What does UK IP reform mean for the games industry?

This is a guest post by my friend and fellow lawyer, Jonny Mayner. IP law is pretty important to the games industry, since it governs the stuff that games are (legally) made of. Being a clever IP expert as he is, I thought I’d ask him to explain what the UK government is doing to update IP law…

Earlier this year the UK Government tasked a chap called Professor Ian Hargreaves with the unenviable job of reviewing the state of Intellectual Property law in the UK. The key question posed by the Government was “Could it be true that laws designed more than three centuries ago with the express purpose of creating economic incentives for innovation by protecting creators’ rights are today obstructing innovation and economic growth?”.

Professor Hargreaves’ answer ran to around 100 pages plus annexes, glossaries and extensive footnotes, but as he helpfully stated in his foreword “The short answer is: yes.” [Jas: plus you can add to that the various shouting going on around the music, film and tech industries about whether IP law is fit for purpose anymore- like Larry Page’s alleged claims to UK Prime Minister David Cameron that Google couldn’t have been made in the UK due to its antiquated IP laws]

So what to do? Well, helpfully Professor Hargreaves made some recommendations on that front and in recent months the government, mostly through the agency of the Intellectual Property Office (IPO), has issued various consultations and reports on proposals for reform.

Read on for a summary of the current state of play and what they might mean for the games industry:

Copyright:

(1) Establishing a licencing and clearance system for orphan works – so that old IP can be put to further commercial and non-commercial use (orphaned works are copyright works where you can’t work out who the owner is after a “dilligent search”).

How useful is this going to be for games? We really don’t know, but it seems less likely to be useful for games than it will for e.g. music or film. The reason for this is that, when it comes to an IP which could be turned into a game (eg a great classic book or a film) we’d guess you’ll usually be able to work out who the owner is – so no issue of orphaned works arises. Plus, it’s important to distinguish orphan works from abandonware: just because a title is no longer being commercially exploited (i.e. abandoned) by its copyright owner does not mean that it has been orphaned.

That said, maybe we’re wrong. If any of you devs have wanted to make a game from an existing IP but couldn’t find the owner, email us!

(2) Creating a private copying exception in copyright law – so you can e.g. carry on burning your CDs to iTunes without fear of being sued for it. Given that games tend to be platform-specific, allowing for format shifting of this type is not likely to impact the games world too much. That said, depending on how broadly the reform is drafted it may provide consumers with wider rights to copy their games than before. With that in mind it may be important for the games industry to make its voice heard in the consultation period lest the new law bring any nasty surprises.

(3) Creating a parody exception in copyright law – so that po-faced rights owners who can’t see the joke can’t sue under copyright law (at the moment, if you create a parody of a copyright work, you can be sued for copyright infringement even though you’re trying to make a point for parody value, not actually copy/make money from the original). That always seemed like a silly state of legal affairs, but this reform should sort it out.

This reform will be good news for comedians, but I’m not sure if it will have much impact on the games industry- mainly because games don’t really involve much parody. Still, it’s worth knowing if you did decide go incorporate parody into your game that- eventually- it’ll be legally ok in principle (though, as always, there’ll probably be legal complications, eg you might intend a parody by making Chronic the World’s Slowest Hedgehog, but if you sell it for money you may still get caught out by trade mark law…)

(4) Preventing the use of contracts to overcome exceptions to copyright law – so that a publisher can’t restrict users’ statutory rights (including any new private copying right) by imposing restrictions in an EULA. This has the potential to introduce several changes to the drafting of EULAs, so watch this space…

Patents:

(1) Examining patent thickets as a possible barrier to market entry for small and medium sized businesses – a patent thicket is described in the IPO’s preliminary report on the issue as “a dense web of overlapping intellectual property rights that a company must hack its way through in order to actually commercialize new technology”. The report is sparse on specific proposals for reform and it raises more questions than it answers, but the fact that the government is looking at this at all may be of interest to games industry stakeholders of all sizes.

General: an evidence-based approach to future IP reform

One of the most important changes proposed by the Hargreaves review was a move to an evidenced-based approach to IP reform. On other words, we should only change IP law in response to issues that have been factually demonstrated to be real issues. Issues which people claim are issues, but which they can’t factually prove to be issues, don’t deserve legal change. Consider what that would mean for various changes to IP law to combat issues like content piracy in the past (answer: many of them would I suspect not become law, because demonstrating the financial impact of piracy and why it needs a LEGAL solution is infamously hard).

Professor Hargreaves clearly hoped the government would take this on board and therefore be cautious when it comes to future IP law change – here’s hoping…

Next steps:

So what next? Well, the Government’s consultation on copyright reform is open for responses until March 2012, so the games industry has until then to make its views known. On the patents front the IPO’s report also moots the possibility of a consultation to gauge industry appetite for reform or views on any specific proposals.

What ISN’T being discussed:

The list is as long as your arm, but examples include:

– No general fair use defence to IP infringement
– No discussion of whether the current copyright term (generally 70 years after author’s death)
– No proposals regarding cutting edge IP issues like legal treatment of user generated content or virtual goods
– No proposals to deal with patent trolls
– No proposed clarification regarding complicated issues like when a piece of content (eg a game)is a cloned from or ‘inspired by’ an original

Some of these matters aren’t being dealt with because the UK government can’t do it without accompanying EU legal change; others because the government just doesn’t consider them sufficiently important yet. Some are more for courts than the government because they require interpretation of existing law, not new law. Unfortunately, these are some of the most important issues as far as the games industry is concerned.

As a result, our conclusion regarding the impact of the UK government’s legal proposals on the games industry is: not that much, really. Which is a shame (although, given the games industry had by far the least involvement in IP reform compared to the other creative industries, that’s maybe not a surprise).

Anyway, we’re still at the consultation stage regarding these reforms, and there will be a lot more reform required over the next few years one way or the other. As always, watch this space for any developments that will affect the games world…