Youtube users started reporting this week that Nintendo has started claiming revenue for advertisement on user-created Youtube videos which feature content from Nintendo games. Nintendo confirmed this news stating they became a Youtube partner in February of 2013 and registered their copyright content in the Youtube database. Unlike most infringement cases, Nintendo is not asking Youtube to take down potentially infringing videos. Instead Nintendo is issuing content ID match claims to place its own advertising before, within, or at the end of the videos.
Nintendo is targeted videos featuring Nintendo-owned images or audio of a certain length. The most common videos affected are “Let’s Play” videos. These videos are show gamers playing through video games and can vary from a few seconds of gameplay to entire playthroughs of a game. People upload these videos for humor, to demonstrate how to clear a certain part of the game, or just to show off how good they are. “Let’s Play” channels can boast over 100,000 subscribers and individual videos can reach over 1,000,000 views.
As a copyright owner Nintendo has the exclusive right to reproduce their works and to create derivative works under Section 106 of the Copyright Code. Even though Youtube videos are not copies of the software code of video games a video showing gameplay is still a reproduction. Videos which reproduce clips of a game with commentary by a gamer would be considered a derivate work; even though the video may be original enough for its own copyright it is still based on Nintendo works.
Prominent “Let’s Play”ers have already expressed they believe they are protected by fair use. Fair use, defined in Section 107 of the Copyright Code protects reproductions for purposes such as criticism, comment, and more. Many people argue “Let’s Play” videos qualify for a fair use exception because they do often criticize games and have humorous commentary.
It is very likely at least one “Let’s Play”er will sue Youtube or Nintendo to reclaim future advertising revenues. To evaluate fair use courts will look at the purpose and character of the videos, the nature of the Nintendo games, the amount of the games used in the videos, and the effects “Let’s Play” videos will have on the potential market and value of Nintendo’s games. “Let’s Play” videos widely vary from channel to channel so while some videos could be held to be a fair use others may not.
If you host videos Nintendo claimed advertising revenue for you should seek advice from an attorney. Stone Law handles copyright matters ranging from litigation to registration. You can call our office at 732-444-6303 or leave us a message on our website.
On July 10, 2013 the United States District Court for the Southern District of New York ruled Apple was guilty of anti-trust violations for its role in conspiring with book publishers to raise prices for electronic books. The five publishers, Hachette Book Group, Inc., HarperCollins Publishers LLC, Holtzbrinck Publishers LLC d/b/a Macmillan, Penguin Group Inc., and Simon & Schuster Inc., had already settled with the Department of Justice. Apple moved to trial because it claimed it was innocent. The trial was conducted as a bench trial from June 3 to 20 to determine liability and injunctive relief.
At its heart, the court’s ruling determined Apple played a central role in facilitating and executing the conspiracy to raise e-book prices. In the court’s opinion, without Apple the conspiracy would not have been as successful. Amazon was charging $9.99 for e-book versions of New York Times bestsellers and other newly released hardcover books. Apple met with the five publishers in December of 2009 and January of 2010 and suggested prices of $12.99 to $14.99 for its planned iBookstore. Apple promised to set those prices only if it could get agreements from the publishers allowing Apple to offer e-books simultaneously with their hardcover releases.
At the iBookstore’s launch new release e-books were given price caps of $12.99 or $14.99. Apple gave the publishers control of their prices within those caps and also set a 30% commission, similar to the App Store. More importantly, Apple included in its agreements a price parity provision, also known as a Most-Favored-Nation clause, which would penalize a publisher if they did not force Amazon and other retailers to cede control of e-book pricing to the Publishers. This clause was the key piece of evidence which influenced the court’s decision. It essentially prevented Apple from having to compete with Amazon on e-book pricing. In fact, when Steve Jobs was asked why consumers would not just buy cheaper Amazon books he replied, “The price will be the same.”
As a result of these agreements Amazon’s stock fell 9% after the publishers collectively threatened to pull out from Amazon. After Amazon caved in, the prices for Kindle books rose up to Apple’s prices. Average per unit e-book retail prices rose 14.2% for new releases, 42.7% for New York Times bestsellers, and 18.6% across all books from the five publishers. Macmillan also turned down sales promotions to keep prices up. Eventually Random House, the last big publisher, moved towards the same pricing scheme.
Apple argued at court they were not guilty and showed data that e-book prices moved lower in the two years since. However the court was not persuaded and said Apple’s data did not account for other changes in the e-book market. The court also cited many excerpts from emails which show collusion between Apple and the publishers. The court ruled Apple participated and facilitated a horizontal price-fixing conspiracy, which is per se unlawful. Apple was not able to convince the court the agreements had any pro-competitive effects either.
Apple has already stated it will appeal the ruling. Appeals from the Southern District of New York go up to the 2nd Circuit of Appeals. If necessary, the next step after the 2nd Circuit is the Supreme Court. If Apple is still found liable the parties will move to a trial to determine damages.
If you have an issue related to publication or e-books please contact Stone Law at 732-444-6303 or send us a message on our website.
A federal district judge in New York ruled for the Associated Press in the case of AP v. Meltwater. The ruling, if upheld on appeal, can have large ramifications throughout the blogosphere and for content aggregators.
The Associated Press, or AP, is a not-for-profit group which creates news reports from all over the country. AP’s revenue comes from licensing fees it earns by licensing uses of its articles to newspapers, websites, and other subscribers.
Meltwater is an Internet media monitoring service. Their news service is a method for their clients to keep tabs on how they are portrayed in the press. AP alleged that Meltwater is infringing AP’s copyright by republishing AP articles without a license. Meltwater uses a computer program to scrape news articles on the web and provides excerpts of those stories daily to its subscribers. Meltwater did not dispute that it took content from AP stories that is protected by the Copyright Act. Instead, Meltwater claimed an affirmative defense of fair use. Meltwater argued it is a search engine, albeit one which is a closed system for subscribers only. This case revolves around thirty-three Registered Articles of the AP which Meltwater copied and then delivered excerpts of to its subscribers. Meltwater News employs automated computer programs known as “crawlers” to scan the Internet for news. This is the same method which most search engines will employ. Meltwater’s crawlers scan approximately 162,000 online news websites from over 190 countries each day to create an index of the websites’ content. It is of notes that Google, Yahoo, and other large search engines do have licenses from the AP.
Meltwater argues that they are not liable for their copyright infringement since it is “fair use” of the plaintiff’s copyrighted work.17 U.S.C. § 107 provides that “the fair use of a copyrighted work . . . for purposes such as criticism, comment, news reporting, teaching . . . scholarship, or research, is not an infringement of copyright.” It is important to note that Meltwater did not claim it was ‘news reporting’ as stated in the fair use exception, but rather that it was a search engine. Courts look to four non-exclusive statutory factors to determine whether a defendant has made fair use of a copyrighted work: (1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work. In this case, the first and fourth factors weighed heavily against Meltwater. For the first factor, the district court quote Harper & Row Publishers, Inc. v. Nation Enterp., 471 U.S. 539, 562 (1985), “the fact that a given use is profit-driven is not the focus of the commerciality inquiry. Instead, the “crux of the profit/nonprofit distinction is . . . whether the user stands to profit from the exploitation of the copyrighted material without paying the customary price.” Given that Meltwater charges it subscribers thousands of dollars annually for their service, the purpose and character of the infringement is clearly for profit. For the fourth factor, the court quoted Castle Rock Entertainment, Inc v. Carol Publishing Group, 150 F.3d 132, 145 (2nd Cir. 1998), as the concern of this factor is not with “whether the secondary use suppresses or even destroys the market for the original work or its potential derivatives, but [with] whether the secondary use usurps or substitutes for the market of the original.” Meltwater subscribers would have no use for an AP subscription when Meltwater can provide the same information. This constitutes suppressing the market for the original work.
Ultimately, the court decided that commercial Internet news clipping services do not provide enough of a public service to outweigh the enforcement of the copyright laws and therefore allowing Meltwater a free ride on AP’s reporting cannot be justified
If this ruling is upheld by the appellate court and/or the Supreme Court, then content aggregators and bloggers will need to take notice. The internet is often though of as the wild west when it comes to intellectual property law. There is a fine line between a blog linking to another website with a short description, and a blog wholly copying another website’s posts. For amateur bloggers, this is a small matter of poor etiquette, but for professionals, Meltwater may become a very noteworthy.
Video game publisher Electronic Arts (EA) has challenged video game creator Zynga in California Federal Court. It appears that Electronic Arts suspects Zynga has been borrowing a few too many elements from its game, The Sims Social, and incorporated those elements into the Zynga game, The Ville. From EA’s complaint it appears that various design elements of The Sims Social were copied directly into the Zynga game. A few months ago it would have seemed that EA had an uphill battle on their hands but a recent case may have shifted the verdict in EA’s favor. That recent case involved cloning the popular game Tetris (See Cloning Tetris). It would be wholly unsurprising if EA’s recent action was spurred by the verdict of the Tetris case, firstly because of the many common elements with EA’s case against Zynga and the Tetris case and secondly and more importantly, the connection that EA has with the owner of the rights to Tetris. It may be that EA’s actions against Zynga were started as a result of the Tetris case or it may be that the Tetris case was a result of some agreement that EA has with the owners of the rights to the Tetris game.
The Tetris case and the EA case may be the start of a new line of litigation targeting the makers of clone video games. Whatever the motivation for these recent litigation events was, or what entity was behind the suits, it now seems that those video game manufacturers copying substantial elements of other game manufacturers are no longer safe from infringement claims. Although it has always been the law that copyright can not and should not protect the underlying idea behind a work, the expression of that idea can be protected. The central issue in the Tetris, and most likely in the Sims Social case, was whether the underlying idea of a game can be separated from the expression of that idea; the idea of watching someone’s life and controlling it in a video game may not be protectable, but the interface for doing so seems as if it should be.
The commonality which is shared between The Sims Social and The Ville appears to go beyond the mere superficial, as shown on page 20 of the attached complaint, the skin tone choices in both games is identical. Somehow it appears that Zynga has independently picked the exact same eight skin pigmentation representations as EA, in addition to the fact that Zynga also appears to have chosen to allow the same number of skin pigmentation representations. Unless there is some universal skin color chart which is given to first year computer programmers it seems that these similarities can not be coincidental. There are numerous other design choices which carry over from the EA game into the Zynga game which appear to defeat any argument that the Zynga game is at least a partial copy of the EA game.
It cannot be said for sure that The Ville is a copy of The Sims Social, that is something which the court will have to decide. It will be interesting to see what Zynga’s response to the complaint is and whether they can explain some of the many similar choices which the developers of both games chose.
On May 30, 2012, a Federal District Court in New Jersey granted summary judgment to Tetris in an infringement case against Xio Interactive, Inc. for their iPhone game “Mino.” In Tetris Holding, LLC v. Xio Interactive, Inc., the judge ruled that Xio infringed upon Tetris’ copyright and trade dress. The decision is an important gain for game developers, who are often offered little protection against infringement by game studios who produce clones of popular games for profit.
Many game developers have trouble protecting their intellectual property rights against companies who create clone games to cash in on successful designs. Clones copy the look, feel, and mechanics of a popular game for a profit, but, until recently, the original developers had trouble proving these clones crossed the line into copyright infringement. Often, developers like Xio successfully argued that they copied only functional elements of the game, such as the underlying rules or theme, and not that game’s particular expression of them. The New Jersey court ruled for Tetris, however, holding that Xio’s clone copied various parts of “Tetris” that may have been acceptable individually, but, taken together, constituted infringement.
While the holding is well argued, the court may also have ruled for Tetris after Xio openly admitted to downloading Tetris’ own iPhone game when seeking to create “Mino.” While they did not copy the actual underlying coding for Tetris’ game, Xio did not deny widespread copying of Tetris’ features and design. Additionally, Xio did not deny spending money to research copyright law and concluding they could imitate “Tetris” if they stuck to the game’s functional elements.
For this conclusion, Xio leaned heavily on the merger and scenes a faire doctrines to conclude that most of Tetris’ content could not be protected. Since only expression is copyrightable, the underlying ideas of a game are not protected. For example, while “Mario” is protected from wholesale copying, creating a game around an Italian plumber who saves a princess might not be copyright infringement. Stemming from this expression/idea theory, the doctrine of merger limits copyright protections when there are few ways of expressing a given idea. Since the expression and idea are so closely related, if the law offered standard copyright protection, the copyright holder would receive a near monopoly on the idea. To avoid these idea monopolies, the merger doctrine reduces copyright protection when an idea and its expression merge. Similarly, Scenes a Faire limits expression that is widely used and commonly associated with a given genre. Relying on these two doctrines, Xio argued that any expression found in “Tetris” is unprotectable since it is so closely related to the game’s underlying rules and ideas.
The judge disagreed, however, and held that Xio’s theory would only preclude protection for expression that is inseparable or integral to an idea. Xio’s articulation of merger and Scenes a Faire is dangerously broad and could have precluded any protection whatsoever for game developers. The court’s adoption of a narrow view ensures that developers will be protected while also preserving merger and Scenes a Faire for difficult cases where an idea and expression are almost inseparable.
Specifically, the judge found Xio copied the individual Tetris pieces, the dimensions of the playing field, the display of garbage lines, the appearance of shadow pieces, the display of the next piece, the color changes when pieces land, and the playing field automatically filling in when a player loses. The court found this expression was not inseparable from the underlying ideas of the game, and while taking a single one of these elements may not have been infringement, Xio’s wholesale replication constituted copyright infringement.
The court also held that Xio infringed on Tetris’ trade dress in creating “Mino.” Trade dress is a legal protection designed to protect consumers from purchasing goods that imitate another product. Trade dress tries to prevent knock-offs and counterfeits from being sold as the genuine product. Xio similarly sought to argue that Tetris’ trade dress was functional and did not deserve protection. The court also rejected this argument and held that many of the design choices in Tetris are not related to function.
While many have expressed concerns that the decision will stifle creativity and encourage copyright holders to pursue frivolous lawsuits, the decision will help protect copyright holders against clone producers like Xio. Given Xio’s unapologetic, wholesale reproduction of “Tetris,” there is a good chance that this decision will not harm genuinely new creative games that simply share elements or inspiration with their predecessors.
Thanks to a New Jersey court ruling, if you’re one of the many people who check their personal email at work, you might be concerned. Forgetting to log off a public computer could be even more stressful after a jury found that failing to log off constituted tacit authorization to snoop around. The case, Marcus v. Rogers, included excerpts from the emails in question.
On June 28, a New Jersey Appellate Court affirmed a lower court’s ruling in a digital snooping case in an unpublished opinion. The court found no error in a trial judge’s refusal to grant summary judgment for the plaintiffs based on the evidence presented throughout the trial.
The defendant, a teacher, sat down in the computer lab of the school to check his email before work. When he put down his drink on the desk between two computers, he woke up the inactive computer next to him and revealed another teacher’s private email. After noticing some of the messages in the Yahoo inbox mentioned him, the defendant read and printed the emails. He then confronted the plaintiffs with the emails. The plaintiffs filed a claim under N.J.S.A. 2A:156A-27, which prohibits unauthorized access of computer files or emails.
At several points during the trial, the plaintiffs moved for summary judgment, but the trial judge refused to grant them based on the evidence. A jury eventually heard the questions of whether the defendant had “tacit authorization” to access the account and whether the defendant exceeded such authorization. All seven jurors found that the defendant had been granted tacit authorization to view the email after the plaintiff failed to log out, and six of the seven jurors found that the defendant did not exceed the tacit authorization by accessing and printing the messages.
The court also found that the various motions were properly denied since there was little evidence of any damage to the plaintiffs. All plaintiffs remained employed and were reelected to their teachers’ association positions. The appellate court said that the jury was free to discredit any testimony presented by the plaintiffs that their reputations were harmed.
The Appellate Court found that the evidence throughout the trial did not support a grant of summary judgment for the plaintiffs and refused to address the plaintiffs’ remaining objections in a written opinion. The court ruling will certainly make people check twice before getting up to leave a public computer, and although the ruling might seem like a grant to read through your friends’ email, it’s best to stay on the safe side and keep out.