Atari sues Tommo for $30m over Flashback 2 console

This is interesting:  Atari is suing Tommo Video Games Distribution in the US in a $30 million claim over the Atari Flashback 2, according to Kidscreen.  Details are very sparse at the moment but the allegation seems to be that Tommo is selling or distributing a counterfeit version of Atari’s Flashback 2 console, which I understand is itself is a repackaged version of Atari’s famous Atari 2600 console released in 2010.

I wanted to blog about this for two reasons:

(1) A quick recap about counterfeit goods.

Counterfeit goods are simply knock offs – goods which are manfactured to look, feel and operate like your goods but which are actually made by a rival third party.  Because counterfeit goods are made without your authorisation, they infringe just about every intellectual property right that you may own in the original goods.  In this case, IF Tommo is indeed manufacturing and marketing a counterfeit Flashback 2 without Atari’s authorisation (which remains to be proven), then in principle it may be infringing Atari’s copyright, trade marks, design rights and patents in particular.  If there was an agreement between Tommo and Atari for the manufacture of the Flashback 2 and Tommo has gone outside that contract, then Tommo may in principle also be liable for breach of contract. 

Consumers also are heavily affected by counterfeit goods, since they may be purchasing these goods without realising that they’re not genuine – and therefore they’re not getting the ‘real thing’ (in fact, they may be receiving technically inferior goods).  Depending on what country consumers are in, their national consumer protection laws may help them to different degrees.  For example, in the UK a consumer would under the right circumstances have a right to return counterfeit goods to the seller (not the manfacturer) and demand a refund under the Sale of Goods Act 1979.

(2) The Flashback 2 isn’t exactly new technology.

I was struck by the fact that the Flashback 2, which depends on Atari 2600 technology, basically goes back right to the start of the modern games industry.  And yet Atari is reportedly commencing a $30 million action over that technology.  It just goes to show that games businesses shouldn’t discount the value of their old hardware or IP too lightly – Atari clearly saw a market opportunity to bring their old console back and are now having to take legal action to preserve it.

Top tips:

  • Consider whether there’s an opportunity to make money out of your old hardware or IP again (e.g. through a licence or re-release, maybe on one of the new platforms like Steam or iOS)
  • This is critical: review your legal protection of your old IP.  Have you maintained protection of their copyright/trade marks/patents?  It won’t be expensive to take remedial action, but you never know when it might come in handy.
  • Look at third party hardware and IP.  Has it become abandonware and, if so, could you do something with it?  NB that means getting a licence, not just charging in and using it without authorisation (I’ll be writing about the legality of abadonware soon…)

Image credit: Atari/CNET

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