Activision has responded in federal court to a lawsuit originally filed in California state court by No Doubt over Activision’s use of the band’s likeness in “Band Hero.” According to Activision, the case implicates federal copyright law, and thus federal court (rather than state court) is the proper place for the litigation.

Previously, No Doubt sued Activision alleging, among other things, that Activision improperly used digital representations of the band members in unauthorized ways in making “Band Hero,” such as the way that the band members sing and dance in-game.

Now, in responding, Activision is denying all accusations of wrongdoing and arguing that all uses of No Doubt’s likeness are within the licensing contracts obtained from the band before the game’s release. Interestingly, there are also allegations that No Doubt’s contract with Activision does not include certain limits on the scope of the license that the licensing contracts of other artists include.

We will continue to follow this case.

With the growing popularity of video game systems such as Nintendo's Wii, Sony's Playstation 3 and Microsoft's Xbox 360, it seems that all sorts of patent holders are coming out of the woodwork to share in a piece of the profit pie. In what is undoubtedly another case of unwanted attention, Nintendo, Sony and Microsoft have been sued by Eleven Engineering, Inc. ("Eleven Engineering") in the District of Delaware for allegedly infringing three patents: U.S. Patent Nos. 6,238,289 ('289 Patent), 6,346,047 ('047 Patent) and 6,684,062 ('062 Patent). Each of the patents pertains to wireless game control devices. Eleven Engineering's complaint specifically identifies Sony's DualShock and Sixaxis wireless game controllers, Nintendo's Wii Remote and Balance Board and Microsoft's Xbox 360 Wireless Controller and Wireless Racing Wheel as allegedly infringing products.

'289 Patent - "RADIO FREQUENCY GAME CONTROLLER"

The '289 Patent is directed to adjusting a frequency of a wireless controller when weakness in signal strength is detected. One or more of the keys on the controller may further be used to manually change the frequency. Additionally, the game controller may include an indicator light that conveys signal strength by amount of time it is on (e.g., a constant "on" light would indicate strong signal strength whereas an intermittent light would indicate a weaker signal strength). Claim 1 is reproduced below as an illustrative example of the ‘289 Patent’s scope:

1. A game controller for communication between a user and an electronic game device transmitting signals to a receiver, comprising:

a portable housing; game controller keys attached to said housing for permitting the user to generate signals;

a radio frequency sender engaged with said game controller keys for transmitting the signals to the receiver; and

a controller attached to said sender for determining a selected parameter regarding the signals and for communicating said parameter to the user.

A point of contention between the parties may involve whether any of the accused controllers communicates a signal parameter to the user. Note that the claim does not require the controller to specifically include an indicator light.

'047 Patent - "RADIO FREQUENCY GAME CONTROLLER"

The '047 is similarly directed to radio frequency communication between a game controller and a game console device. In contrast to the '289 Patent, the claims of the '047 Patent are directed to the transmission of radio frequency signals from a game controller using time domain multiplexed transmissions. Thus, whether Sony, Nintendo and Microsoft infringe the ‘047 Patent may include a determination of whether their wireless controllers use time domain multiplexing transmission protocols. Claim 1 is reproduced below for reference.

1. A game controller system communicating between a user and an electronic game device, comprising:

a portable housing;

a sensor attached to said housing and responsive to operation by the user to generate signals;

a radio frequency sender engaged with said sensor, wherein said sender transmits said signals with time domain multiplexed transmission; and

a radio frequency receiver engaged with the electronic game device for receiving the signals from said radio frequency sender.

‘062 Patent – “WIRELESS GAME CONTROL SYSTEM”

The ‘062 Patent is generally directed to a wireless system for video game control that allows one or more wireless controller to concurrently communicate with a base transceiver. The benefits touted by the ‘062 patent include advantages in the areas of latency, reliability, power consumption and cross platform compatibility. The ‘062 Patent includes 2 independent claims. Independent claim 1 is directed to a combination of features including automatic channel/frequency adjustment and signal transmission using synchronous time domain multiplexing. Independent claim 13, on the other hand, is directed to controller-base transceiver compatibility and suggests a system that offers compatibility amongst multiple types of controllers and base transceivers. The issues surrounding the ‘062 Patent are likely to be more complex and infringement harder to demonstrate than for the other two asserted patents.

It is no secret that Microsoft, Nintendo and Sony have seen their fair share of gaming technology lawsuits in the past several years. For example, both Microsoft and Sony were sued by, and ultimately settled with, Immersion Corp. for use of force feedback technology in their controllers, while Nintendo entered into an out-of-court settlement with Hillcrest Laboratories for its motion sensing controllers earlier this year. Given Microsoft, Nintendo and Sony’s history of IP troubles involving its controllers and video game systems in general, it will be interesting to see whether the parties settle or decide to go the distance.

The case is Eleven Engineering, Inc. et al. v. Nintendo Co., Ltd. et al., Case No. 1:09-cv-00903-UNA (D. Del. filed Nov. 25, 2009). This is more of a hardware case, so we are not actively tracking it further.

Further to our previous report, a motion for reconsideration was filed by MGA Entertainment Inc. and the retailer defendants in this case, and on November 17, 2009, that motion was denied by the U.S. District Court for the Eastern District of Louisiana.

To succeed on the motion for reconsideration, MGA had to overcome a high hurdle. Specifically, under applicable Fifth Circuit law, MGA had to show that there was a mistake of law or fact in the court’s previous ruling, or MGA had to present newly discovered evidence that could not have been discovered previously. See Slip. Op. at 3. In other words, MGA could not prevail by simply relitigating old matters, raising new arguments, or submitting evidence that could have been presented earlier. See id.

In support of its motion, MGA argued that the court, in finding that MGA’s Laser Battle game infringed Innovention’s patent, misapplied the patent claim’s “movable” limitation to the Tower pieces in the Laser Battle game because according to the rules and strategy of the Laser Battle game, the Tower pieces should not be moved during game play.

Unfortunately for MGA, however, the court was not convinced by this argument. Indeed, the court simply cited its previous opinion, where it noted that it was enough that the Tower pieces were capable of being moved, even if the game’s instructions said that they should not be. See Slip. Op. at 4-5. In addition, the court noted that MGA made the same argument on the motion for summary judgment, and it also noted that MGA seemed to be simply disagreeing with the outcome of the court’s previous ruling rather than presenting any mistake or law or fact or newly discovered evidence. See id.

Now that MGA’s motion for reconsideration has been denied, the next ruling in this case will be on Innovention’s motion for a permanent injunction, which the court is scheduled to hear on January 13. We will continue to follow this case.

Innovention Toys LLC (“Innovention”) previously filed suit against MGA Entertainment Inc., Wal-Mart Stores Inc. and Toys R Us Inc. for allegedly infringing U.S. Patent No. 7,264,242, (“the ‘242 patent”) entitled "Light Reflecting Board Game." As summarized by Judge Martin Feldman in his recent order, the ‘242 patent is directed towards a “chess-like board game in which opposing players shoot a laser beam at mirrored game pieces in order to reflect the beam in an attempt to strike (and thus eliminate from the game) an opponent's key playing piece.” MGA Entertainment Inc. (“MGA”) is the manufacturer of the Laser Game which is distributed through Wal-Mart Stores Inc. and Toys R Us Inc. Innovention asserted that the Laser Game infringed independent claims 31, 39, 40, 41 and dependent claims 32, 33, 43, 44, 48, 49, 50, 53, and 54. One of the claims at issue, independent claim 39 recites:

A board game for two opposing players or teams of players
comprising:
a game board, movable playing pieces having at least one
mirrored surface, movable key playing pieces having no
mirrored surfaces, and a laser source,
wherein alternate turns are taken to move playing pieces
for the purpose of deflecting laser beams, so as to
illuminate the key playing piece of the opponent.

MGA filed a motion for summary judgment of non-infringement and invalidity. As part of their non-infringement arguments, MGA asserted that the Laser Battle game cannot infringe the asserted claims of the ‘242 patent because not all the game pieces are "movable." Specifically, MGA argued that game pieces known as “Tower pieces” are intended to remain in a single space during the game. Innovention, the owner of the ‘242 patent filed cross-motions for summary judgment of infringement and validity.

On October 14, 2009, Judge Martin Feldman of the U.S. District Court for the Eastern District of Louisiana granted Innovation’s motions for summary judgment of infringement and validity. The court held that Laser Game was “virtually identical” to the asserted claims. Regarding the “movable” limitation, the court construed "movable" to mean "capable of movement as called for by the rules of the game or game strategy." The court determined that the “Tower pieces” were moveable because “even if the instructions suggest the pieces ‘should’ not so be moved, that capability is nevertheless present.” The decision inherently indicates that sizing the Tower pieces differently from the other pieces as to preclude movement to another position would likely have avoided a finding of infringement.

Regarding validity of the ‘242 patent, the court considered references that disclosed chess-like computer games using lasers. The court first determined that the claims were not anticipated. Regarding obviousness, the court first noted the higher standard required for a finding of invalidy in a motion of summary judgment and determined that the defendants “failed to provide convincing evidence that adapting a laser chess computer game to a physical board game was a design step well within the grasp of a person of ordinary skill in the relevant art, which they suggest is a layperson.”

One of the attorneys for the defendants indicated that they would be filing a motion for reconsideration. The case is: Innovention Toys LLC v. MGA Entertainment Inc., Wal-Mart Stores Inc. and Toys R Us Inc., Civil Action No. 07-6510 (E.D. La.). We will follow this case.

Harmonix Music Systems, Inc., along with a host of game retailers, is asking a court in Tennessee to resume proceedings in a patent suit brought by Gibson Guitar Corporation over the "Guitar Hero" line of video games.

The suit was filed by Gibson in 2008, and alleged that the Guitar Hero games infringed U.S. Patent No. 5,990,405, entitled “System and Method for Generating and Controlling a Simulated Musical Concert Experience.” The claims in the patent were generally directed to simulating participation in a musical performance, and included the following language (claim 1) specifying a “musical instrument”:

a. a musical instrument, the musical instrument generating an instrument audio signal at an instrument audio output, the instrument audio signal varying in response to operation of the instrument by the user of the system;

Shortly after the suit was filed, it was stayed (e.g., placed on hold) because the U.S. Patent and Trademark Office (PTO) had decided to open a reexamination proceeding to reconsider the validity of the patent. It is common for courts to stay cases pending reexamination, since the outcome of the reexamination can alter the patent’s scope (or render it invalid altogether).

During the PTO reexamination, the patentee altered the scope of the claim 1 “musical instrument” as follows:

a. a musical instrument adapted for (i) making musical sounds and (ii) generating an instrument audio signal representative of the musical sounds at an instrument audio output, the instrument audio signal comprising an electrical signal output by the musical instrument that varies in response to operation of the instrument by the user of the system;

This change was made after the PTO rejected the original claim as being the same as another U.S. patent (Zimmerman, U.S. Patent No. 5,488,196, entitled “Electronic Musical Re-Performance and Editing System”). The patentee argued that the Zimmerman patent did not show a musical instrument adapted for “making musical sounds” and “generating an instrument audio signal …” as recited in the new claim 1. The PTO agreed, and indicated that it will be issuing the reexamined patent with the new claim language.

Harmonix feels that the Guitar Hero game does not have the kind of “musical instrument” that will be required by the new claim 1. In its motion asking the court to lift the stay, Harmonix indicates that once the stay is lifted, it will file a motion for summary judgment that the Guitar Hero game does not infringe on this basis.

Harmonix also indicated that it will offer a second basis for summary judgment of non-infringement. That second basis comes from a California court’s ruling in another case involving Gibson and Activision, makers of the “Rock Band” game. In that case, the California court concluded that the Gibson patent simply did not cover interactive video games, and Harmonix will ask the Tennessee court to make a similar ruling.

So now we wait and see if/when the parties take the stage again. The motion to lift the stay seems likely to be granted, since the PTO reexamination proceedings are ending. Once the stay is lifted, we will likely see Harmonix’s summary judgment motion, and that may well signal the conclusion of this case. As a caveat, though, the patentee also added a number of new claims to the patent in the reexamination process, and some of those new claims don't have the "musical instrument" language quoted in claim 1. It remains to be seen whether those new claims become the new center of attention going forward.

The case is Gibson Guitar Corp. v. Wal-Mart Stores Inc., et al., No. 3:08-0279 (M.D. Tenn.), and we’ll keep you posted as we learn more.

Background

Bleem marketed a software emulator that allowed users to play Sony Playstation games on their personal computers. Bleem's emulator appealed both to gamers who did not want to buy a Playstation console and to those who sought the enhanced graphics and higher resolution offered by PC graphics cards. The program was written and marketed by two men who reverse-engineered the code in the Playstation's components in order to mimic its functions on a PC.

While Sony would undoubtedly have liked to strike down Bleem's software itself, the legality of emulation was not an issue before the court. See Sony v. Connectix Corp., 203 F.3d 596, 607 (9th Cir. 2000) (ruling that emulators are not a violation of the copyright laws). The court noted that the availability of emulators such as Bleem may actually increase the sales of games though it hurts the sale of consoles. With most consoles being sold at a loss, one has to wonder if Sony would have been better off with the competition.

The issue before the court was whether the use of screen shots showing scenes from Playstation games in Bleem's advertising amounted to copyright infringement. Screen shots are often included in video game advertisements in order to convey to a purchaser what the game will look like on-screen. Bleem included screen shots in its advertising and packaging comparing games played on the Playstation console and games played using the Bleem emulator on a PC. The comparison was intended to show that the games looked better when played on a PC.

The district court in the Northern District of California ruled in favor of Sony and entered an injunction against Bleem's use of the screen shots. Bleem appealed to the Ninth Circuit.

Fair Use

Sony alleged that Bleem's use of screen shots violated Sony's copyrighted material. Bleem admitted that its screen shots fell under Sony's copyright but argued that their use fell under the fair use exception.

Under 17 U.S.C. § 107, the “fair use” of a copyrighted work is not an infringement. The statute provides four factors to be considered in determining fair use:

(a) the purpose and character of the use, including whether such use is of a commercial nature...;

(b) the nature of the copyrighted work;

(c) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(d) the effect of the use upon the potential market for or value of the copyrighted work.

17 U.S.C. § 107. The purpose of the fair use doctrine is to permit “courts to avoid rigid application of the copyright statute when, on occasion, it would stifle the very creativity which that law is designed to foster.” Campbell v. Acuff-Rose Music, Inc., 510 U.S. 569, 577 (1994). Although the fourth factor is sometimes thought to be the most important, each factor must be considered, and no single factor is dispositive. See id.

1. Character of the Use

In analyzing the first factor, the court determined that Bleem's use of the screen shots represented comparative advertising. Bleem's emulator directly competed with Sony's Playstation console and the screen shots compared the user experience on the two platforms. Noting that the Ninth Circuit had not dealt with comparative advertising, the court referenced a Fifth Circuit opinion finding fair use where a newspaper displayed a cover of TV Guide for the purpose of comparing it to an analogous publication. Triangle Publications, Inc. v. Knight-Ridder Newspapers, Inc., 626 F.2d 1171 (5th Cir. 1980). The court also cited the FTC's stance that comparative advertising is an important source of information to consumers. According to the court, Bleem's use here helped consumers make rational purchasing decisions and could inspire Sony to improve their product.

Due to the nature of Bleem's use as comparative advertising, the court found that the first factor favored Bleem. Bleem's use provided great benefits to the public without a substantial impact on the integrity of Sony's copyrighted work.

2. Nature of the Copyrighted Work

The second factor is often less important than the others; indeed, the Supreme Court has stated that the second factor is often “not much help.” Campbell, 510 U.S. at 586. The Ninth Circuit found that the copyrighted work here was generally creative in nature, but that screen shots were merely inanimate slivers of the game. Without much discussion, the court decided that this factor neither supported nor detracted from Bleem's claim of fair use.

3. Degree of Copying Involved

The third factor recognizes that the closer the copied portion gets to the whole of the copyrighted work, the less likely it is to be fair use. The court analogized video games to motion pictures and characterized a screen shot as representing 1/30th of a second's worth of the video game. The court determined that a screen shot was of little substance to the overall copyrighted work.

The court stated that “the third factor will almost always weigh against the video game manufacturer because a screen shot is such an insignificant portion of the complex copyrighted work as a whole.” Op. at 1028. Here, the third factor supported Bleem's fair use claims.

4. Effect Upon the Potential Market for the Copyrighted Work

The fourth factor, often the most important factor, looks to the impact of the use upon the market for the copyrighted work. Beyond just the defendant's use, the fourth factor considers the impact of unrestricted and widespread conduct of the sort engaged in by the defendant. Campbell, 510 U.S. at 590. The court questioned the existence of a market for screen shots but found that, even if such a market existed, any harm to the market would be the result of critique or have a de minimis effect in light of the comparative nature of Bleem's advertising. Any losses suffered by Sony would not be in the market for its copyrighted material but in its console business.

Finding that Bleem's use would have no effect on Sony's ability to do with its screen shots as it pleased, the court ruled that the fourth factor favored Bleem.

Holding and Conclusion

The court, seeing that on balance the four factors favored Bleem, held that Bleem's use was a fair use and vacated the preliminary injunction imposed by the district court, remanding for further proceedings. The holding was qualified by a caveat that the finding of fair use only applied insofar as the screen shots accurately represented how games looked on the Playstation console. The court made clear that they were persuaded by “the need for Bleem to impose minimally upon Sony's copyright with respect to these screen shots because there is no other way to create a truly accurate comparison for the user.” Op. at 1030.

This case is a good example and good precedent for the use of comparative advertising with respect to audiovisual works, and video games in particular.

Thanks to Scott Kelly for his assistance with the preparation of this case summary

A colleague from across the pond, David Musker of RGC Jenkins, forwarded to me an interesting (and humorous) article that he wrote back in 2007. It's a funny tongue-in-cheek perspective on the technical effect test used in Europe with respect to patentability of business method and software patents. The article uses the fictitious world of "Wasted Life" to illustrate his points, and instead of using business methods, the allegedly patentable (or unpatentable) subject matter is BEER. A good read.

Enjoy the article here.

This litigation has been transferred to the Northern District of California (San Francisco Division). Specifically, NCSoft filed a motion in the Eastern District of Texas alleging that, other than the marketing and sales of the allegedly infringing video games, neither party had any significant connections with the district. NCSoft’s motion noted that these actions were conducted throughout the country and additionally, Worlds.com did not oppose the motion.

The case was subsequently transferred to the Northern District of California. Worlds.com, however, declined to have the case proceed before a Magistrate Judge. The case was assigned to Judge Patel, who conducted a Management Conference held on September 14, 2009. At the Conference, Judge Patel scheduled a Status Conference for March 1, 2010, and ordered the parties to file a joint status report one week before the March 2010 Conference. Judge Patel also reserved June 6, 2010, for conducting the Markman hearing. We will follow this case and provide updates as they occur.

Well, it has finally happened. Someone got so upset that they filed a class action suit against Linden Research, the owner of Second Life.

Nothing major, but it does look like the case management conference was conducted on Sep. 14, and the claim construction hearing, i.e., Markman hearing, has been set for June 8, 2010:

Minute Entry: Initial Case Management Conference held on 9/14/2009 before Hon. Marilyn Hall Patel (Date Filed: 9/14/2009); Claims Construction Hearing reserved for 6/8/2010 09:00 AM; Further Status Conference set for 3/1/2010 03:00 PM in Courtroom 15, 18th Floor, San Francisco. (Court Reporter Christine Triska.) (awb, COURT STAFF) (Date Filed: 9/14/2009) (Entered: 09/15/2009)