Games Law Update: May 2012

Hi everyone – sorry for a delayed May games law update.  Blame the Queen’s Diamond Jubilee which gave us a 2 day national holiday here in the UK (maybe it’s disloyal to blame the Queen? Oh well).  Here goes:

  • The Japanese government has announced its intention to regulate ‘gacha’, a virtual goods sales models.  Here’s some thoughts from me on it.
  • The Australian government intends to investigate software pricing, including games in the Australian market.  I’ve been hearing from readers of this blog for some time that Australian games prices are too high relative to their price in other markets – clearly the Australian government has decided to look into this.  Interestingly, reports it will include Apple – which can only mean that mobile apps will be included in the investigation.
  • In the EU, there has been an interesting case regarding the legality of second hand sales of digital software licences.  I wrote about it here.
  • Torrentfreak reports on a New York case involving a judge pouring scorn on the idea that an IP address can identify a specific person to the extent that legal action against them can be brought (or, put another way, the judge agreed with the commonly brought argument against IP address tracing, i.e. it doesn’t tell you anything about who is actually at the terminal).
  • Following a long legal battle, the English High Court ordered 5 UK ISPs to block access to the Pirate Bay on the basis that it facilitates copyright infringement.  The ISPs had refused earlier requests by rights holders to block access to TPM, which had forced this litigation in the first place.  It’s an open question at the moment as to what extent rights holders will use this precedent to try to shut down similar sites via court action rather than arguing for the legislature to give them statutory powers (attempts along that line came into difficulties following the passage of the Digital Economy Act 2010).
  • Motorola and Microsoft are embroiled in a series of patent infringement battles that *could* result in a US ban on the import of Xbox 360s.  Florian Mueller has further updates on this story since I last wrote about it, so check out his blog here.
  • More news about erstwhile Stargate Worlds developer Cheyenne Mountain Entertainment, which went into Chapter 11 back in 2010: an investor has commenced legal action against a number of defendants, including former CME Chairman and CEO Gary Whiting.
  • Yet more celebrity lawsuits in the games industry: a Manhattan judge has permitted a games developer to pursue a lawsuit against Beyoncé.  Apparently, “the company, Gate Five, claims the superstar backed out of a $20 million deal for a game called “Starpower: Beyonce.”
  • No buyer for Game Australia has been found and it has now gone into administration.
  • Valve and Blizzard have decided to bury the hatchet over their DOTA 2 trademark dispute.  I wrote about this way back in October 2010 originally, when I predicted that the two games developers creating two similar games both called DOTA would bring them into collision – which it did.  Fortunately, it sounds like they have been able to reach a co-existence agreement of some kind with each other.  The terms are, as you’d expect, confidential, but it sounds like Blizzard has agreed not to call its game DOTA but instead “Blizzard All-Stars”.  
  • A complicated-sounding trademark infringement lawsuit has been commenced by Novalogic against Activision, Microsoft and Turtle Beach.  Novalogic, maker of a series of ‘Delta Force’ branded games argues that each of the three defendants have infringed its trade mark in ‘Delta Force’ in different ways (e.g. Activision through its inclusion of the Delta Force name and logo in Modern Warfare 3, Turtle Beach through similar activity regarding its games peripherals).  The potentially complicating factor is that Delta Force itself is (reputedly) a branch of the US Armed Forces which the government refuses to acknowledge exists.  Query what impact (if any?) that has on the validity of Novalogic’s argument?  Then ofc there are the standard arguments as to whether there’s actually been infringement or not (read my quick guide to trade marks here on that front).
  • Bethesda has issued a cease and desist letter to an app developer who created a map app for Elder Scrolls: Skyrim.  No news from what’s been reported so far about on what precise legal basis Bethesda issued the demand.  For his part, the developer claims that he hand-drew the map rather than copied existing Bethesda assets – if true, that suggests there could be a complicated non-literaly copying issue here.  Ofc, if the app contains trade marked phrases or logos, then that could the route forward for the cease and desist letter.  On the plus side, reading about this article led to me finding about that Bethesda has sought to trade markFus Ro Dah” among other Skyrim phrases.  Nice…
  • A rather unusual lawsuit here: US City National Bank is suing Konami and Autumn Games accusing them of failing to repay a loan made by the bank to part fund the development of Def Jam Rapstar.  Very seldom that these kinds of lawsuits take place (or at least become public).  No word from the defendants yet, but this sounds like a dispute about the terms of the loan agreement and under what circumstances the loan would be repayable.
  • The Korean Fair Trade Commission is to investigate South Korean gaming giant Nexon over its takeover of Taiwanese company Gemania.
  • The UK’s premium rate phone number regulator, PhonePayPlus, which also has jurisdiction over mobile apps, has issued what Develop rightly calls a “landmark” decision imposing fines on two Android apps that involved users being charged without their knowledge or authorisation.  More about this in a blog post soon…
  • And lastly, I wrote on Edge about a day in the life of a games lawyer.

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