Video games offer a melting pot of intellectual property: trademark law, copyright law, and even patent law all come together in a delicious mix of intangible property. However, not all video game franchises are equal. Few can claim the same level of longevity, success, and nostalgia as Nintendo’s Mario Brothers series.

Among the most popular titles of the franchise is Mario Kart, a game in which characters from the franchise race each other in go karts. The characters repeat catch phrases, seek out power ups (invincibility, speed, etc.) and cartoonish weapons (banana peels, turtle shells, etc.), all with the singular goal of being atop the podium at the end of race. Over its 25+ years of existence, the game has resulted in significant sales, widespread nostalgia, and, unsurprisingly, numerous attempts from others trying to make money off of the characters. But a recent lawsuit in Japan brought media exposure to what might have been the greatest attempt yet to profit off the franchise: real life go-karting in Mario Brothers costumes in the streets of Tokyo.

How fun is that? From what I can tell, riders aren’t allowed to throw things at each other (thanks a lot, safety laws), but this tour would still be great. The attraction even attracted professional race car drivers. You don’t even need to provide your own costume, they’ve got a ton for you to choose from.

Race car drivers weren’t the only people to discover the tour. Nintendo’s lawyers did, too. I’d like to imagine they participated at least once before suing them, if only under the pretense of “fact development.” Nintendo sued and ultimately prevailed on claims of copyright infringement. The company has to pay Nintendo 10 million yen (about US$89,000) and can no longer hand out Mario Brothers character costumes.

It’s hard to quibble with Nintendo’s actions here. The MariCar company intentionally distributed character costumes in order to attract customers.

But what are Mario Kart fans supposed to do now? Well, there will be an official Super Nintendo World opening at Universal Studios Japan ahead of the 2020 Tokyo Olympics. The theme park will include a Super Mario World featuring Bowser’s castle, Peach’s Castle, and, yes, a “Mario Kart attraction.”

But if you prefer the thrill of participating in likely infringing activities, you can check out the Australia-based MUSHROOM RALLY race event purportedly coming to Denver, soon. Participants will have a chance to battle it out in Las Vegas for the championship race. Ticket prices are yet to be determined and are limited to just 600 participants. I suggest you read the fine print on the refund policy though – just a hunch…

— Jessica Gutierrez Alm, Attorney

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I’m a rules follower. Going back to the days of the Game Genie—a device that allowed gamers to play Super Mario Bros. with infinite lives or the Legend of Zelda with infinite bombs—I have always preferred the satisfaction of beating the IMG_0016game by its own rules.

Like the video games that have progressed since the Nintendo NES, the corresponding cheat codes have become increasingly more sophisticated. Bossland is a company that creates and sells entire programs dedicated to hacking and cheating in popular video games, such as World of Warcraft, Overwatch, and Diablo 3, all made by Blizzard Entertainment. Many of the Bossland programs allow users to create “bots” that play the game automatically without any user interaction so that the user can, for example, achieve a higher level character without the usual effort. This is a practice sometimes referred to as “botting.”

Blizzard has been fighting companies like Bossland for years. Since 2013, Bossland has sold approximately 118,939 products in the United States alone. Blizzard estimates that 36% of these products were cheats for Blizzard games. In June of 2016, Blizzard sued Bossland in the Central District of California. According to Blizzard, the Bossland cheats give users an unfair advantage, reducing the enjoyment of the game for other players. Blizzard alleged, among other causes of action, that Bossland violated an anti-circumvention provision of the Digital Millennium Copyright Act. The DMCA provides:

No person shall manufacture, import, offer to the public, provide, or otherwise traffic in any technology, product, service, device, component, or part thereof, that—
(A) is primarily designed or produced for the purpose of circumventing a technological measure that effectively controls access to a work protected under this title;
(B) has only limited commercially significant purpose or use other than to circumvent a technological measure that effectively controls access to a work protected under this title; or
(C) is marketed by that person or another acting in concert with that person with that person’s knowledge for use in circumventing a technological measure that effectively controls access to a work protected under this title.

17 U.S.C. 1201(a)(2). Within its games, Blizzard has “technological measures” that operate to prevent users from using cheats and hacks, but the Bossland programs are designed to work around Blizzard’s measures. At first blush, Bossland’s programming seems like the very type of circumvention efforts that the anti-circumvention provisions of the DMCA were designed to protect against. But the DMCA was enacted in response to internet file sharing concerns. In 2009, Blizzard was involved in a similar lawsuit against another cheat company. Many were concerned that a ruling in favor of Blizzard would overly expand the DMCA to allow for recovery under any circumvention of any type of technological control. Jef Pearlman of Stanford University suggested that “because anything can contain copyrighted works,” a ruling in favor of Blizzard could suggest that “any access to anything becomes a DMCA violation.” Blizzard did win its 2009 case, and the judgment was affirmed on appeal to the Ninth Circuit.

Late last year, Bossland motioned to dismiss the lawsuit for a lack of jurisdiction over the Germany-based company. The district court denied Bossland’s motion. After that attempt, Bossland apparently stopped defending the suit altogether. As a result, Blizzard obtained from the court a default judgment against Bossland. The judgment awards damages to Blizzard based on available statutory damages under the DMCA. The DMCA allows a plaintiff to collect a minimum of $200 per violation. Blizzard alleged 42,818 violations of the DMCA, and because Bossland did not dispute any of them, Blizzard obtained a judgment of statutory damages to the tune of over $8.5 million.

Bossland maintains on its product websites that “Botting is not against any law.” While perhaps technically true, the circumvention of digital copyright safeguards is.

Last week was rough.  We went from celebrating America to watching her at her worst.  We saw officers shoot two black men in Baton Rouge, LA and Falcon Heights, MN, a black man shoot cops in Dallas, and resulting social unrest (including my hometown police being hit with concrete last weekend and protests blocking our freeways yesterday).  We read polarizing social media posts.  Everyone seems more on edge than I can ever recall.

Call me a conspiracy theorist if you must, but what a perfect time to release a mind-numbing game called Pokemon Go!

I have not played the game myself – and don’t intend to given the fact that it’s probably “a government surveillance psyop conspiracy” according to a worthwhile read from Mashable) – but my friends say the game is “EVERYTHING.”   To the extent that I understand it, apparently you try to catch cute characters like Pidgey and Pikachu on your smartphone’s screen and, once you get to a certain level, you then can go to “gyms” (real locations) to find things to catch.  It seems somewhat like geocaching with your phone and with unreal objects.  From one friend:  “A kid found a dead body while playing – she indicated that she wasn’t too scared to stop playing, so that’s a positive sign.  I have never taken my dogs on more walks, so I think they like the game too.  The other day I biked by a pack of teens pawing at the door of a locked church trying to get in to take over the ‘gym’ located inside – it’s weird seeing teens desperately trying to get into churches.”  I don’t get it.

Conversations with friends have devolved into “Martha, I’m fine waiting, I just saved [partner] from a Seel and he didn’t even thank me,” and I’ve grown increasingly uncertain about whether “I am going to try to go to the gym later” means a place to work out or a place to play Pokemon Go.   Based on what I’ve seen it do to people’s walking ability, I am scared to be on the roads with anyone trying to “catch” things that don’t exist in reality while trying to drive in reality.

Perhaps dazed itself, the pending U.S. trademark applications for the POKEMON GO logo (here, here, and here) have been refused registration as being likely to be confused with a registration for POKEMON in standard characters.

Mark Image

These three applications were all filed based upon foreign applications, which were filed by Nintendo Co. Ltd. (a Japanese corporation) as the applicant, and thus the Japanese corporation was listed as the applicant on these U.S. filings.  However, Nintendo of America Inc., an American corporation incorporated in Washington, owns the registration for POKEMON.

Nintendo, and companies finding themselves in similar situations, can overcome this issue by claiming ownership of the prior registrations.  In order to do so, Nintendo would need to (1) record an assignment of the prior POKEMON registration from the American corporation to the Japanese corporation, (2) submit copies of documents evidencing the chain of title, or (3) submit an affidavit or declaration stating that the applicant is the owner of the cited registration.   Additionally, when making maintenance filings, it is important that the company that owns the mark have control of the use of the mark, even when that use is made only by the company’s parent company.  As the TTAB ruled earlier this year in  Noble House Home Furnishings, LLC v. Floorco Enterprises, LLC, a parent company’s use of a wholly-owned subsidiary’s registered mark does not inure to the benefit of the subsidiary if the parent controls the nature and quality of the goods sold under the mark.  In the alternative to claiming ownership of the marks, Nintendo of America Inc. could file new US-based applications for the mark, and these applications could be abandoned, but Nintendo would lose the priority date of the original filing.   Multinational corporations and corporations with subsidiaries should consider these ownership issues when managing a trademark portfolio that includes filings in the United States.

 

— Jessica Gutierrez Alm, Attorney

Nintendo has been making headlines recently.  The gaming industry is in mourning over the unfortunate passing of Nintendo CEO Satoru Iwata last week.  Iwata was instrumental in the success of the Nintendo Wii, among other Nintendo creations, and was known for his accessibility to fans.

Nintendo was in the news again this week for a patent litigation victory.  The gaming company was sued by Quintal Research Group for alleged patent infringement.  Quintal argued several Nintendo products, including the Nintendo DS and Game Boy Advance, infringe Quintal’s patent.

Quintal’s patent, which expired in 2011, relates to handheld computing devices, and particularly to “a portable handheld communication device for rapid retrieval of computerized information.”  The Quintal patent describes a handheld device with a display screen and ergonomically placed finger controls, including thumb controls “symmetrically arranged” on either side of the display screen.

Some drawings from the Quintal patent depicting the handheld device:

The “symmetrically arranged” thumb controls are the two side buttons, each labeled 166 on Fig. 19A.

 

Certainly, Nintendo’s handheld devices also have a display screen and ergonomically placed finger controls.

This chart was referenced in the judge's Order. Game Boy Advance and Game Boy Dual Screen (a.k.a. Nintendo DS)
This chart was referenced in the judge’s Order to show examples of the accused devices: Game Boy Advance and Game Boy Dual Screen (a.k.a. Nintendo DS)

 

The district court judge granted Nintendo’s motion for summary judgment, finding the Nintendo devices do not infringe the Quintal patent.  According to the judge’s ruling, the case turned on the definition of “symmetrically arranged,” as that term is used in the Quintal patent claims.

In order to argue that Nintendo infringed the Quintal patent, Quintal had to show that Nintendo’s devices meet every element of the Quintal patent claims.  The claims require thumb controls “symmetrically arranged” on each side of the display screen.  Quintal argued that “symmetrically arranged” refers merely to placement or location of the controls on the device—that they are equidistant from the screen.  Nintendo, however, argued that “symmetrically arranged” thumb controls means thumb controls that are mirror images of one another, having the same size and shape.  The judge agreed with Nintendo’s definition.

As shown in the images above, the thumb controls (numbers 166) of the Quintal device are indeed depicted as symmetrically sized and shaped.  In stark contrast, thumb controls on either side of the screen of the Nintendo devices are not at all mirror images (the cross-shaped button is different in size and shape from the opposing A and B buttons on the Game Boy Advance, for example).  Therefore, Quintal could not show that Nintendo’s devices meet every element of the Quintal patent claims.

The case serves as an important reminder of the sometimes contrasting processes of (1) obtaining a patent and (2) enforcing a patent.  Narrow claim limitations added to overcome patent office rejections may render the claims so narrow that competitors can easily overcome them in later litigation.  During the process of obtaining its patent, Quintal added the “symmetrically arranged” language to its claims for the purpose of overcoming a prior art rejection in the patent office.  Quintal’s device was patentable because the buttons were “symmetrically arranged.”  Ultimately, it was that same language that defeated Quintal’s infringement contentions.

– Derek Mathers, Business Development Manager, Worrell

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We are at the brink of a very interesting paradigm shift in economic and legal history, where the fabrication of physical objects is becoming as democratized and accessible as computer processing. Decreases in the price of digital fabrication (3D printing) along with improvements in the mechanical capabilities and materials for the application have shown exponential adoption for personal and commercial purposes.

How do manufacturers feel about this? Nintendo is scared. The Tokyo-based company is currently opposed to the 3D printing of their characters, fearing that it would disrupt their physical sales, displacing their retail partners. However, some suggest that 3D printing may offer new possibilities for Nintendo to profit from the printing of their characters, at fraction of the cost of their current channels.

In this new model, it’s conceivable for Nintendo to recognize a staggering increase in profit from selling files of its characters, rather than physical products, completely negating the need for tooling, production, logistics, etc. In this arrangement a Super Mario action figure could be purchased via a secure product-streaming platform, hosted by Nintendo. From the customers’ perspective, he/she receives near-instant access to a customizable, manufactured-like product without a trip to a local retailer or Amazon.

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This sounds like a wonderful future, but it’s not without its risks. As a parallel, it may be helpful to look at the growth 3D printing less like that of standard 2D printing, and more like the music industry of the last 20 years. If you recall, artists and studios lost billions as barriers to “music fabrication” were reduced from capital-intensive investments and expensive studio equipment to a laptop computer. On top of that we saw a cataclysmic wave of piracy that nearly engulfed the industry.

Then the business model changed. Digital music services such as Spotify and Soundcloud now provide on-demand access at a reasonable price point, while simultaneously eliminating piracy.

Exposed to same pressures, the key for the world of physical products is likely to be a similar ecosystem, where digital services provide verified, high-quality 3D files for home and commercial printing.

It isn’t often that Forbes and Arcade Sushi are reporting on the same story. But some news is so big, so ground breaking, and so important that all media outlets cannot, in good moral consciousness, fail to comply with their duty to inform the public. Obviously, I’m talking about Microsoft’s potential reboot of the Battletoads franchise.

For those of you who wasted away the early 1990s not playing video games, (shame!) the Battletoads video game franchise centered around three mutant toads (Rash, Zitz, and Pimple), trained in marital arts, who fought against evil doers. And I can assure you that any and all similarities between these characters and the Teenage Mutant Ninja Turtles are purely a coincidence. The video game’s developer, Rare, has said so and they certainly would have no incentive to lie.

The game was first released in 1991 on the original Nintendo (of the Entertainment System, or NES, variety).  And it was a big hit. Gamers loved it, even though it is considered one of the most difficult video games to beat, even still today. Yet despite the popularity, the last home console video game was released in 1993, while the last Battletoads video game ever was released in 1994 as an arcade machine. And then, nothing.

But the fans continued to praise the game. From 2010 onward, gamers and media organizations continued to place Battletoads as one of the top games that should be remade on a new system. Among the advocates were Game Informer, Maxim, GameRevolution, SiliconEra, and yes, even Forbes. Sounds like a great idea. But who owns the rights to the game?

Turns out, Microsoft – maybe. Rare, the game’s original developer, is a British game developer that has been around since 1985. However the company was purchased by Microsoft in 2002 for $375 million. And now, after 12 years of waiting, Microsoft may be bringing the Battletoads back. Where is all the speculation coming from? Well, it turns out that just last week, Microsoft filed an application to register the mark BATTLETOADS in connection with video game software. And let the rumor mills begin (and continue, and continue).

The response from Microsoft when reached for comment?

Microsoft often acquires various trademarks as part of its ongoing business strategy, but beyond that we have no comment.

So, case closed. Microsoft owns Battletoads. Probably. They presumably purchased all of Rare’s copyrights and trademarks, even if Rare/Microsoft hasn’t produced a Battletoads video game in exactly 20 years. Which of course raises the question of whether the trademark had been abandoned. Could a rival game-maker have produced their own video game last year and called it Battletoads?

Under the Lanham Act, abandonment occurs when “its use has been discontinued with intent not to resume such use.” 15 U.S.C. § 1127. However, three years of non-use creates a presumption of abandonment. Well, by my lawyer math: 20 > 3. But of course, there are always exceptions. For example, continued sales of older products can constitute use of the trademark, attempts to license or sell products or the rights to the trademark can also weigh in favor of a finding of non-abandonment.

Some courts treat the issue as whether there is “continuing recognition” of the mark by the public. This is more common with out-of-production automobiles, in part due to their expensive nature, continued production of parts, and continued provision of repair services.  Those factors aren’t quite so strong with video games. However, based on the continued public outcry for more Battletoads, it is hard to deny their isn’t any continuing consumer recognition or residual goodwill in the Battletoads mark.  So maybe, just maybe, it was a good idea I didn’t quit my job last year to release my own Battletoads video game. It would have been fun, but I avoided a potential trademark battle (along with likely claims of copyright infringement, too, for the Battletoads characters…).

Over the last few years, American business appears to be in love with recycling. We’ve seen remakes for nearly every super hero movie (even remakes of remakes with Spiderman and the Hulk). Dodge has resurrected the Challenger. And now Microsoft has brought the Battletoads back to life. Will this be the start of a new rush to buy up rights to old video game titles?

I’m not sure. But my guess is that it will be difficult to buy copies of Battletoads on eBay for a while. Almost as difficult as beating the game.