Category: Gaming Law

Video Game Preservation: Not a DIY Project, But Now A Lawful One

(This post was originally written for Ron Coleman’s Likelihood of Confusion blog. Please note that while the author is a licensed and experienced attorney, nothing in this post constitutes specific legal advice. It is provided for general educational purposes only. The author has made an offer of pro bono consultation related to the subject matter of this post. This may be considered ATTORNEY ADVERTISING in some jurisdictions.)

If you are into vintage video games, you probably know about “ROM Sites.” ROM sites are websites where you can download the ROM (Read Only Memory) code for classic cartridge or board-level games, such as Nintendo Entertainment System cartridges or arcade cabinet games like “Spy Hunter.” They’re not really different in kind from websites or torrents where you can download more modern software which was available on disk or CD-ROM. They’re just a little more arcane because you have to not only download the ROM code (which has been “ripped,” or copied from the ROM chips to a computer hard drive) but download and run “emulator” software, which allows your modern PC to run code written for much, much older hardware. It’s entirely doable, but requires a little effort and tech know-how.

Recently, Nintendo sued one of the better known ROM sites, loveroms.com, and won a 12 million dollar judgment against them for copyright infringement. Here’s a copy of what was the front page of loveroms.com from the complaint:

Here’s what’s on the loveroms.com front page now:

Apology to Nintendo

Our website, LoveROMS.com/LoveRetro.co, previously offered and performed unauthorized copies of Nintendo games, in violation of Nintendo’s copyrights and trademarks. LoveROMS.com/LoveRetro.co acknowledges that it caused harm to Nintendo, its partners, and customers by offering infringing copies of Nintendo games and has agreed to cease all such activities. To access legitimate Nintendo games online, please visit www.nintendo.com for information about the Nintendo Game Store.

Continue reading Video Game Preservation: Not a DIY Project, But Now A Lawful One

TwitchCon 2018!

A very sharp young lawyer (well, she’s waiting for her bar results but I have confidence) who goes by LadyLawTM on the Internet invited me to speak on a panel she wanted to do on lootboxes, games, and gambling at TwitchCon this year. I like talking, I like cons, and I Have Opinions, so of course I said yes. It was this past weekend and I thought I’d just share a few of the highlights with you. 🙂

Note: There is a list of all the streamers I met (and whose gamertags I got) at the bottom of this entry. Please check them out! If I missed you, so sorry, please comment and I’ll add you.

First, I am happy to report that our panel was a smashing success. The description is here, and here’s a VOD of our panel!

Continue reading TwitchCon 2018!

Gaming, Gambling, And I-Told-You-So’s

So on March 28, 2018, the Ninth Circuit Court of Appeals issued this opinion:

Kater v. Downs

It has been all over the Interwebs, but there’s a lot of misunderstanding going on. I happen to have not only some experience in gaming law, but experience in dealing with the particular statute in question, Wash. Rev. Code § 9.46.0237, the “unlawful gambling” law in the state of Washington. From experience, I can tell you that it is one of the broadest gambling laws in the country. The Ninth Circuit takes special note of this, especially when it finds citations to decisions on the law of other states unpersuasive.

So, in no particular order, some observations and clarifications:

This case was originally brought in a Federal District Court. While there are Federal gambling laws, most cases of actual interpersonal acts that might be gambling are subject to state laws. There’s not really a Federal law that governs acts of gambling in a general manner. The case was brought in Federal court because it is a class action against Churchill Downs, which is a corporation resident in Kentucky, and the class, with the representative plaintiff being Ms. Cheryl Kater, a resident of Washington. This is allowed because of what is called “diversity” jurisdiction: people who live in different states can bring suit in Federal courts because it’s viewed as fairer for both parties to have diverse lawsuits brought in a Federal court under a single Federal civil procedure and with a hopefully less biased court.
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But, as I said, there are no Federal gambling laws that apply: the plaintiff is suing under a state gambling law. Federal courts hear cases under state law all the time. The reason Washington’s law applies is that the alleged gambling took place, at least in part, in Washington (where Ms. Kater’s device was) and by offering the service to her in that state, Churchill Downs may have made itself subject to the laws of her state. (That’s a whole separate discussion which I will not get into.)
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Now that we know how she got there, here’s what Ms. Kater is claiming:a) Washington’s state gambling law says that people who take money to provide illegal gambling services aren’t allowed to keep it: the person who gave it to them can sue in civil court to get it back.
b) Under Washington law, the game Churchill Downs, under the name of software publisher Big Fish Casino, was illegal gambling.

c) Ms. Kater gave Big Fish Casino a lot of money (at least a thousand dollars) to play in Big Fish Casino. Other people in the class likewise paid money to play at the casino and it was gambling too.

d) Therefore, she and all other similarly situated members of the class (people in Washington who played in the casino and paid money to do so) should get their money back.

Whew! Let’s unpack that a little bit.

As far as “people can get their money back if they lost it gambling illegally,” that is actually a pretty common rule. You may like it, you may not think it makes any sense. But it is what it is and I’m not going to discuss that other than to say that that’s the rule here and in many other places.

As far as “she gave them a lot of money to play,” you can have whatever opinion you want as to what that says about her intelligence, impulse control, etc. I will say that these games are designed by psychologists to be pure dopamine generators. I doubt many people reading this aren’t familiar with being sucked into a game: imagine that feeling, only with actual SCIENCE! applied to trying to generate it. I think regulated gaming should be legal for informed adults, but I am not blind to this kind of thing.

But now we get to the heart of the matter: was this game unlawful gambling? You may know, especially if you read my blog, that the crime of gambling usually consists of three elements: consideration (which is your stake, your wager, the thing you put at risk to play,) chance (the outcome of the play has to be outside your control in some way, usually by way of a random event,) and prize (you have to be able to win something of value.) We definitely have consideration: while you can initially get play points by various unpaid means, you eventually have to buy them, and you can’t play if you don’t have play points. We likewise have chance: the games she played are literally video slot games which use a random number generator to determine whether the player wins any particular game played.

But do we have a prize? Is there a thing of value?

NOW PAY ATTENTION BECAUSE I’VE BEEN TRYING TO WARN YOU PEOPLE AND NOBODY WANTS TO LISTEN.

Here is the definition of “thing of value” under Washington law:

[A]ny money or property, any token, object or article exchangeable for money or property, or any form of credit or promise, directly or indirectly, contemplating transfer of money or property or of any interest therein, or involving extension of a service, entertainment or a privilege of playing at a game or scheme without charge. Wash. Rev. Code § 9.46.0285

It doesn’t limit “things of value” to money or things that can be exchanged for money. While allegedly there was a black market for play points that involved using external payments for play points to then be exchanged in-game (with a cut for Big Fish, which does NOT look good) the lower court specifically said that that was a violation of the TOS and it wasn’t relevant anyway. Because play points are the embodiment of a privilege of playing at a game or scheme without charge.

BOOM HEADSHOT

This, by the way, is a historical artifact related to pinball machines and “clear” or “reset” switches. Back in the olden days, if you won free credits on a pinball machine, the bartender could hit the reset switch and clear the credits, and pay you what they were worth. This was considered gambling under the anti-pinball moral panic of the day, so it was made illegal in many jurisdictions. Whether or not a game has a reset switch is often crucial to determining whether it is an unlawful gambling device or a lawful entertainment device.

But I digress.

The point is, prizes, or things of value, are what the law says they are, not what you think they are. This varies by jurisdiction and it is incredibly complicated. If you want to make a game that arguably has the three elements of gambling *cough*lootboxes*cough* but defend yourself from possible charges of gambling by claiming your “prizes” are not “things of value,” you are walking on very thin ice. When I was advising an international gaming company, I had a binder several inches thick that contained gambling statutes and expert legal analysis of what those statutes meant. It had to be updated constantly. And there were some jurisdictions where certain features were available and other jurisdictions where they were not. Keeping track of that is part of the process, and cost, of doing business for an international gaming company.

If you are not willing and/or able to adopt that process, or assume that cost, you have no business operating in this field. Especially since the more casual/entertainment gaming sphere’s use of some of these principles *cough*lootboxes*cough* is starting to show up on the radar of legislators and gaming commissions. I expect significant change in the regulatory environment in the near to medium term: the only way you, as a developer, have any chance of staying out of trouble is to get good legal counsel. Or, alternatively, don’t offer products that include these kind of features.

As always, questions are welcome in the comments or on my Twitter @legalinspire. Thanks for reading!

Gambling May Be a Game, But Not All Games Are Gambling

I was delighted to be invited to participate in an episode of Robot Congress, a podcast about video games, the law, and whatever else they feel like talking about. Here’s a link:

https://headgum.com/robot-congress/robot-congress-52-are-loot-boxes-gambling-ft-marc-whipple

Please check it out. And subscribe to the podcast, it’s good!

The DMCA Is Not A Weapon for Great Justice

(Note: I am an attorney, but I may or may not be licensed in the jurisdiction of any particular reader. Nothing in this post constitutes legal advice. Consult an attorney licensed in your jurisdiction and familiar with the relevant law before making legal decisions. In some jurisdictions, this post may be considered ATTORNEY ADVERTISING.)

This post was written for IndieGamerTeam – which you should check out!

All right, you’re really going to make me do this, aren’t you? I tried to tell you not to play stupid legal tricks with DMCA notices. But oh no, you wouldn’t listen.

*opens emergency cabinet marked IN CASE OF FAIR USE ARGUMENT, takes out and dons helmet which has a picture of an adorable mini-lop rabbit with a switchblade*

Let’s rock, nerd-person.

First of all, if you didn’t see my previous post about literally using DMCA notices as a Stupid Legal Trick, there’s a primer linked there on The DMCA Takedown Notice Demystified. You should read at least that primer, because it is informative, and preferably my post, because it is awesome. The summary? Don’t use DMCA notices as a Stupid Legal Trick.

Those of you who are plugged in to the Twitters probably know what inspired this post, but let me sum up a hypothetical:

Developer posts Notice on their website that anybody who wants to can stream or post videos of people playing their games.
NetPersonality posts a vid wherein they are playing a game from Developer.
NetPersonality does something Bad, which Developer does not like, totally unrelated to Developer’s game and the aforementioned vid.
Developer, without taking down Notice, DMCA’s NetPersonality’s vid, hosted on Host.

Who can tell me why this is a bad idea? Anyone? Anyone?

That’s right: it’s playing a Stupid Legal Trick with a DMCA notice.

And that is, ALWAYS, a horrible, terrible, no good, very bad idea.

Now, in this case, as opposed to the situation I discussed last time, we’ll assume that most people would probably agree that what NetPersonality did was Bad. We’ll even assume that I myself would say it was Bad. But DMCA notices are not. For. Punishing People! Using them in that fashion just gives ammunition to the forces opposing the rights of small and independent creators, who would like nothing better than for DMCA notices to Go Away.

“But wait,” I hear you say. (I keep telling you to pitch that Google Home, but do you listen? No. I do, though.) “You put on your FAIR USE helmet! Why did you do that if you were just going to yell at a hypothetical Developer for abusing DMCA notices?”

Well, first of all, it is a very cool helmet. Secondly, because what Developer did in my hypothetical is an interesting reason to think about Fair Use. Ultimately, NetPersonality has to believe in good faith that they have some legal grounds to use the game in their vid. Since they did literally copy Developer’s game, or at least portions of it, Fair Use is really the only grounds they have to counter-notice. So buckle up: here we go.

There are four Fair Use factors, plus the Zeroth Factor. The Zeroth Factor (“Is the alleged Fair Use bad?“) weighs against Developer, because the alleged Fair Use is unrelated to the Bad thing. But it also weighs in favor of Developer, because we’ll assume it was pretty Bad and therefore NetPersonality is assumed to be a Bad Person and we don’t like Bad People. I’m going to call it a wash and move on to the actual factors.

First Factor: The purpose and character of your use.

Essentially, this question boils down to “Is the use transformative?” If it is, this factor weighs in favor of the use being fair, because we want to encourage people to create new art. If not, it doesn’t, because we are not as concerned about people who just copy stuff. What transformative means is… complicated. But in this context, any use we might care about, be it a playthrough or a straight up game review, is probably not transformative. For purposes of my hypothetical, I have decreed it thus. So this one weighs against NetPersonality .

Second Factor: The nature of the copyrighted work.

This refers, basically, to two sub-questions.

First, is the infringed work mostly factual (for instance, a biography of Abraham Lincoln) or mostly original (for instance, a comic book about Abraham Lincoln secretly being a vampire hunter?) If it’s mostly factual, the use is more likely to be fair, because facts cannot be copyrighted, and there are only so many ways to describe a given set of facts.

Second, did the creator of the infringed work publish it before the infringement? If not, the use is less likely to be fair, because the decision as to whether to publish a work is a very important one and we want to protect creators against having that decision taken away from them by infringers.

Developer published the game (point: NetPersonality ) but it is a largely original work of fiction (point: Developer.) This factor probably weighs slightly in favor of Developer, but it’s really not a huge win for either side.

Third Factor: the amount and substantiality of the portion taken.

You will note that in my hypothetical I didn’t say whether the vid was a drive-by, a full review, or a complete playthrough. That makes a huge amount of difference and in many cases of this type will be largely determinative of the outcome, especially when the fourth factor is added in.

“Amount” just means “How much, percentagewise, of the work did you copy?” Please note that there is NO magic number, for any type of work. There is no “eight bar rule,” no “twelve second rule,” and no “ten percent rule.” The more you copy, the more likely that the use is not fair, and vice versa. After that it is determined case by case.

“Substantiality” means “How important was what you took to the work?” Think of this, if you like, as the “Courts Hate Spoilers” rule. If you just take some random screenshot and put it up to show the general graphics style and production quality of the game, no big. If you show the six-minute cut scene that reveals the resolution of the entire plot, even if the game has six hours of cut scenes and six hundred hours of main storyline play, you are probably not making a Fair Use, you spoiling so-and-so.

If the vid is a playthrough, this factor weighs in favor of Developer. If it’s a straight review, it probably weighs in favor of NetPersonality unless the review includes extremely substantive copied material. If it’s a drive-by, it almost certainly weighs in favor of NetPersonality .

Now, pay attention: law is complicated. Despite what I said before, spoilers in and of themselves are okay, but copying substantial portions of the work which might contain them isn’t, largely because of the fourth factor. Namely…

Fourth Factor: The effect of the use upon the potential market.

Now this is where this hypothetical really gets interesting. Usually, this is about whether the alleged Fair Use will reduce the likelihood that people will buy the original work (or otherwise make it harder for the original creator to exploit it.) Making cheap, identical prints of someone else’s original artwork makes it harder for them to sell their own prints – that’s an easy one. Probably not a fair use.

Showing the play of the game including the ending makes it less likely that people will buy it because the ending has been spoiled – that’s a little harder. Arguably, the sort of person who watches a Let’s Play in its entirety wasn’t going to play the game anyway – or might still buy it because the playthrough looked like fun and they want to experience it themselves. Still probably not a fair use, but arguable.

Here, though, Developer demonstrably does not care if people post playthroughs. They have authorized the posting of playthroughs. It’s going to be very difficult for them to argue that another playthrough, more or less, will have any significant effect on the market. (Fancy Legal Term of the Day: “Estoppel.” Look it up.)

They could raise a different objection. Specifically, that allowing NetPersonality to associate themselves with the game will, somehow, harm the market for the game. I think that this argument is novel, in terms of copyright law. Would it work? Hell if I know. I think it’s a desperation argument, but that doesn’t make it an automatic loser. Until we know, I think that in context, this factor weighs heavily in favor of NetPersonality .

Okay, let’s sum up our factorial analysis. (I have a degree in math and that was a brilliant pun. Fight me.)

Factor Zero: Wash.

Factor One: Developer by a mile.

Factor Two: Developer, barely.

Factor Three: Depends on nature of vid. Playthrough: Developer. Review: (Probably) NetPersonality .

Factor Four: Absent success of novel legal theory, NetPersonality in a walk.

Result: Who knows? Are you asking me if the host should honor the DMCA notice, or whether Developer would win a copyright infringement case? Or what kind of damages Developer would be entitled to if they did in fact win a copyright infringement case? (In the legal biz, if you win the case and get no damages, that may or may not be considered a win.) You didn’t even tell me if the vid was a playthrough or a review, for crying out loud. How am I supposed to know these things?

Okay, seriously. I will say the following:

In my opinion there was a much, much better way for Developer to proceed than by filing a cold DMCA notice, and it wouldn’t have been hard (or that expensive.) Note that this is in my hypothetical. I do not know what the developer in the situation which inspired my hypothetical did. For all I know they did exactly what I would have advised. Or something even cleverer, impossible as that seems. (NOTE: While nobody’s talking, for once, good for them, at this point it is not clear if the developer did anything at all or if the net personality took down the video of their own accord.) Will I tell you what it was? No. That would constitute legal advice. Any good copyright attorney would probably arrive at it very quickly, and almost nobody who wasn’t a good copyright attorney would come up with it at all. This is why you should hire an attorney before you attempt Stupid Legal Tricks.
If I were counsel for Host in my hypothetical, I would advise Host to honor the takedown notice. If NetPersonality filed a counter-notice I would advise the host that they should honor the counter-notice. NetPersonality isn’t required to justify the counter-notice, nor is Host required to evaluate it for legal sufficiency other than that it must meet all technical requirements for a counter-notice.
If Developer hired me to sue NetPersonality for copyright infringement in my hypothetical, I would advise them that the suit was not a slam-dunk, which is what I tell all my clients, and that recovery of significant damages would be particularly tricky as the facts of the case are very unusual.

In any event, I hope you understand a little more than you did before about this kind of thing. As always, questions or comments are welcome. If this sort of thing interests you, there are more post at my blog, Legal Inspiration!, and you are welcome to check me out on Twitter.

Thanks for reading!