN WAS ORIGINALLY SUPPOSED TO BE WOOKIES
Judge: Really? What happened?
God: TEQUILA
Judge: Fair point.
Mike: For the love of... you, please just get me out of here. I can't take this any more.
God: I CANNOT DO THAT HERE
Mike: I know I'm gonna regret this, but... why not, God?
God: I AM OVERBURDENED
Blizz: lol! He's doing the D2 Barb lines!
Judge: lol! His voice is perfect for it too! Do the A1Q1 quest completion line!
God: THE ROGUES ARE SAFE FOR THE MOMENT
Judge: lol
Blizz: lol
Warden: lol
Phoenix: lol
Mike: Fuck it. I'll see you all in appeals. /camp
God: ACTUALLY YOU'LL SEE ME IN 1 DAY 17 HOURS 1 MINUTE 0 SECONDS
Judge: Is that... is that when he's going to die?
God: NO THAT'S WHEN I RENEW MY WOW SUBSCRIPTION
Blizz: Now THERE'S a marketing pitch! "WoW: the only game fit for God!"
God: MY SON PLAYS BEJEWLED
Blizz: we'll talk to Popcap, make it an addon.
God: AND THE LORD SAW IT AND SAID THAT IT WAS GOOD
...And that's how a massive lawsuit between a company and some dude brought about the addition of Bejewled into WoW."
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Thoughts on the WoW Glider appeal
The background
Glider allows players to level up automatically within WoW by playing their avatars for them. It therefore bypasses the level progression built into WoW. Glider was built by MDY Industries, which is owned by Michael Donnelly, who sold it to WoW players for a lot of money. Interesting fact: Donnelly made $3.5m profit off WoW Glider, apparently.
Blizzard did not like Glider, unsurprisingly, and told MDY to stop selling it. MDY then commenced legal action seeking to justify the legality of Glider. In 2008, a California court held against MDY, finding both that Glider involved copyright infringement of WoW and that it contravened the Digital Millenium Copyright Act. That last bit needs a bit of explanation for non-US readers: the DMCA makes it illegal for you to try to circumvent technological protection measures which a software company puts in place to protect its software. In this case the principal protection measure is The Warden, a program that Blizzard uses to track down bots - and which Glider was designed over time to evade.
Having lost the lawsuit, Donnelly and MDY were therefore made subject to a huge $6.5m fine and ordered to stop selling Glider. They appealed - and the judgement from the US 9th Circuit appeal court has now arrived.
Key points from the case
- Blizzard lost its copyright infringement argument. In a nutshell, it argued that its EULA prohibits bot use and therefore, if a player uses Glider, that is a breach of the EULA and constitutes copyright infringement, for which MDY should be legally responsible as it sells Glider in the first place. The court held that in fact using a bot does not involve copyright infringement, it just means a breach of contract (i.e. of the EULA). In other words, using or selling Glider is still illegal because it involves breach of contract, but it's not quite as illegal as Blizzard made out, i.e. copyright infringement. This has important practical consequences, because it significantly limited the legal penalties that Blizzard could seek against MDY. It is also significant legally, because it is the first time that a court has found that using a bot does not involve copyright infringement.
- However, Blizzard won the DMCA argument. The court found, again, that because Glider is specifically designed to evade The Warden, it therefore fell foul of the anti-circumvention laws in the DMCA. Therefore, the court upheld the ban on Glider, even though MDY had 'won' the copyright argument.
- Because Blizzard lost the copyright infringement argument, the court effectively overturned the massive $6.5m fine against Donnelly and MDY. Which must be a relief for them. But it doesn't get them entirely out of the financial wood because...
- Blizzard had also run a 'tortious interference with contract' argument - i.e. it wanted MDY to pay for the damage that Blizzard suffered due to Glider, which appears to have been lost subscriptions. In the lower court, Blizzard won this argument, but the appeal court now basically has ordered a re-trial.
- We'll very likely see this in the courts again, either because of the partial re-trial or because one or both parties attempts to appeal the case up to the US Supreme Court.
- The court affirmed the decision in Vernor v Autodesk earlier this year that games 'owners' in fact only license their games, they do not own them (read more here: what Vernor v Autodesk means for games)
- Blizzard apparently spends "$940,000" a year responding to complaints regarding anti-bot activities (contrast that with the $3.5m profit Donnelly made on Glider sales). Still, I wonder how much extra Blizzard spends on actually combatting the bots themselves.
- Interestingly, MDY's explicit business model was to make it so commercially difficult for Blizzard to continue its anti-bot activities that it would effectively allow Glider to continue.
It might sound like a lot of legalese, but really this is a milestone lawsuit in the games industry:
- It shows yet another weakening of the EULA. Just because Blizzard said that using a bot was illegal and a breach of copyright, didn't actually make it so. Expect more hard looks at the EULA in the future.
- On the other hand, it shows how important the DMCA is to protecting games in the US. The equivalent in the UK is the Copyright, Designs and Patents Act 1988 (you can read more about that here in the context of modchips).
- It also shows that Blizzard really doesn't like bots. Its legal costs must be quite substantial by now and, the court having ordered that each side pay its own costs, it can't recover them from MDY. That's a lot of money to spend going after one bot, but Blizzard must have been banking that it will have a deterrent factor on other bots in the future.
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Image credit: Juanpol/Flickr, via Wired
Kotaku sued over Dante's Inferno picture
Here's an interesting piece courtesy of THR: an artist is suing Gawker, owner of games new site Kotaku, for alleged copyright infringement relating to a painting the artist had done of Dante's Inferno and which Kotaku posted as part of a feature on the EA game called...Dante's Inferno.
The allegedly offending post by Kotaku is here. THR haven't published or referenced any details of the lawsuit, which is brought by the artist Lindsey McCulloch, so treat the above with a grain of salt until there are concrete details of the lawsuit.
However, as a general observation, linking to or posting to other peoples' copyright works on the net is often a bit dicey legally. There's no question that reproducing someone else's paintings constitutes 'copying' under the copyright laws of most jurisdictions, but where different countries take very widely different positions is to what extent that copying is legally permitted and when it turns into (illegal) copyright infringement.
For example, in the USA there is a fairly wide legal principle of "fair use", which (partly for freedom of expression reasons) protects a wide ranging of copying which otherwise would constitute copyright infringement. However, in the UK there is no such general concept of fair use and instead you have to try to rely upon much more limited categories of protection, such as the 'research' or 'news reporting' defences to copyright infringement. In most countries of course, what is really important is why you are copying someone else's copyright works: is it for your own commercial benefit? Have you given due credit to the original author?
Or to boil all that down even further: there is no one size fits all rule about when you can copy someone else's work on the net (or anywhere else), and when you can't.
Postscript: some people on the internets have already speculated why the artist isn't taking action against EA for somehow copying her work when they published the Dante's Inferno game itself. All I will say about that is that, very generally, it can be straightforward to 'copy' someone else's work in your game if you do it properly - there's a lot more on that here.
Second postscript: for once, I have not linked a picture for this post. I wonder why?
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The allegedly offending post by Kotaku is here. THR haven't published or referenced any details of the lawsuit, which is brought by the artist Lindsey McCulloch, so treat the above with a grain of salt until there are concrete details of the lawsuit.
However, as a general observation, linking to or posting to other peoples' copyright works on the net is often a bit dicey legally. There's no question that reproducing someone else's paintings constitutes 'copying' under the copyright laws of most jurisdictions, but where different countries take very widely different positions is to what extent that copying is legally permitted and when it turns into (illegal) copyright infringement.
For example, in the USA there is a fairly wide legal principle of "fair use", which (partly for freedom of expression reasons) protects a wide ranging of copying which otherwise would constitute copyright infringement. However, in the UK there is no such general concept of fair use and instead you have to try to rely upon much more limited categories of protection, such as the 'research' or 'news reporting' defences to copyright infringement. In most countries of course, what is really important is why you are copying someone else's copyright works: is it for your own commercial benefit? Have you given due credit to the original author?
Or to boil all that down even further: there is no one size fits all rule about when you can copy someone else's work on the net (or anywhere else), and when you can't.
Postscript: some people on the internets have already speculated why the artist isn't taking action against EA for somehow copying her work when they published the Dante's Inferno game itself. All I will say about that is that, very generally, it can be straightforward to 'copy' someone else's work in your game if you do it properly - there's a lot more on that here.
Second postscript: for once, I have not linked a picture for this post. I wonder why?
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