Tag Archives: intellectual property

Real World Items in Games

When creating realistic video games, developers often desire to render real-world items digitally but neglect considering rights held in these items.  A failure to investigate rights held in real-world items is not limited to smaller studios as major developers (ex. Activision) have been sued for using real-world items in their games, such as AM General’s Hummer and certain firearms.   To assist in avoiding these issues, consider the following steps when inserting real-world items into your game:

  1.  Check to see if the item you are adding to the game is based on a real-world item.  For example, modes of transportation, firearms and luxury goods in games could all be based off a real-world item.
  2. When purchasing assets from marketplaces be sure to ensure that the asset creator has not  infringed the rights of third parties.  This has been an issue on the UE marketplace leading to an audit of most firearm asset packages.
  3. If your item is based on a real-world item, determine the rights held in that item.  For example, the design could be covered by a design patent while the name or logo could be trademarked.
  4. If there are rights held in the item be sure to secure a license from the rights holder before proceeding, otherwise you risk litigation and will be running afoul of most representations and warranties contained in publishing and platform agreements you sign.

In many cases, it’s cheaper to design your own items rather than seeking a license for real-world items, which may not be granted.  Take the GTA series and its use of cars of its own design – it’s doubtful that an automaker would license their rights to a game in which the same car is used to commit (digital) criminal offences, including murder.

If you are in doubt whether the particular item or its name is protected, be sure to contact your legal counsel before spending time integrating it into your game.

You Need a Streaming License

Streamers are increasingly important to the success of indie video games and our clients often encourage streaming as a way to increase exposure without substantial expense.  However, recent streamer controversies illustrate the need for developers to include an explicit streaming license and code of conduct within the game’s End User License Agreement (EULA) with broad grounds for termination.

What is a streaming license?  A streaming license expressly grants users a license to stream the video game but makes it clear that this license can be revoked at any time, without notice or compensation.  Without this language, substantial ambiguity remains concerning the scope of the license and impact of termination.  Consider the following example:

DEVELOPER grants you a license to publicly display the Game on online video streaming websites, such as youtube.com and twitch.com, and social media, such as tweeting a GIF. DEVELOPER may terminate or modify the scope of this license at any time without notice or compensation and will not be liable to you or any third party for any loss incurred relating thereto.

You can also draft the license to fit your company’s particular needs.  For example, the streaming license could prohibit monetization of the stream.

Do you have a Code of Conduct?  In addition to a streaming license, we recommend that the EULA contain a user code of conduct that prohibits certain conduct, such as profanity, nudity etc.  Breach of this code could provide a basis for terminating a user’s streaming license, although not the only basis.

Can’t I just use the DMCA?  Yes, a Digital Millennium Copyright Act (DMCA) claim is the quickest way to secure removal of a stream and  a clear streaming license (with termination language) provides a clear basis for making the DMCA claim.  Without a streaming license, unnecessary ambiguity remains concerning the impact of termination (for example, could liability follow if you terminate a lucrative stream that was previously permitted?).

In sum:  It benefits your streaming community to receive a clear streaming license and to understand the basis upon which the license can be used and revoked.  While you can remove an offensive stream without such a clause (under the DMCA), ambiguity does little to benefit your company or streaming community.

UI/UX Invalidated your Contract

Online contracts are only effective if implemented correctly.   I’ve written on different processes for implementing online contracts, which is often easier to accomplish in the web context.  In the mobile context, implementation is challenging given the need to balance user experience with contract formation.

How you structure contract formation in your mobile application involves negotiation between the UI/UX team and legal counsel and a balancing of user experience against the risks of the contract unenforceability.  With millions of DAU, the risks are enormous.

A recent case illustrates this risk and shows that even sophisticated startups can run the risk of a weaker contract formation process and be burned.  Lyft presented users with this acceptance screen:

LI Image

It includes the typical web approach to contract acceptance, with a check box stating: [I agree] to the Terms of Service (link).  Recently, a NY court determined that this process did not clearly indicate to users that a contract was being agreed to.  The combination of a series of “Next” screens, the small size of the contract formation text (relative to the large, pink “Next” button) and that the contract was presented in the context of an unrelated phone number request all contributed to the court’s conclusion that users were not sufficiently notified of what they were agreeing to and, as a result, did not accept the Lyft Terms of Service.

Luckily for lyft, prior to the lawsuit, a new contract formation process was implemented, one I’ve advocated for myself:

One mobile approach is to present the agreement to the user, require that they scroll through the agreement and, once scrolled through, the user is presented with the following button at the bottom of the page:  [I agree] to the Terms and Conditions.

Take away:

  1.  At a minimum, mobile applications should have prominent language indicating that a contract is being presented to users (ideally as a separate screen labeled “Terms of Service” or similar).
  2. Contract language should be noticeable and not blend into the background as a user registers for the application.  Try to alter the flow of the registration process so the user recognizes that something new is occurring.
  3. Any button on the contract page should state “I agree” or “I accept”, rather than “Next” and this button should not overwhelm the contract link.

In my opinion, the scrolling process described above is one of the better approaches for implementing a contract into a mobile application.  Other approaches are available but your UI/UX team needs to work with legal counsel to ensure that design considerations do not overwhelm contract enforceability.

Your DMCA Registration is Expiring

The US DMCA (Digital Millennium Copyright Act) contains very useful provisions that provide a company with a safe harbour (in the U.S.) from copyright infringement committed by users of the company’s website or other online service.  For technology companies, especially those that permit users to contribute content, this safe harbour is invaluable as, without, liability for copyright infringement committed by users could be a financial disaster – imagine the liability a video upload site could incur.

To be granted the safe harbour, your company must comply with a number of legal requirements, including:

  1.  The posting of certain information concerning a notice-and-take-down process for alleged copyright infringing content, counter-notice to challenge an allegation and compliance with this process; and
  2. Registering your online service with the US copyright office and registering a DMCA agent, who acts as the point of contact for DMCA/copyright infringement claims.

Previously, DMCA agent registration did not expire.  Due to changes in the regulations governing DMCA agent registration, all current DMCA registrations expire on December 31, 2017.  Going forward, companies may register DMCA agent information electronically, each registration being valid for 3 years.  A failure to re-register a DMCA agent will result in the loss of the DMCA safe harbour, even if you previously registered and no change occurred with respect to that agent.

The benefits to the DMCA safe harbour greatly outweigh the minor costs involved in registering a DMCA agent.  Accordingly, we recommend registration to our Canadian clients, even if they do not have a presence in the U.S.  If your company has already registered, be sure to contact your legal counsel to timely begin re-registering your DMCA agent.