Law of the Game

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!

Feature on State Bar of Texas Blog

2009-05-29T15:27:00.003-05:00

A recently posted article on the State Bar of Texas blog about Machinima Law features me fairly prominently. While there is a bit of a misquote with regard to the origin of machinima (it should say Quake, not Halo, though Halo certainly popularized it), it's an interesting piece. I really do think Texas is the unofficial machinima capital, since id and RoosterTeeth (the source of Quake and the most successful machinima studio) are both based in the state.

Check it out.

LGJ: A case of tortious interference

2009-05-21T17:17:00.002-05:00

This week's LGJ is a little primer on tortious interference.

Read on!

Virtual Currency

2009-05-19T11:43:00.002-05:00

CNN.com ran a piece on virtual currencies today, which includes a quote from me. I thought you all might find it interesting.

Article on CNN.com

Intellectual Property 2.0: Convergence of Copyright and Trademark

2009-05-14T10:44:00.000-05:00

In discussions I’ve had with various others in all aspects of the intellectual property realm, I’ve continually run across points where the law has lagged behind the practicality of intellectual property management. This has been an ongoing problem in the IP realm with respect to issues created by technology, but issues do extend into other areas as well. In order to outline some of these issues and possible solutions, I will be occasionally posting articles in my Intellectual Property 2.0 series.

I can’t imagine that those who created our copyright and trademark laws envisioned the world we live in today, where the entertainment industry has become a megalith dominated by ongoing brands as much as it is by individual works. It is to this end that we have seen some unforeseen consequences. Copyright continues to be extended, negating much of the original intent that works pass to the public domain. However, should these works ever pass into the public domain, a new issue would immediately be born. To the extent that many of these works are also the matter of trademark for the company, they are, in essence, still not in the public domain. By the same token, should Congress continue to extend copyright, they never will be. But is there a solution? Within the practical bounds of intellectual property as we know it, not exactly. However, if the legal system is willing to move forward into a more modern intellectual property scheme, then we can solve both issues simultaneously.

This new idea is something I would refer to as ‘Copymark.’ In short, to the extent a copyrighted work is also the subject of a registered trademark, the copyright remains intact until the trademark lapses. By creation of this new category of intellectual property, you resolve two issues. One, copyright need never be extended for a concern related to the ‘brand.’ Two, those with copyrights that overlap with their trademarks no longer need to be concerned with the fate of the brand once the copyright expires. In order to balance rights, though, there would of course be a catch. To register for copymark, one must forego traditional copyright and trademark filings, and as a result, should the copymark lapse, the work would go immediately into the public domain regardless of the ‘life of the author plus 70 years’ or other expiration provisions of copyright law. More than likely, copymark status would be a filing once both the trademark and copyright are established, and the filer would have to forego their existing copyright and trademark rights in order to secure the new registration.

The concept would really only have appeal or application to those within the entertainment realms. After all, the IP is only applicable to instances when both copyright and trademark to the same IP. Unless you are already in an industry which deals in copyrighted works, then the copymark would never even be an issue. Conversely, unless you develop products and a brand that associate with a copyright, then copymark would never be available. Whether or not a ‘famous’ element would be a consideration is yet to be seen. In short, this is more or less a solution for the Disneys, the Microsofts, the Nintendos, and other big players whose copyrighted characters are also synonymous with the brand itself.

Taking a practical example from the world of gaming, let’s look at Mario. Mario is the subject of many of Nintendo’s trademarks and is more or less synonymous with the Nintendo brand, much like Mickey Mouse and Disney. Well into the future, is there any major benefit for the original Super Mario Brothers to pass into the public domain when the original Mario 8-bit sprite is still the subject of trademark? Similarly, would it be practical for Steamboat Willie to enter the public domain while Mickey Mouse is such a closely protected trademark? From a practical standpoint, not really. Assuming the rights holder is looking to aggressively protect the brand, use of the public domain character would be attacked on trademark grounds, and potentially with good reason. Any game you encounter with Mario in it is expected to be a Nintendo creation. Brand identity has moved beyond traditional trademark notions with respect to entertainment properties. Copymark resolves the incongruity of copyright and trademark with respect to entertainment products.

I can only imagine that many on the intellectual freedom side would, on principal and face value, oppose this idea. However, it is worth pointing out that much like the source intellectual properties, copymark would require fair use provisions. What exactly those provisions would entail would likely be the subject of a lengthy debate, however, elements of both copyright and trademark fair use theory would need to be present. Elements like critique, news reporting, and brand identification would be easily preserved under a copymark regime. In fact, it may even be an opportunity to introduce newer fair use provisions that are appropriate to these IPs.

It may be expecting a lot to see a tectonic shift in well established intellectual property regimes, but it is inevitable that new problems will require new solutions. The entertainment brand as we know it did not exist decades ago, but it is a near certainty that it will continue in this manner for decades to come. The printing press gave rise to copyright, and the guild system gave rise to trademark. It only seems to follow logically that the changes to the entertainment ‘brand’ would give rise to a new intellectual property regime, since intellectual property is the backbone of the industry itself. I can only imagine that companies like Microsoft and Disney might jump at the opportunity to see some of their most prized IPs protected throughout their useful life, rather than having to re-lobby Congress before certain copyrights are set to expire. It's difficult to predict whether an idea like this might ever truly be implemented, but unless people are willing to think outside the traditional intellectual property box, problems like these will be perpetual.

Reminder: Speaking at Play-Machinima-Law Conference at Stanford

2009-04-23T14:45:00.001-05:00

As a reminder, I've been invited to speak on a panel at the Play-Machinima-Law Conference at Stanford on April 24-25, 2009. I will be on the The Rules of Play: The Role of the EULA and other issues in Machinima Creation and Distribution panel, which is at 1:15 pm on Friday, April 24th. If you're in attendance, please come by and say hello.

GameStop Follow-Up Post

2009-04-14T13:04:00.004-05:00

I wanted to post a short follow-up to my GameStop Employee Checkout piece, based on some comments I've received. I did first want to point out that GameStop is evidently reviewing its policies in this regard, so I doubt we've heard the last about this.

First, my suggestion to reprint box art has been brought up a number of times, and I wanted to point out that I expressly said 'with permission.' I can't imagine publishers having issue with the proposed practice, as it would be to sell their products. Additionally, I only mentioned making dummy boxes as one potential solution, albeit one with a high upfront cost to outfit each store with a set of blank boxes and the ongoing cost of reprinting paper inserts as new games are released. Another, possibly more cost effective solution would be to create cardboard cards with the front and back of the box replicated on the cardboard. I have no idea which would cost more, or what other solutions might work, but the point was to suggest a solution by which no new games would need to be opened and gutted or placed outside the safety of the behind the counter locking cabinet.

Second, I can certainly understand why people would be upset to receive an open game, or even be unable to accept one in certain circumstances (i.e. gift giving). However, I still think that if the plastic seal is not a major issue, there is no difference in the game experience between a perfect condition new disk and a perfect condition disk played once by an employee, besides the potential public relations issues. Of course, when I say perfect condition, I mean everything: kept in a smoke free environment, free of dirt, not kept in direct sunlight or damaging temperatures, etc. I believe that's a major factor as to why the GameStop employees I've known are far more likely to check out a used title than a new one.

Finally, for the record, I do shop at GameStop frequently, largely because it's the only retailer where I have been able to consistently pre-order and pick up on release date high demand titles, limited edition titles, obscure titles that don't tend to show up much if at all in big box stores (i.e. new releases by NIS), and new hardware. I haven't personally had any problems with the stores I've frequented over the years, including the GameStop store near my home I currently use. Perhaps this, like other situations, varies a lot based on individual store management, but it's difficult to say.

Speaking at Play-Machinima-Law Conference at Stanford

2009-04-12T14:16:00.002-05:00

I've been invited to speak on a panel at the Play-Machinima-Law Conference at Stanford on April 24-25, 2009. I will be on the The Rules of Play: The Role of the EULA and other issues in Machinima Creation and Distribution panel, which is at 1:15 pm on Friday, April 24th. If you're in attendance, please come by and say hello.

LGJ: Is game censorship the new trade barrier?

2009-04-11T09:00:00.000-05:00

This week's LGJ examines using 'censorship' as a ruse for protectionism. It's a fun trip down international trade lane with a stop at freedom of speech road.

Read on!

GameStop's Employee Checkout and Deceptive Trade Practices

2009-04-10T10:48:00.006-05:00

Kotaku recently ran a piece noting that the FTC may be interested in the 'employee check out' policy in terms of a deceptive trade practice. The article goes into some detail about the ability of GameStop employees to check out titles from the store on a temporary basis, and in the event these titles are 'new,' then they are brought back in and resold as new. It certainly poses an interesting question: is that a deception to the consumer?

Before talking about substantive law and my take on the issue, I did want to point out one particular clause in the policy, as posted by Kotaku: "If the product is returned in unsellable condition, or if anything is missing from the package, or if the product is not returned, the Associate must purchase the product at the current price less Associate discount." As I have known quite a few GameStop employees over the years, I know that this part of the policy greatly deters the checking out of new games in favor of used ones. After all, even the slightest inclination that a new game isn't 'new' will more than likely force the employee to buy the game, which many of these employees can't afford. A used game has an expected level of wear and tear, so the bar is much lower for the return to store condition.

So, back to the point at hand: is this a deceptive trade practice? There's both a legal and a pragmatic approach to the answer of this question. From a legal standpoint, ignoring any pragmatic analysis, it certainly seems that way from the letter of the law. Certainly, it's something the FTC could investigate, but more practically, it may be a matter for state deceptive trade practices law. In Texas, for example, it is a deceptive trade practice if you are "representing that goods are original or new if they are deteriorated, reconditioned, reclaimed, used, or secondhand."

Of course, the law does not exist in a vacuum, and from a practical standpoint, I'm not sure what GameStop is doing is as nefarious as some people seem to think. The resale of used goods as new rules had a simple policy argument: when they were implemented, practically all goods had a limited useful life, and any use of them would lessen that useful life. If I re-sold a used console, the console's useful life has diminished. If I re-sold a used TV, that TV's life has diminished. That's not exactly the case with a DVD based media. DVDs do in fact deteriorate, but that's something with a clock that begins from production based on normal biodegrading. If a disk has been properly used in a machine and properly handled, has its life been diminished? I haven't seen any data to suggest that it's anything at all, much less anything significant.

Obviously, if the disk, packaging, or other materials are damaged in any way, or if one-time use download codes are used during the check-out, there is no question that reselling that as new would likely be a deceptive act. Of course, the damages would be relatively minute ($5 or so based on the average new release's used price), which could provide difficulty in generating an actual lawsuit over the issue. However, when the disk is cared for and no damage comes to any aspect of the product, has its value actually been reduced? No, and the content of the product is still 100% present. It's a little more nebulous with respect to DS games, as the last of the cartridge systems. I don't know if they have a useful life as determined by play time or not.

From a practical standpoint, I still don't see why GameStop hasn't moved to reproducing cover art with publisher permission and just re-using empty cases so that no titles have to be opened. Granted, that would basically limit employee check out to used titles, but I'm not sure that's a huge loss to the average employee as many new releases are in short enough supply to prevent check out by the policy as reported by Kotaku anyway. It will certainly be interesting to see if the FTC takes any action on this matter, but from a pragmatic standpoint, I'm not sure they will based on the facts.

[EDIT: I've posted some follow-up commentary here.]

The Thompson - Methenitis Debate

2009-04-02T11:48:00.003-06:00

It's official. I will be debating Jack Thompson in Dallas, TX on July 4, 2009. The ScrewAttack Gaming Convention (July 3-5) has politely agreed to play host to the event, which was announced this morning. So, start making your plans to join us in Dallas for what is already being billed as "The Debate of the Century," not to mention participate in the rest of SGC, which has some other great guests lined up. The video announcement can be seen below.