1. IP Law in Games and Virtual Worlds
©Ed Lamoureux, 2013, 2014, 2015, 2017, 2018

2. Game or VW? Both are: “complex works of authorship – containing multiple art forms, such as music, scripts, plots, video, paintings and characters – that involve human interaction while executing the game with a computer program on specific hardware.” Ramos, et al., p. 7
“a computer generated display that allows or compels the user (or users) to have a sense of being present in an environment other than the one they are actually in, and to interact with that environment,” Schroeder, p. 2

3. VW or Game?
Game: focus the interaction such that participants follow a narrative and quest (seeking rewards along the way)
VW: focus on social interaction as the salient activity

4. The 8 ISSUES The Magic Circle
The nature of content ownership in virtual worlds
Ownership and Control of Rights
Which IP rights?
“Place” and Jurisdiction
Control and Process: TOS/EULA
Rampant infringement or Transformative Fair Use?
ISP or Content provider: Safe Harbor?

5. The Magic Circle What happens in X, stays in X
Not a “legal” principle with standing, but,
a widely held “philosophical” approach that seems to have some merit
If the content and outcomes all stay inworld, courts may be less interested in the litigation.
The more that comes out, the more it seems that RL laws might apply.
Even within the circle, though, claims can still be made.

6. The nature of ownership
Most providers specify (TOS/EULA) that they own everything
Where/when players/residents “own,” things, one has to get very deep into the TOS to find out what that means. Generally, it’s a license for use within TOS specified parameters.
However, encouraging the sense of ownership raises the stakes for disputes and litigation.
Players buy, sell, and trade AS THOUGH they own (both in and out of world) regardless of TOS.
Does this get even more complex as avatars “become the player”?

7. The nature of ownership
Remember that the sense of (and behaviors surrounding) ownership reflects back on the magic circle.
Differences between “inworld/ingame” ownership rights and ownership rights outside of the world/game?
Ownership of rights over derivatives is contested, for example, “mods” and machinima
Special case for machinima: whose copyright(s) is/are violated? Only the game/world developer? What about the player(s) who “create” the avatars and actions that the machinima captures/re-represents?

8. Assignment of rights
Normally, the vast array of developers give up their rights during the production process
Although… as with copyright termination, one might expect to someday see workers attempt to recover lost rights for their work in group projects.
Much bigger issue in games and VWs: their multimedia nature.
Lots of elements come from outside the development process.
Some of these elements might be injected by players.
Games and VWs are VERY contractual-relevant environments SOMETIMES created by folks who aren’t that good at contracts.

9. Which IP rights?
From the perspective of the PRODUCER/DESIGNER/GAME or VW company, protecting all aspects of the IP rights inherent in the game/world is crucial.
Again, from the perspective of the PRODUCER/DESIGNER/GAME or VW company, not infringing others’ rights, to the point of facing litigation, is crucial.

10. Which IP rights?
However, from the USER perspective, there is often (1) a sense of ownership, (2) a sense of creativity, (3) a sense of participation that leads one to believe that there are or should be rights inherent in participating/playing.

11. Which IP rights? (and primary issues)
Pretty much like our course, from a contextual perspective:
Copyrights
As literary?
As Art?
As compilation?
to who?
Is EULA over-ride valid?
Derivatives?

12. Which IP rights? (and primary issues)
Patents
Is the EULA over-ride valid?
Hardware, software, methods/process, package design
Trademarks
in-game use doesn’t confuse real world product
might confuse users over sponsorship of virtual products
might dilute real world marks)
Contracts are crucial
Games and VWs may work harder to protect THEIR trademarks than those of other companies.

13. Which IP rights? (and primary issues)
Torts of the persona
Right of publicity issues abound
No such thing as privacy of the persona Should there be? Can there be?
Defamation is really sticky: LOADS of bad stuff happens and is said … is any of it actionable?
Eh.. Remember… it is actionable, online.

14. Which IP rights? (and primary issues)
trade secrets
insider “cheats” or disclosures of mechanics?
Tough call; loads of them out there but might this not, someday, be treated as “insider trading”?
Source vs. object code
Non-competes and confidentiality agreements and standard trade secret law apply
International: Jurisdiction; differing interpretations of magic circle issues/status; differences in IP laws.
ALL of everything

15. EULAs/TOS & Jurisdiction
Unconscionability? Excessive over-ride, by contract law, of IP and other laws?
(unjust, overwhelmingly one-sided terms favoring one party)
When and how does real world law apply within virtual environments?
Esp. when they are global.

16. “Place” and Jurisdiction
As with other online issues, whose law?
International “zipper” v. “effects” tests?
Complicated by
The sense of “place” in virtual spaces: where are they?
To what extent does it matter if host is centralized or distributed?
Esp. once there is inter-portability AND self-hosting.
Multinational globalism
Contract law: license v. ownership v. users’ sense of rights and belonging varies by jurisdiction/country/culture

17. “Place” and Jurisdiction
Some VWs have internal jurisprudence procedures
Legal status of these procedures?
Some are trying to enact new world orders
As open source/non-proprietary worlds increase, this should too

18. Control and Process: TOS & ULAs
Bragg v. LL started to lay these bare (and aside)
LL advertised “you own it”
Bragg figured a cheat on the land sale profit system
LL took his stuff/suspended his account
Court hammered them for bad TOS and bad appeals system;
LL gave the user back his stuff, then changed their TOS to say that users no longer own anything (except their IP rights, except when LL wants to use the material in their promotions).
Courts HAVE upheld users’ copyrights in infringement cases between users

19. Some argue that users have rights REGARDLESS of TOS/UELAs
Tyler T. Ochoa
“Who Owns an Avatar? Copyright, Creativity, and Virtual Worlds” [.pdf]
VANDERBILT J. OF ENT. AND TECH. LAW [Vol. 14:4: ].
By the nature of the creativity through which users evolve their avatars, there is shared/joint copyright (that can’t be overridden by TOS/ULA)
Ochoa’s theory Not law or case hardened/tested.

20. Rampant infringement or Transformative Fair Use?
If it appears in a virtual world/online game, it can’t really be protected
Remember the lessons of DRM
Does appearing in a virtual world thereby qualify as transformative fair use? This has not “worked” (often) as a defense in games cases.
Users often treat VWs as NOT RL and as though RL rules don’t apply. Infringement is rampant.

21. Rampant infringement or Transformative Fair Use?
RL rights holders haven’t been hugely interested in trying to protect their stuff. Not enough $ in doing so (yet). In some ways, VWs are too esoteric to draw full attention.
User cases show how and why users ARE interested.
Gibson Island on SL shows (maybe) how and why RL rights holders SHOULD be interested, esp. over trademarks (as their strength depends on use in geographic area and/or niche and someday a court might start treating a VW as a “place” or as a market segment).

22. ISP or Content provider: Safe Harbor?
One would think that providers put in WAY TOO MUCH content to claim ISP pass- through. Yet…
They all claim it and receive it.
Online games, especially virtual worlds, will test the limits of the DMCA / 230’s safe harbors

23. Roughly,
All laws are in place and best as we can tell, apply. There are cases that indicate as much.
Jurisdictional issues are as complex as IP law, globalism, and the internet can make them.
IP law is the tip of the iceberg. Ownership of every aspect and behaviors of every kind, not just IP law issues, are at play and risk. . If IP law is behind (new media), IP law in virtual environments is even “behinder.”
What one "owns," "uses," and "does" in virtual spaces are all at issue, ESPECIALLY virtual currencies.
Lawyers now specialize in IP law for games and VWs.
There are content holders with interests. There have been and will be cases.
Think how poorly the system deals with the internet and international. Then multiply to infinity and beyond.

24. Some Background
Anne Wells Branscomb (ed.) Journal of Computer-Mediated Communication: “Emerging Law on the Electronic Frontier” Volume 2, Number 1: Part 1 of a Special Issue June, Especially:
Part One:
David R. Johnson, Due Process and Cyberjurisdiction.
Tamir Maltz, Customary Law & Power in Internet Communities.
Juliet M. Oberding, A Separate Jurisdiction For Cyberspace?
Part Two:
Niva Elkin-Koren, Public/Private and Copyright Reform in Cyberspace.
Post, David G., and David R. Johnson, (2006). "The Great Debate--Law in Virtual World." First Monday. 11 (2)
Duranske, Benjamin. Virtual Law: Navigating the Legal Landscape of Virtual Worlds, ABA, 2008
Ross A. Dannenberg . Computer games and virtual worlds : a new frontier in intellectual property law ABA, 2010.