Law of the Game

LGJ: Revenge of the Regulators

2009-10-24T15:38:00.002-05:00

This week's LGJ dissects 'ecogenerism' as it applies to regulating video games based on a new paper from Michigan State University School of Law.

Read on!

LGJ: 3D Dot Game Infringement

2009-10-23T15:41:00.000-05:00

In this LGJ, I talk about the allegations of 'copyright infringement' in 3D Dot Game Heroes.

Read on!

Game::Business::Law 2010 is Official

2009-10-05T17:56:00.004-05:00

I wanted to take a moment to post the following press release. Last year's event was outstanding, and I think the upcoming conference will be even better. I will be a speaker again this year, and hope to see some readers in the audience. Registration is limited, so be sure to secure a spot soon.

News Release

Registration for 2010 Game::Business:: Law Summit Now Open via game-business-law.com
2nd Annual International Summit on the Law and Business of Video Games to be Held January 27-28, 2010 at SMU

SMU/Dallas-October 5, 2009- Registration is now open for the 2010 Game::Business::Law Summit, the second annual international summit on the law and business of video games, to be held January 27-28, 2010, at Southern Methodist University.

Hosted by SMU Dedman School of Law, The Guildhall at SMU, and The Center for American and International Law, the summit will once again bring top game industry leaders, developers, publishers, lawyers and members of the venture capital and financial industry from around the world to discuss current business trends and legal issues in the games industry.

“If you are a business development person, a member of the legal affairs team or financial staff of a video game studio or publisher, you really should attend this conference,” Zack Karlsson, senior director of business development at NAMCO BANDAI Games America, said. “What makes this conference so great is the strong interaction of the audience with the panel members. It is really more like a discussion of key issues affecting the growth of our industry rather than a series of presentations and lectures.”

In order to foster the interactive nature of the conference between the audience and speakers, space will be limited. Attendees are encouraged to sign up early.

In response to the success and feedback from the 2009 Game::Business::Law Summit, organizers have announced an initial slate of notable speakers:

John B. Attanasio, Dean, SMU Dedman School of Law
Keith Boesky, Principal, Boesky & Company
Robin Bynoe, Senior Counsel, Charles Russell LLP (London, UK)
Roxanne E. Christ, Partner, Latham & Watkins
Ken Doroshow, Senior Vice President and General Counsel, ESA
Zack Karlsson, Senior Director of Business Development, NAMCO BANDAI Games America, Inc.
Joseph Olin, President, Academy for Interactive Arts and Sciences
David McCombs, Partner, Haynes and Boone, LLP
Shane McGee, Partner, Sonnenschein Nath & Rosenthal, LLP
Mark Methenitis, Electronic Entertainment Section, The Vernon Law Group, PLLC
Xuan-Thao Nguyen, Professor, SMU Dedman School of Law
Dr. Peter E. Raad, Executive Director and Founder, The Guildhall at SMU
J. Paul Raines, Chief Operating Officer, GameStop Corporation

For more information on registration, tuition and making a reservation to attend the event dinner, visit www.game-business-law.com

For additional information on the conference and possible sponsorship opportunities, contact Ron Jenkins, Deputy Director, The Guildhall at SMU, at jenkinsr AT smu dot edu or (972) 473-3546.

About The Guildhall at SMU:
The Guildhall at Southern Methodist University is the premier graduate video game education program in the US. Many of the school’s founders are industry icons, and classes are taught by industry veterans. In six short years, over 300 Guildhall graduates have worked at more than 80 video game studios around North America. SMU offers both a Master’s degree and a graduate Professional Certificate of Interactive Technology in Digital Game Development, with specializations in art creation, level design, and software development. For more information, visit www.guildhall.smu.edu.

About Dedman School of Law at SMU:
The Dedman School of Law at Southern Methodist University enjoys a strong national and international reputation, having produced successful leaders who live in the Dallas/Fort Worth area, throughout Texas, across the United States, and in more than 70 countries. Dedman Law is among the top 25 most selective of law schools for admission in the United States. With a small entering class size in the day and evening programs, an outstanding teaching faculty with superb credentials, and numerous distinguished guest lecturers, we forge an invaluable link between legal theory and the reality of legal practice––providing one of the best legal educations in the country. For more information, please visit www.law.smu.edu.

About The Center for American and International Law:
The Center is a nonprofit institution founded in 1947 and dedicated to the continuing education of lawyers and law enforcement officials in the United States and throughout the world. Tens of thousands of lawyers and law enforcement officers from all 50 states and more than 125 countries have participated in its programs. The Center for American and International Law is located at 5201 Democracy Drive at Legacy Park in Plano, Texas. For more information about The Center, please visit online at www.cailaw.org.

LGJ: Products LiabilODST

2009-09-30T10:57:00.001-05:00

This week's LGJ looks at warranties and products liability in a gaming context.

Read on!

LGJ: Come As Your Avatar, Smells Like Lawsuit? Nevermind

2009-09-15T18:07:00.001-05:00

In the latest LGJ, a discussion of the right of publicity as it relates to the Kurt Cobain in Guitar Hero 5 dust up.

Read on!

LGJ: You down with FCC?

2009-09-15T18:06:00.001-05:00

In this LGJ, a discussion of the role of the FCC and a little talk about the idea of universal ratings.

Read on!

LGJ: Welcome to the Big Leagues of Deception

2009-08-21T14:44:00.001-05:00

This week's LGJ is all about the fun trickery we lawyers use to keep deals and filings secret. It's probably only 'fun' in the most generous sense of the term to most people.

Read on!

LGJ: First Sale and Digital Distribution

2009-08-14T10:22:00.001-05:00

This week's LGJ takes a look at the interplay of first sale and digital distribution while also examining the ownership versus licensing argument.

Read on!

Online Video Game Gambling Still Questionable

2009-08-12T16:54:00.005-05:00

In the past few weeks, a lot of sites have had coverage of BringIt.com, a new site purporting to allow you to wager on games like Halo 3 and Madden NFL 10. I've talked about some systems like this before, and one fact still seems to be lost in the shuffle: the legality of these sites is questionable at best and consumers should proceed with caution. I've reviewed the BringIt.com terms and FAQs (though I have not registered for nor tried the functionality of the site), and to illustrate my point, I'm going to use my home state of Texas as an example. BringIt.com says it is perfectly legal in my state, but a simple review of the Texas gambling statutes indicates otherwise, though the risk is much higher for the website than for the gambler. Let me again preface this by saying that this is simply my opinion on the matter, and it is possible that the purveyors of BringIt.com have received an attorney general opinion which they base their business upon in some or all states. More importantly, none of this post should be considered to defame or disparage the owners or attorneys for BringIt.com, it's simply a disinterested arms length commentary on the system in question, of which BringIt.com is a prime example.

For those unfamiliar, a good summary of Texas gambling laws exists here. On the face of it, anyone participating in the site is a gambler, and the site itself is a bookmaker. There are a number of ways this violates the letter and spirit of the Texas laws. First and foremost, by collecting bets, the site is almost certainly a bookmaker by statute. And this activity is almost certainly the offense of gambling, defined as being committed when someone 'makes a bet on the partial or final result of a game or contest or on the performance of a participant in a game or contest.' And more importantly, it satisfies the test for gambling in Texas, since the answer woudl certainly be yes when asking 'does it encourage the gambling instinct?' (see Callison v. State, 172 S.W.2d 772, 774.)

More importantly, Texas has an explicit prohibition to internet gambling, which is defined as multiple people using multiple computers to play a game and bet on the outcome. In my view, this spells out exactly what we have here, and that sentiment is clearly echoed in a 1995 Texas Attorney General Opinion. This system is no different than the third question presented, using a bulletin board to facilitate online card games.

While this may look one sided, there are often exemptions in the law. So, is there an exemption, though, that the site can rely on? The 'social game' exemption is certainly inapplicable because BringIt.com is making money on the transaction. The exclusion of awards for certain contests of skill from the definition of 'bet' basically only includes certain kinds of prizes for contests, not one on one 'challenges' that are wagers by another name.

This, of course, ignores the fact that many EULAs and TOS (both for the games and for services like Xbox Live) may explicitly bar this kind of behavior. To that end, not only could the consumer be penalized, but BringIt.com could be presented with a suit not unlike the Glider case, and we all know how that turned out.

That's not to say the whole site has no legal factors in Texas. I have some questions to the legality of the online element, but land-based cash game tournaments have been legally run in Texas, with MLG events and QuakeCon being two of the most well known. Assuming the rules are being followed appropriately, at least the multiplayer bracket portion might be legal in Texas.

Of course, this opens the larger question: If there's on state with these kind of questionable issues, what about the other 38 the site allows play in? And what about the Unlawful Internet Gambling Enforcement Act, which bars most of this activity nationwide regardless? And is the site complying with the IRS rules regarding reporting of winnings? I don't want to nay-say the concept, but it certainly leaves me with questions based on my own analysis. Granted, I would greatly prefer a unified Federal stance on online gambling both legalizing and regulating the industry, and I would certainly support sites like this were the legal landscape clearer in that regard. For now, however, I would certainly proceed with caution.

LGJ: Fan Sequel? Still not legal.

2009-07-22T10:36:00.005-05:00

This week's LGJ talks about fan sequels, fan art, fan fiction...basically a ton of different kinds of derivative works.

Read on!

LGJ: And still, they want to take away our games

2009-07-16T18:27:00.001-05:00

This week's LGJ address some possible alternate routes the government might use to regulate video games, rather than the typical violence argument.

Read on!

The Debate Video - Now Available

2009-07-16T13:33:00.002-05:00

I'm sure many of you have been waiting for the video of my debate with Jack Thompson from SGC. Well, there's now both an unedited version and a 16 minute edited version available from ScrewAttack.

With that now up, some of my commentary from Late Nite JengaJam may make more sense in context.

It's been interesting to keep track of the comments and see what people take away from the video. It surprises me just how many people are taking unexpected points away from the debate, from stances I didn't think were represented, to contradictions that weren't stated, to issues with the formal debate style and issues with the format of responses (primarily responding to the question versus responding to the other party). I'm particularly confused as to why many people were critical of the fact that I didn't address the Saw game when it's basically impossible to comment on content of a game that isn't released yet. Certainly, it's interesting that the game is being released, but it's impossible to say whether the content there will be as graphic as the movies when the game isn't released yet.

In any event, enjoy the video.

The Thompson - Methenitis Debate Video is Forthcoming

2009-07-09T18:22:00.003-05:00

I know many folks on the internet are waiting for the video of the debate I had with Jack Thompson last weekend on the 4th of July at the ScrewAttack Gaming Convention in Dallas. I've been told by some of the folks at ScrewAttack that both an edited and an unedited version of the video will be up on their site next week.

In the mean time, I did find this seven minute clip from the latter half of the debate. I also did some post-debate commentary on this week's Late Nite JengaJam. Hopefully those two will tide everyone over until the full video is available online.

For those who didn't make it out to SGC, the event was outstanding, and the entire ScrewAttack crew deserves any and all praises you may have seen on their forums about the event. I also really appreciate Jack for making the trip out to the convention and participating in the debate.

As soon as the debate footage is available, I will make sure to post the appropriate links here on Law of the Game.

More on China's Virtual Currency Regulations

2009-07-02T10:45:00.003-05:00

CNN.com put up an article (which quotes me) on the Chinese virtual currency rules mentioned earlier this week on Law of the Game. GamePolitics has also posted two pieces on the rule, with different takes on the issue. It will certainly be interesting to see how this all plays out in practice.

LGJ: The new meaning of 'player vs player'

2009-07-02T10:43:00.002-05:00

This week, we talk about lawsuits between players. A new Craigslist-based verdict puts a serious damper on many possible avenues.

Read on!

China Bans Use of Virtual Currency for Real Goods

2009-06-29T13:28:00.003-05:00

News reports have come out that China has both defined 'virtual currency' and barred the use of that currency for purchase of real world goods. In theory, this is to combat certain underground uses of vitrual money by limiting their use to the purchase of virtual items. In practice, however, it could prevent the spread of virtual worlds like Second Life into China. Based on the Chinese definition of 'virtual currency,' the Linden Dollar used in Second Life is undoubtedly covered, and thus the interplay between the Linden Dollar and real currency would likely be problematic, though the use of Linden Dollars to purchase in-world goods may not be. It will be interesting to see how this continues to play out, especially in view of last year's finding that a virtual seizure had a real world value in China.

Reminder: The Big Debate is This Weekend!

2009-06-29T11:35:00.003-05:00

I just wanted to take a moment to remind everyone that the big debate between Jack Thompson and me is this coming Saturday, July 4, 2009, at 4 pm in Dallas, TX, at the ScrewAttack Gaming Convention. The convention is at the Westin Dallas/Ft. Worth Airport, starting this Friday and ending on Sunday.

They've updated the event page to note that it will be on the main stage in Trinity VI. Be sure to get there early, space is limited. I'm looking forward to seeing all the g1s at the event. I'm still waiting to hear from Craig, but I imagine I will be around the convention on Friday and Saturday before the debate.

Class Action Against SquareEnix Targets More Than Fees

2009-06-26T09:45:00.003-05:00

It's been on the major news sites that a class action has been levied against SquareEnix for fees associated with Final Fantasy XI, the company's MMORPG. However, there's more to it if you look at the filing posted by GamePolitics.

News sources have been quick to point out that the monthly fee is clearly stated on the Square website, as most MMORPGs with a monthly subscription plan do. Looking at the pleading, though, the main monthly fee isn't the crux of the complaint. I think the stronger complaint lays with the penalties and interest for late payments, and 'charges while the online game account is suspended,' if that means the monthly fee is continuing to toll. This case may not be about the base monthly fee at all, but rather what happens if you don't pay.

More troubling still are facts 11 i and vi, which essentially challenge the software licensing model as a whole. Fact 11i reads 'Licensing of the online games software disguised as a sale;' while count 11vi reads 'Termination of the right to use the online games for late payment of fees.' To me, this reads that they're challenging traditional software retail and MMO sales as a deceptive trade practice because buying the game doesn't actually purchase a copy of the game nor the right to play. The latter is certainly the weaker point, as I'm fairly certain the box references the required monthly subscription. Normally I wouldn't put stock in an attempt to redefine the entire software industry, especially in California where so much software is developed, but the California courts have been known to issue unusual decisions and have long favored consumer protection.

Count vii, which contests the terms of use, seems like a dead end unless the entire software licensing model is shot down by the court. The Terms of Use are an extension of the license, and if the license is upheld, then the terms of use will be. Other cases have failed to strike down either (other than with regard to things like arbitration provisions), so I doubt this will be successful.

It will certainly be interesting to see the claims in the suit fleshed out further. Based on the information available, this looks like a case of 'I bought the game, didn't pay my monthly fees, and are mad that you won't let me play and are charging me interest on the fees I owe you.'

LGJ: If 24 songs = $1.9 million, then 1 game = ?

2009-06-25T09:56:00.002-05:00

On this week's LGJ, a discussion of the RIAA's recent victory and what it may mean for statutory damages across the board.

Read on!

LGJ: The Anti-Trust Game

2009-06-18T09:39:00.001-05:00

Does the game industry have some reasons to worry about anti-trust? Perhaps. Check out this week's LGJ to learn more.

Read on!

A Video and An Announcement

2009-06-17T13:35:00.003-05:00

First, I wanted to let everyone know that video from the Play-Machinima-Law conference at Stanford Law School is now available online. For those looking to view the panel I was on, here is the direct link.

Second, some of you may have noticed a few small changes on Law of the Game, and they hint at the announcement that I'm formally making in this post. The Vernon Law Group has officially joined Munck Carter, LLP. I had been waiting for the press release to appear, but now that our bios have been at least partially moved to the new site, I thought it was appropriate to make an 'official' announcement on Law of the Game. For those who may be concerned about the move's impact on this blog, rest assured Law of the Game and LGJ will continue in essentially the same manner they have in the past.

LGJ: Is the NDA still viable?

2009-06-11T11:54:00.002-05:00

In what's becoming a bit of an E3 tradition, the latest LGJ talks a little more about the non-disclosure agreement, and some of its shortcomings.

Read on!

SGC Ticket Presale Ending Soon

2009-06-10T11:45:00.003-05:00

For those of you who want to catch "The Debate of the Century" and haven't purchased your SGC tickets yet, I wanted to remind you that you only have until June 19 to purchase pre-sale tickets at $40. After that, tickets at the door will be $50.

The debate is set for July 4, 2009, at 4:00 PM.

Tickets (convention badges) are available at the ScrewAttack Gaming Convention website.

Virtual World Money Laundering

2009-06-03T14:37:00.002-05:00

A few months back I posted a link to a gold farming study by Myke Sanders, a fellow Dallas IGDA board member. Well, Myke just forwarded me his new article on the use of virtual worlds for money laundering. A full PDF is available here.

When I had envisioned use of a virtual world for money laundering, I had always anticipated use of a front business in, say, Second Life such that 'dirty' money is used to buy Linden Dollars that are used to buy virtual goods, and then the front business cashes out the Linden Dollars for 'clean' money. Use of things like prepaid debit cards could even facilitate the laundering of dirty cash.

Myke has a background in credit card processing, however, and came up with an entirely different mechanism based on where the transactions couldn't be traced. While it could also use prepaid cards, it could also be used to generate cash from stolen cards.

As an interesting sidenote, Myke and I were discussing this very topic, and he suggested that the same methodology described in this paper could be used to put gold farmers out of business based on the number of chargebacks they would receive. Of course, that would be highly illegal.

In terms of solutions, I'm not sure his suggested idea of tracking transactions in virtual goods is practical, and even if it were, I don't know that it would be applied to item drops later picked up by other players. More importantly, as Myke pointed out to me, what if an organized crime group created their own MMORPG which they used for laundering, and simply didn't track transactions for that reason.

It's certainly an interesting issue to think through, and I'm not sure there's a readily available answer. I've seen other papers propose all sorts of solutions to the more traditional laundering I've mentioned in the past, but this newer methodology Myke describes is much harder to deal with.

LGJ: Supreme Court Decision Doesn't Bode Well

2009-05-30T16:16:00.002-05:00

This week's LGJ gets into a recent US Supreme Court decision and how it may offer a glimpse of how the court could potentially treat similar issues in games, future interactive broadcast TV, and even a bit about potential new justice Sonia Sotomayor.

Read on!