We Can Pick The Game, But We Cannot Change The Rules — Intellectual Property Rights vs. The First Amendment in the Video Game Industry

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Spencer Martinez of VideoGamerLaw.com

Video games remain the most prolific purchased entertainment product of the 21st Century, now rivaling or surpassing industry revenue for movies, DVDs, and recorded music in certain world markets. Forbes reports that global revenue from the video game industry will likely surpass $82 Billion by 2017—an exponential increase, and likely a conservative projection now that industry heavy-hitters are finally beginning to unveil their new game consoles.

This market boom, and economic rivalry with more “traditional” entertainment, is hardly a surprising byproduct of the rapid evolution of video games themselves as an entertainment medium. Video games are increasingly realistic, and increasingly cinematic. They tell a story. They employ skillful direction and adept “camerawork.” Characters are often brought to life through “motion capture” of real life performers and professional voice talent, including A-listers such as Samuel L. Jackson (Grand Theft Auto), Liam Neeson (Fallout 3), and Bill Murray (Call of Duty: Modern Warfare), to name but a few.

In this growing and perpetually evolving entertainment industry, video game publishers need to be increasingly cognizant of the intellectual property ramifications of their content, their characters, and their inspirations. Publishers are entitled to new expression through new titles. The law imposes limitations on that expression, however, particularly in the form of third-party intellectual property rights. This article summarizes the balance struck by the Courts, and the basic “rules” of this game.

COPYRIGHTS AND TRADEMARKS: THE COURTS’ MORE EXPANSIVE VIEW OF PERMISSIBLE NEW EXPRESSION.

The law recognizes video games as an art form, or in legal parlance, a form of “creative expression.” As such, they are a form of free speech protected by the First Amendment.2

It follows that—as with music or literature—Courts are often called upon to balance two competing interests where infringement of others’ intellectual property rights is alleged: (1) A video game publisher’s legitimate interest in protecting its intellectual property; and (2) a subsequent video game developer’s right to create, free from the threat of infringement litigation.

Copyrights—You Shoot A Zombie In The Head, No Matter Where You Find It.

Courts seem to take an increasingly liberal view of new expression as against existing copyrights. Original artwork, sounds, characters, movements, animation sequences, and other expression in video games is generally copyrightable subject matter. Whether a new game appears to be a knock-off of an existing game or franchise is hardly the sole inquiry in an action for copyright infringement, however— even where the game-consuming public decries a new game as a patent rip-off. (In August 2012, Electronic Arts Inc. sued Zynga Inc. in California for copyright infringement, alleging that Zynga’s Facebook game The Ville virtually replicated The Sims Social, EA’s Facebook application of its highly successful The Sims franchise. The Complaint cited numerous gaming websites and other media condemning The Ville as an obvious clone of The Sims Social, and denounced Zynga as a habitual game plagiarist.3)

Copyright protects new and original “expression,” but does not protect “ideas.” Similarly, copyrights do not extend to facts, historical events, or matters that are typical or unavoidable in the expression of an idea— termed “scenes-a-faire.” A copyrighted tournament karate video game, for example, does not preclude new karate video games where the competitors also wear ghis, face off with kicks, blocks and punches, and compete in a “Karate Kid”-type tournament setting. Such attributes are “ideas” or “scenes-a-faire” inherent in the sport of karate, and cannot be monopolized.

In the specific context of video games, Courts have acknowledged their difficulty parsing copyrightable new expression from uncopyrightable “ideas” and subject matter. Perhaps not surprisingly, Courts often play it safe. In 2008, for example, a federal court in California dismissed claims that the Capcom Co, Ltd. video game Dead Rising infringed plaintiff’s copyrights in the 1979 horror film George A. Romero’s Dawn of the Dead. There were notable similarities–for example: (1) the setting—a bi-level shopping mall; (2) the story’s beginning: a helicopter drops the main characters at a mall besieged by zombies; (3) key attributes of certain main characters; (4) zombies in plaid shirts; (5) creative weaponry such as propane tanks and chain saws; (6) piped-in “mall music” (for comedic effect), and (7) the parody message—rampant American consumerism, enduring even after death. The Court nevertheless found no infringement, concluding in pertinent part that the parallels between the two works were “driven by the unprotectable concept of humans battling zombies in a shopping mall during a zombie outbreak.”4

More recently, in 2012 a federal court in Washington considered a motion to dismiss claims by video game publisher Spry Fox, LLC that the game Yeti Town infringed Spry Fox’s copyrights in its own game Triple Town. Yeti Town was widely condemned by media and bloggers as an obvious knock-off of Triple Town. Indeed, the dispute allegedly began when the defendants reneged on its agreement with Spry Fox to develop Triple Town for the iOS operating system, and thereafter released Yeti Town in the same format. The Court noted that “similarities pervade the games” from their rules to visual appearance, but largely eviscerated Spry Fox’s copyright claims as unprotectable ideas (vs. expression) and “scenes a- faire” to the game genre.5 The case settled shortly afterwards.

As in Spry Fox, the EA/ Sims Social complaint likewise included “damning” side-by-side-illustrations and citations to pervasive gamer sentiment that there had been foul play. A finding for EA was nevertheless by no means assured had the matter not promptly settled.

Trademarks—Neon Lights And Platform Shoes Pervade Most Gentleman’s Clubs

When a trademark appears in an expressive work, Courts again weigh the trademark owner’s rights against the publisher’s First Amendment right to free expression—with the law, again, tending to favor creative expression.

Under prevailing law, the use of a trademark in an expressive work is generally not actionable infringement if two conditions are satisfied: (1) the trademark has some artistic relevance to the work, and (2) the use does not “explicitly mislead” as to the source or content of the work.6 These conditions are often easily satisfied. A trademark has “artistic relevance” to an expressive work if the relevance is anything greater than zero. Rogers, at 999 (threshold is “no artistic relevance to the underlying work whatsoever.“) Use of a trademark is not “explicitly misleading” unless it is an “explicit misstatement, “overt claim,” or “explicit indication” as to the trademark holder’s endorsement or sponsorship of the expressive work—i.e., the song, movie, etc. in which the mark appears. Applying this test, even pervasive reference to a protected trademark in an expressive work has been held non-infringing. (Plaintiff Mattel, Inc.’s trademark claims relating to the 90s pop song “Barbie Girl” were dismissed under the Rogers test, even though the trademark “Barbie” pervaded the song.7)

In the Rockstar Games, Inc. video game Grand Theft Auto: San Andreas, the game protagonist completes “missions” and advances the storyline while navigating several virtual cities–including “Los Santos,” a city based on Los Angeles and which mirrors actual Los Angeles landmarks and businesses. In 2005, ESS Entertainment 2000, Inc. (the corporate operator of the “Play Pen,” a Los Angeles gentleman’s club) sued Rockstar Games in California, alleging that Rockstar’s depiction in the game of a gentlemen’s club called the “Pig Pen” infringed ESS’s protected trademarks and trade dress. Significantly, Rockstar Games admittedly drew artistic inspiration for the Pig Pen from photographs of the Play Pen taken by its employees.

The Court nevertheless found Rockstar’s use of ESS’s business features protected by the First Amendment. Applying the Rogers test, (1) Rockstar’s colorable recreation of the Play Pen had “some artistic relevance” to the game; and (2) Rockstar’s use of ESS’s trademarks and/or trade dress was not “explicitly misleading” as to ESS’s role in the game: “Nothing indicates that the buying public would reasonably have believed that ESS produced a video game or, for that matter, that Rockstar operated a strip club.” Moreover, nothing before the Court suggested that a player would think ESS had lended its expertise, support, or ”strip-club” knowledge to the production of the game. Upon these findings, the Court affirmed dismissal of ESS’s case. (The Court was unswayed by ESS’s argument that players could forego regular game play to linger at the allegedly infringing “Pig Pen.”)8

It is difficult to imagine a Court abrogating video game content in favor of trademark rights when applying this forgiving standard, except perhaps where the protected mark dominates the game or promotion. (A Federal court in California recently declined to dismiss Lanham Act claims against Electronic Arts over the appearance of the claimant’s helicopters in the combat simulation game Battlefield 3, where the claimant alleged the helicopters were given particular prominence in the game and were featured in the game’s advertising. In the Court’s view, these allegations were sufficient to support the inference that consumers were misled as to whether claimant somehow “sponsored” the game. See Electronic Arts, Inc. v. Textron, Inc. (N.D. Cal. 2012).) In most first-person shooters and other game genres, this seems an atypical circumstance.

RIGHTS OF PUBLICITY: THE COURT’S MORE RESTRICTIVE VIEW. Permissible new expression in video games seems more narrowly circumscribed when weighed against individual rights of publicity—i.e., the right of an individual to control the commercial use of his or her own likeness and persona.

The law of most states provides that the use or appropriation of one’s likeness without permission for commercial purposes is unlawful, and gives rise to legally cognizable injury. (See, e.g., California Civil Code §3344.) Video game publishers are not exempt. Using a celebrity’s likeness in a video game invariably fits the legal definition of “commercial purpose,” and Courts have repeatedly recognized the strong financial incentive of a video game publisher to do so: It is inevitably more fun for a 49er fan to “be” Colin Kaepernick than an anonymous quarterback in a red jersey.

Video game content is still protected “expression,” however, and Courts therefore again apply a balancing test.

The Transformative Use Defense—We Want To Be Gwen Stefani.

In California and elsewhere, this test is the “transformative use” test: If the work is “a literal depiction or reflection of a celebrity for commercial gain, directly trespassing on the right of publicity without adding significant expression,” the celebrity’s publicity rights outweigh the artist’s expressive interests. On the other hand, if “added creative elements significantly transform the celebrity depiction,” the First Amendment trumps state law publicity rights.9  By way of example, a celebrity’s literal charcoal portrait is not sufficiently “transformative.” By contrast, a space alien character that incorporates recognizable attributes of 90s pop star Dee-Lite is protected expression.

Right of publicity litigation is an increasingly prolific byproduct of video game development technology that is now so advanced, real-life individuals can be replicated down to athletic build, swagger, facial tics, and distinguishing marks. Any video game invariably incorporates some degree of “new expression.” The law nevertheless favors celebrities’ publicity rights where they are literally reproduced in a game, doing the very thing that made them famous. In 2010, a federal district court in California declined to dismiss former Arizona State University quarterback Samuel Keller’s publicity claims against Electronic Arts, finding EA’s depiction of Keller in NCAA Football was “not sufficiently transformative” to sustain a First Amendment defense. (EA argued—unsuccessfully—that the Court should weigh the whole of the video game, and not just Keller’s player avatar.)10 In 2011, and similarly, a California court declined to dismiss No Doubt’s claims against Activision Publishing, Inc. over the band’s depiction in the game Band Hero. Activision asserted that the game was sufficiently “transformative,” because the video game depicted the No Doubt avatars “surrounded by unique, creative elements” and performing songs No Doubt “avowedly would never perform in real life.” The Court disagreed, noting that No Doubt’s literal depiction in the game was patently intended to appeal to No Doubt fans who wanted to “be” or play alongside No Doubt.

The Evolution Of Publicity Rights—Blood Feuds, Body Art, And New Law Upon Old Principles.

Rascalov’s postulate in Grand Theft Auto—“We can pick the game, but we cannot change the rules”— was for the most part correct. However, it ignores a corollary that is ever-present in the law: While the rules generally stay the same, their application often evolves. In the video game arena, this evolution seems to come increasingly in the form of original (and often counterintuitive) litigation by third parties.

In 2010, Guns N’ Roses frontman Axl Rose sued Activision Blizzard, Inc., alleging that defendants wrongfully failed to disclose their inclusion of former Guns N’ Roses guitarist Saul Hudson (aka “Slash”) and his band Velvet Revolver in Guitar Hero III—a game for which Rose had licensed Guns N’ Roses music to Activision. Rose was not himself depicted in the game. Couched as an action for breach of contract and fraud, the lawsuit was ultimately resolved against Rose. The action nevertheless highlights a possible species of right of publicity claim in video games: Where the depiction of a celebrity, otherwise agreeable and legally permitted as a matter of contract or free expression, becomes “objectionable” because others appear in the game.

The THQ Inc. mixed martial arts titles UFC Undisputed 2010 and UFC Undisputed 3 allow players to fight as UFC Welterweight Champion Carlos Condit. Condit’s appearance in the game is no doubt pursuant to express license with Condit, and is otherwise proper on its face. In November 2012, however, THQ was sued in Arizona federal district court for copyright infringement—by the tattoo artist who applied the elaborate lion tattoo to Condit’s ribcage, which tattoo appears on Condit’s game avatar. This lawsuit remains pending. Another tattoo artist recently commenced similar litigation in Louisiana against Electronic Arts—no doubt inspired by the THQ lawsuit and the tattoo artist/plaintiff’s conspicuous success in the 2011 “Hangover 2/ Mike Tyson tattoo” litigation. These or other Courts will ultimately be called upon to weigh three competing interests: (1) game publishers’ expressive rights, (2) athletes’ rights of publicity, and (3) tattoo artists’ copyrights, which the Tyson court found solid. As of today, the balance is unresolved.

Game developers and publishers are invariably mindful of the basic rules. Going forward, game publishers should nevertheless bear in mind that potential legal claims—like new game titles—often reflect creativity and imagination, and can come as a surprise.

Endnotes

1 Dimitri Rascalov, Grand Theft Auto IV. 2 The United States Supreme Court recently considered a First Amendment challenge to a California statute prohibiting the sale or rental of “violent video games” to minors. In finding the statute unconstitutional, the Supreme Court held in pertinent part: “Like the protected books, plays and movies that preceded them, video games communicate ideas—and even social messages—through many familiar literary devices (such as characters, dialogue, plot and music) and through features distinctive to the medium (such as the player’s interaction with the virtual world). That suffices to confer First Amendment protection.” Brown v. Entertainment Merchants Ass’n, 131 S.Ct. 2729, 2733 (2011). 3 Electronic Arts Inc. v. Zynga Inc., N.D. Cal. Case No. 3:12-cv-04099 (Complaint filed Aug. 3, 2012.) 4 Capcom Co., Ltd. v. The MKR Group, Inc., 2008 U.S. Dist. Ct. LEXIS 83836 (N.D. Cal. 2008), at * 21- 22. 5 Spry Foxx, LLC v. LOLApps,, Inc., 2012 U.S. Dist. LEXIS 153863 (W.D. Wash. 2012), at *13-15. 6 Rogers v. Grimaldi, 875 F.2d 994, 999 (2d. Cir. 1989) 7 See Mattel, Inc. v. MCA Records, Inc. 296 F.3d 894, 902 (2002). 8 E.S.S. Entm’t 2000, Inc. v. Rock Star Videos Inc., 547 F.3d 1095, 1101 (9th Cir. 2008). 9 Comedy III Productions, Inc. v. Gary Saderup, Inc., 25 Cal.4th 387, 391 (2001). 10 But see Hart v. Electronic Arts, Inc. , 808 F. Supp.2d 757 (2011) (finding upon virtually identical facts that Electronic Arts’ First Amendment rights outweigh Plaintiff’s New Jersey publicity rights under the ”transformative use” test, because game permits manipulation and alteration of “virtual player’s” physical characteristics, teammates, and surroundings.)