Patent Arcade

Case: In re Bilski - Federal Circuit oral argument

2008-05-08T16:01:00.002-05:00

The status quo is that video game play methods are patentable subject matter, provided the game play methodology is new, useful, and nonobvious. Never before has there been a case with the potential to limit video game patents as with the In re Bilski appeal. Today the Federal Circuit heard oral arguments in this case, en banc (i.e., the entire court), including arguments from two amicus parties, which is almost unheard of. A summary of today's arguments is provided below, as prepared by Bradley C. Wright of Banner & Witcoff. The views expressed in this posting are the views of Mr. Wright, and not necessarily the views of Banner & Witcoff:

FEDERAL CIRCUIT MAY CLAMP DOWN ON PROCESS PATENTS

by Bradley C. Wright

Banner & Witcoff, Ltd.

On May 8, 2008, the U.S. Court of Appeals for the Federal Circuit held a rare en banc hearing to determine what constitutes a patentable process under the patent laws. The appeal was from the U.S. Patent and Trademark Office (PTO), which had rejected Bilski’s patent application for a method for managing consumption risk costs of a commodity. The claimed process included three steps involving various transactions between a commodity provider and market participants in a way that balanced risk. The PTO rejected the patent application on the basis that it was not a “process” as that term is defined in the patent statute and earlier court decisions. According to the PTO, in order to be patentable, a process must either be tied to a particular machine, or it must transform a tangible article to a different state. Because Bilski’s claimed invention did neither, it did not meet the definition of a “process.”

Bilski’s attorney argued to the court that a process should be patentable if it produces a “practical result,” regardless whether it is tied to a machine or transforms something tangible. According to Bilski’s attorney, the various transactions recited in the claim were very specific and involved real-world activities. Several of the judges appeared to have difficulty agreeing with Bilski’s proposed “real-world” test for patentability. Bilski also argued that the more specific a patent claim is, the less likely it is to constitute an abstract idea, which the Supreme Court has stated is unpatentable. Several of the judges also appeared to question whether the “useful, concrete and tangible” test seemingly created in its earlier State Street Bank case provided a workable standard to judge patentability, but Bilski’s attorney endorsed the continuation of that standard.

Professor Duffy argued on behalf of the Regulatory Data Corp., one of many amicus parties in the case, that the PTO has taken too narrow a view of what is a patentable process, and urged the Federal Circuit not to draw any bright-line rules. Instead, Duffy proposed that the court look at various factors to determine whether a process was patentable. He argued that the breadth of the claim should be one factor to consider, and seemed to agree that the degree to which the claim was connected to “real-world” activities could be another factor, but the judges seemed to have difficulty eliciting a clear list of factors that should be considered or which might be more important than others. He also criticized the requirement that there must be something tangible and physical in order to constitute a patentable process. Some of the judges appeared to have difficulty accepting the lack of any concrete standard under this “factor-based” test.

The PTO argued that the U.S. Supreme Court decision in Diamond v. Diehr made it clear that in order to be patentable, a process must either be tied to a machine or must transform physical subject matter. The judges explored whether throwing a baseball “transformed” the baseball in a patentable way, which the PTO answered in the negative. One of the judges asked whether a method of performing chiropractic might constitute a patentable “transformation,” but the PTO did not take a position one way or another on that question. Some of the judges expressed concern that adopting a rigid rule might eliminate patents on software, but the PTO responded that most software implemented on computers would still be patentable because they transformed the computer and the software was tied to a machine. Chief Judge Michel pointed out that the Supreme Court had previously ruled that not every process tied to a machine would be patentable if there was insignificant “post-solution activity.”

Bill Lee argued on behalf of the financial services industry (another amicus) that the court should adopt a factor-based test based on three principles: First, abstract ideas and mental processes should not be patentable. Second, a process involving a physical transformation of matter would normally be patentable, but he rejected the idea that throwing a baseball “transforms” the ball in any way. Third, a process that is tied to a physical machine in a non-conventional way might be patentable, but not if it was tied in a conventional way. Several of the judges questioned whether “non-conventional” should be an added requirement for a process, given that every process must already be novel and nonobvious in order to qualify for a patent.

Finally, Bilski’s attorney in rebuttal argued that the information recited in Bilski’s patent application constituted something that was “physical” and he reiterated his point that there was real-world interaction recited in the claim, which was all that was needed to satisfy State Street Bank’s “useful, concrete and tangible” test.

Although it is difficult to predict what the court might say in ruling on Bilski’s patent application, it seems likely that the PTO’s decision will be upheld and Bilski’s claim to a method of managing risk will not be deemed to be patentable. Two of the judges appeared to take a broad view of patentable subject matter, leaving patentability to be determined under the remaining the standards of novelty, nonobviousness, and definiteness. Several judges appeared concerned about eliminating broad categories of invention such as computer software or financial industries. Some of the judges seemed concerned about allowing process patents only where the process was tied to a particular machine or transformed subject matter in some way. But a majority of the judges appeared to have difficulty accepting that Bilski’s claim was something that the patent laws were intended to cover.

In this author’s opinion, the most likely outcome is that the Federal Circuit will create two safe harbors for process patent patentability, and leave open the door to future technological developments that might fall within additional safe harbors. The two safe harbors would be that a process involving steps tied to another category of invention (e.g., a machine or a composition of matter) could be patentable, and a process that transforms something tangible could be patentable. Mere manipulation of numbers, without more, would not be patentable. Bilski’s claim, which seems to recite intangible principles of arranging a financial transaction in a certain way, would fail the test. Similarly, patents involving methods of playing sports or other activities lacking machinery or other tangible things might not survive the court’s decision. But the court is likely to tread carefully so that it does not wipe out patents in whole industry areas, such as banking and computer software. And the court will likely refine its earlier State Street Bank decision to clarify that “useful, concrete and tangible result” is not enough for patentability.

News: Korean Copyright Suit over Advent Rising

2008-04-15T07:23:00.002-05:00

I don't normally track foreign video game cases, but perhaps I should. However, it does make one more category of work for me in view of all my regular work and blogging efforts. If only I had some help... In any event, a reader (thanks Tim!) passed this morsel along, and its worth sharing.

Square Enix, the company best known for the Final Fantasy, Dragon Quest and Kingdom Hearts titles, recently won a copyright infringement lawsuit in South Korea over Fantom Entertainment Group over unauthorized use of scenes from Square Enix’s Final Fantasy VII: ADVENT CHILDREN, a CG-animated film. According to the press release, “the amount of damages awarded [300 Million Korean Won] … in this case is the largest the courts in South Korea have ever awarded in cases infringing one single work of art.” Square-Enix’s GC remarked that “Square Enix will continue to take decisive action against any infringements upon the Company’s intellectual property, recognizing that this property is one of our most crucial resources."

The infringing subject matter at issue has to do with a scene from FFVII: Advent Children, and a music video from Korean singer Ivy in the song “Sonata of Temptation.” The Korean singer appropriated the content from Square-Enix without their permission or authorization. Below are the links to the respective videos; the similarities between the two are immediately apparent, and quite striking.

Original Content from FFVII: Advent Children

Ivy - Sonata of Temptation (Music Video)

Square Enix Press Release

(Thanks to Tim Hsieh for finding this)

News: Disney to shutter Virtual Magic Kingdom

2008-04-15T07:14:00.002-05:00

Disney has announced that its Virtual Magic Kingdom will close May 21, 2008,... for good. The VMK is no longer accepting new users, either. Disney's VMK was launched in 2005 as a promotional tool, and turned out to be much more. About 15,000 people per day still log in and, chat, play, and explore in the VMK. The news has come as quite a shock to some, and over 10,000 people have even signed a petition asking Disney to keep it open. The shuttering of VMK, and the public response, demonstrate that even though virtual worlds and MMOGs are governed by end-user license agreements (EULAs) or Terms of Service (ToS), players inherently create a vested interest in the game, irrespective of the contractual nature of the player-provider relationship. Players make friends, create bonds, develop groups, and in some sense even come to rely on the virtual world being there the next day. So for those trying to get Disney to keep it open, I wish you luck. And when it comes to the Mouse, you'll need it!

Read More: Article 1 - Article 2

Case: Eros v. Simon (SETTLED 2007) - Second Life

2008-04-07T07:49:00.002-05:00

Somehow this well reported case got overlooked here at the Patent Arcade, and that appears to be because I thought I'd already written about it. In any event, it now gets its own post...

On October 24, 2007, six content owners in Second Life sued Thomas Simon, aka Rase Kenzo, for infringing their copyrights in various online goods. Also included in the complaint were counts for unfair competition and false description of origin, conspiracy, and counterfeiting. The goods included clothing and scripted furniture (aka, sex beds), among other things. After only two months it appears that Mr. Simon saw the light and the plaintiffs proved their point--the case settled in December, 2007, for about $525, and an agreement by Mr. Simon to cease his questionable activities.

At the very least this case is important because it demonstrates the seriousness that many Second Life content creators give to their businesses, treating their intellectual property just as any other business would. The stakes will only get higher as virtual worlds such as Second Life get bigger, and the players have even more money at stake.

Documents:

Complaint-07_10_24_eros_et_al_v_simon_complaint.pdf

Settlement-ecf.nyed.uscourts.gov_cgi-bin_show_temp.pdf

News: IBM to host private Second Life regions

2008-04-02T21:52:00.002-05:00

IBM said today that it would become the first company to host private regions of the virtual world Second Life on its own computer servers.

The project is in testing and will go live within several weeks. This appears to be part of "the Grid," which marks a new focus by Second Life's parent company, Linden Lab, on providing software and services to corporate customers who want to use the virtual world for collaboration and teleconferencing with more assurances of privacy and security than is offered by Linden Labs.

Read more here.

Case: Tafas v. Dudas (USPTO rules)

2008-04-01T13:34:00.003-05:00

Today the U.S. District Court for the Eastern District of Virginia granted Tafas' and Smithkline Beecham's Motions for Summary Judgment, effectively holding that the USPTO's proposed 5/25 and 2+1 rules regarding claims and continuation practice are illegal, and therefore null and void.

Read the opinion here:
GSKSummJudgOPINION.pdf

The case is: Tafas v. Dudas, Docket No. 1:07cv846, as combined with Smithkline Beecham Corporation v. Dudas, Docket No. 1:07cv1008, in the Eastern District of Virginia, before judge Cacheris.

Now we wait to see if there is an appeal...

Visit the Patent Arcade in Second Life

2008-03-30T22:31:00.003-05:00

I now have a presence in Second Life, on the PG (i.e., ok for all ages) region of Pumori. My XboxLIVE gamertage is Aviator, so naturally keeping with the theme my SL avatar is Aviator Kidd. Our Second Life Outpost is lakeside in Pumori. Stop by and say hello.

Second Life URL (SLURL) (if you have Second Life installed, you can click the link to teleport to our outpost)

Here is the SLURL if you want the details: http://slurl.com/secondlife/Pumori/144/111/31

LINKS! LINKS! LINKS!

2008-03-30T22:19:00.005-05:00

I've received a number of requests to link to other web sites. I guess that is a good thing, and means people actually read this blog! I don't have room for all of them on the sidebar, so I have created this post to manage links to other sites. If you want to cross-link, let me know, and I will keep this post updated.

Law Firms:
Banner & Witcoff
Banner & Witcoff in Second Life

Blogroll:
Patently-O
Virtually Blind
Terra Nova

Organizations:
ABA Committee on Computer Gaming & Virtual Worlds

News: Second Life creates Brand Center to protect its trademarks

2008-03-25T09:07:00.002-05:00

As Second Life matures, they are taking some fairly customary steps, one of which is to take a more proactive role to protect their own intellectual property. In this vein, Linden Labs has created the Second Life Brand Center, which details the proper and improper use of Linden Labs trademarks. In addition, Linden Labs has created the "inSL" mark for users to use under certain conditions to signify their presence in Second Life. The Brand Center is online here.

Case Update: MDY v Blizzard - Summary Judgment Motions

2008-03-24T09:39:00.003-05:00

Well it looks like this case has not settled yet, and the parties have filed their summary judgment motions. MDY's Motion can be viewed here. Blizzard's filings are here, here, and here.

Case: Eros v. Leatherwood (Settled, March 2008)

2008-03-15T16:29:00.002-05:00

Eros, the maker of the Second Life sex bed, sued the avatar Volkov Catteneo for illegally copying and selling unlicensed copies of the sex bed, thereby infringement the intellectual property of Eros. After serving subpoenas on PayPal, Linden Labs, Charter Communications and AT&T, Volkov was determined to be Robert Leatherwood. The case, filed in the Middle District of Florida (case 8:07-cv-1158-T-24TGW), was recently settled by the parties. The settlement should be finalized soon, and the terms include a provision that Leatherwood will not do any more copying.

Read more.

Patent: 6,264,560 - USPTO grants re-exam request

2008-03-14T08:48:00.002-05:00

The U.S. Patent and Trademark Office agreed to re-examine online-gaming patent 6,264,560 after the Electronic Frontier Foundation challenged it on the grounds that the technology covered by the patent had been used extensively before it was issued.

The patent is entitled “Method and system of playing games on a network” and allegedly claims all Internet gaming systems that use tournament-style play, display advertisements and have real-time updates of rankings in multiplayer games. Seems pretty broad, except for the fact that it potentially has priority back to December, 1996. The patent issued on July 24, 2001.

Abstract from patent: The present invention is a game playing method and apparatus for automating games such as blackjack, poker, craps, roulette, baccarat and pai gow, wherein players may play continuously and asynchronously, and information related to advertised items can be exchanged between players and advertisers. In one embodiment, each instance of a game is likely unique from all other current game instances. The games do not require a manual dealer and in one embodiment, played in a gaming establishment using low cost gaming stations. The present invention may also be used to play such games on the Internet or an interactive cable television network wherein a game controller communicates with players at network nodes in their homes and at their leisure since there is no game tempo requirement. During a game, advertising is selectively provided by comparing player personal information with a desired demographic profile. Player responses to advertising are used for evaluating advertising effectiveness. The invention is useful for test marketing of products, advertisements, and reduces advertising costs.

Relevant claims:
Claim 1: A method for conducting one or more tournaments, comprising:

identifying players requesting to join one of the tournaments, wherein each tournament includes a plurality of instances of a game for playing by each of the players identified, wherein for each of the players, at least one of the following (a) and (b) must be satisfied for the player to complete one of the tournaments:

(a) a predetermined number of instances of the game must be played by the player;

(b) a predetermined amount of time must elapse between the commencement of the tournament and the termination of the tournament;

for each tournament, the following steps are performed:

(A1) selecting the identified players to be included in the tournament;

(A2) grouping the players into groups, wherein for each group, the players therein compete against one another in playing instances of the game;

(A3) determining one or more winning players for each group;

(A4) establishing a modified version of the game by changing a rule of the game while retaining another rule for the game;

(A5) combining the winning players from different groups into one or more new groups for competing against one another in playing instances of the modified version of the game.

Claim 81: A method of playing a game on the Internet, comprising:

first receiving player identification at a game playing Internet accessible node (GPIAN) for first and second players;

transmitting, via the Internet, from the GPIAN, first information related to communications between: (a) the GPIAN, and (b) a first Internet accessible node from which the first player communicates with the GPIAN;

wherein said first information is utilized in subsequent Internet communications between the GPIAN and the first Internet accessible node;

causing said first information to be stored on the first Internet accessible node so that it is available in subsequent different Internet connections by the first player;

second receiving, via the Internet, at the GPIAN, first responsive information indicative of said first information being present on said first Internet accessible node;

first playing with the first player a first game, wherein one or more game play representations are transmitted to the first player via the first Internet accessible node;

second playing with the second player a second game, wherein one or more game play representations are transmitted to the second player and from the GPIAN while the first player is playing the first game;

playing of a third game between said GPIAN and the second player, wherein a third collection of one or more game play representations is transmitted to the second player, and wherein the transmissions of the game play representations for the third collection and the first collection overlap in time;

wherein said step of second receiving at the GPIAN occurs when the first player has reconnected the first Internet accessible node to the Internet after said first information has been stored on the first Internet accessible node and said first Internet accessible node has disconnected from the Internet.

Claim 87. A method of playing a game on a communications network, comprising:

receiving, at a game playing node of the network, a request for selecting a pace of play of an instance of the game by a first user at a first node of the network;

first transmitting game plays between said game playing node and the first user using network communications between the game playing node and the first node, wherein at least a second user has played an instance of the game; and

transmitting to the first node a ranking of said second user, wherein the ranking is indicative of a proficiency of the second user in playing the game.

Claim 92. A method of playing a game on a communications network, comprising:

receiving at a game playing node on the network, a contact by each of a plurality of users, via a corresponding node on the network for the user, for initiating a corresponding instance of the game between the game playing node and the user's corresponding node, and at least some of said instances overlap in time;

transmitting game plays between said game playing node and a first of the users, for the corresponding instance of the game;

transmitting from the game playing node to the corresponding node of the first user, the ranking of a second of the users, wherein said ranking is indicative of a proficiency of the second user in playing the game, and said ranking is updated to present a change in said ranking while the first user is playing the game.

Claim 94. A method of playing a game on a communications network, comprising:

first receiving, from each of a plurality of users via a corresponding node for the user on the network, a contact at a game playing node on the network, so that each of the users initiates a corresponding instance of the game between the game playing node and the user's corresponding node, and at least some of said instances overlap in time;

second receiving, at the game playing network node from a first of the users via the first user's corresponding network node, a request for selecting a pace of play of the corresponding game instance;

playing, by the first user, the corresponding instance of the game with the game playing node at the pace selected by the first user.

Claim 95. An apparatus for playing a game on a network, comprising:

a display area for electronically displaying an instance of the game to a first user;

an input area for allowing the first user to input a game play;

a communications network connection for communicating, on a network, game related information, between: (a) one or more of said display and said input area, and (b) an addressable node on said network accessible by a network address available to said apparatus;

wherein a plurality of users communicate with said addressable node for playing instances of the game; and

wherein between at least a majority of game plays by the first user, there is a game play related network transmission via said communications connection; and

a game speed of play control for allowing the first user to control the pace of the instance of the game.

Claim 102. An apparatus for playing a game on a network, comprising:

a display area for electronically displaying an instance of the game;

an input area for allowing a first user to input a game play for said instance of the game;

a communications network connection for communicating game related information between said apparatus and a game controller, wherein said game controller communicates with said apparatus via a network, said network also connected to additional network nodes for allowing simultaneous play of instances of the game with the game controller by a plurality of users;

a control for allowing the first user to cancel a previously entered wager;

a card reader, wherein when an identification card identifying the first user is provided thereto, data identifying the first user is communicated to the game controller.

Claim 103. An apparatus for playing a card game electronically, comprising:

a card generator for generating one or more electronic card representations for playing the card game;

a game playing engine for playing a first electronic instance of the card game between a first player and a substantially electronic dealer module, wherein the first player is dealt a first sequence of the card representations, and wherein a second player plays a second instance of the card game with the dealer module so that said first and second card game instances overlap in time, and wherein the second player receives a second sequence of the card representations; and
wherein, for an initial series of one or more plays by said first player using said first sequence, when said second player also initially plays said initial series of one or more identical plays using said second sequence, then for corresponding identical plays by said first and second players, their corresponding hands of card representations are identical.

Claim 104. An apparatus for playing a card game electronically, comprising:

a card generator for generating card representations for playing said card game electronically;

a game playing engine for playing said card game with a plurality of players simultaneously, wherein said game playing engine transmits, for each player, a corresponding collection of one or more of said card representations through a communications network to the player;

a timer in operative communication with said game playing engine for changing a time limit for accepting an input from a first of said players when said first player transmits a communications network request to change a speed of play of said game.

Case: Activision v. Gibson (C.D.Cal.) PENDING

2008-03-12T21:19:00.004-05:00

After receiving a letter accusing them of patent infringement, Activision filed a declaratory judgment action March 12, 2008, against Gibson Guitars, asking the court for finding of invalidity and noninfringement. Gibson is asserting that it has a patent on a musical performance simulation, which Gibson alleges Activision infringes via its popular Guitar Hero games.

The lawsuit was filed in the Central District of California. The patent is U.S. Pat. No. 5,990,405, entitled "System and Method for Generating and Controlling a Simulated Musical Concert Experience," issued Nov. 23, 1999. At a glance, the broadest claim appears to be:

13. A system for simulating participation of a user playing a musical instrument in a pre-recorded musical performance having audio and video portions, the musical instrument producing instrument audio signals at an instrument audio output when the instrument is played, comprising:

a. a source playback device for playback of the audio and video portions of the pre-recorded musical performance through corresponding source audio and source video outputs;

b. a source audio control device for controlling one or more characteristics of the audio portion of the pre-recorded musical performance during playback, the source audio control means operably connected to the source audio output and to the instrument audio output and having a controlled audio output; and

c. the source audio control device is responsive to the instrument audio signals whereby at least one characteristic of the audio portion of the pre-recorded musical performance is controlled by playing of the musical instrument by the user.

We'll keep tracking this case and let you know of any major developments.

Case: Romantics v. Activision (E.D.Mich) - Publicity

2008-02-27T11:22:00.001-05:00

The re-performance of a song for use in a video game pursuant to a non-exclusive synchronization license does not, without more, violate the original artists' right of publicity, even if the artists are referenced, the U.S. District Court for the Eastern District of Michigan held Jan. 22 (Romantics v. Activision Publishing Inc., E.D. Mich., No. 07-14969, 1/22/08).

Activision recorded a new version of the song for use within Guitar Hero. When players encountered the song, it came with the subtitle "as made famous by the Romantics." The Romantics said that this was a violated their right of publicity, was unfair competition under the Lanham Act, and constituted unfair competition. The court disagreed.

Article: Hey, that's MY game!

2008-02-27T09:09:00.002-05:00

Ever wonder what the basic principles are for protecting your video game based on intellectual property law? Steve and I wrote this article, recently published on Gamasutra, that provides a brief introduction to what you need to know to help protect your game and your brand.

Download PDF version.

Case: MGA v Ubisoft (Settled)

2008-02-14T09:21:00.002-05:00

From IP Law360:

MGA Entertainment, makers of the popular Bratz dolls, will hand over $13.2 million to video game company Ubisoft Entertainment, after an arbitrator ruled that Ubisoft had not violated the

Bratz trademark but MGA had violated a contract between the two companies.
Ubisoft had obtained a license from MGA for the right to make video games based on the Bratz franchise in the spring of 2002.

But in 2003, MGA purported to terminate the license under the claim that Ubisoft had failed to release a “substantial number” of the games in Europe, which was one of the provisions in the licensing agreement.

Ubisoft argued that it had not breached the license and continued to make Bratz video games. MGA promptly sued, alleging copyright infringement for producing the Bratz games without a license and breach of contract.

Ubisoft counter-sued for invalid termination of the licensing agreement. The case then went to arbitration.

Last year, the arbitrator decided that Ubisoft had been correct and the termination was wrongful. It awarded Ubisoft the $13.2 million in lost profits, attorneys' fees and interest.

Unsatisfied with the verdict, MGA then challenged the award in a Los Angeles county court. However, that motion was later denied. MGA agreed to pay the award in late-December 2007. The judgment order was entered on Feb. 8.

More more information, read the full article here.

News: Man saves lives playing AMERICA'S ARMY

2008-01-20T16:41:00.000-05:00

Ok, "saves lives" may be a bit of an exaggeration, but what is true is that a North Carolina man assisted passengers from an SUV he saw flip on a highway, using skills he learned playing America's Army. Paxton Galvanek, who pulled people from vehicle after it flipped, said he learned about controlling bleeding from playing section two of the "medic" class training in America's Army, a game developed by the Army as a recruitment tool.

Read more about it at WIRED.

News: MMOGs on the rise

2008-01-03T09:30:00.000-05:00

The trend continues, and MMOGs are getting even more popular. Here are a couple recent articles that you might find of interest:

From WIRED, this article discusses three new MMOGs being released in 2008 that have potential to be huge.

From the NY Times, this article discusses the popularity of MMOGs among kids.

News: Chinese lawsuit over virtual goods

2008-01-03T09:28:00.000-05:00

As reported by Virtually Blind, Shanda, developer of MMORPG The World of Legend, has been ordered to pay 5,000 Yuan (US $679) and apologize to a gamer for taking away his virtual tools, reports Pacific Epoch. The gamer discovered six virtual items worth more than 1,500 Yuan (US $204) missing from his game account on November 22, 2006 (perhaps the Sword of 1,000 Truths), and contacted Shanda regarding the disappearance. Shanda said that the company had taken the items in accordance with a police investigation regarding the sale of stolen virtual items. But Shanda failed to follow police instruction and return the items after the investigation ended.

Read more here.

Case Update: Lonestar v. Nintendo (E.D.Tex.)

2007-12-17T09:02:00.000-05:00

Lonestar Inventions LP v. Nintendo of America Inc., case no. 6:07-cv-00261 in the U.S. District Court for the Eastern District of Texas.

This lawsuit between patent-holding company Lonestar Inventions LP and gaming conglomerate Nintendo Inc. will play out in mediation after a federal judge ordered the two companies to try their case before a mediator on Thursday, Dec, 13, 2007. Texas-based Lonestar first sued Nintendo in June, alleging that the company's popular Wii video game console infringed on a patent titled “High capacitance structure in a semiconductor device.”

Stay tuned...

News: Second Life CTO resigns

2007-12-13T16:27:00.000-05:00

Sorry I've been radio silent for a while. Life has been busy, you know how it goes...

In any event, it appears that Cory Ondrejka, employee No. 4 at San Francisco-based Linden Lab, which owns Second Life, quit Tuesday and will depart at the end of the year. Ondrejka spearheaded the company's decision to allow users to retain intellectual property rights to their creations. That's encouraged a thriving e-commerce market where users spend real dollars to buy virtual real estate, clothes, cars and other items. So it will be interesting to see where the company goes next.

Read more here.

Case: CBC v. Major League Baseball

2007-11-15T10:46:00.000-05:00

C.B.C. Distribution and Marketing, Inc. v. Major League Baseball Advanced Media, L.P., et al.

--- F.3d ---, 2007 WL 2990366, 84 U.S.P.Q.2d 1328 (8th Cir. 2007)

In a much watched case, on October 16, 2007, the United States Court of Appeals for the Eighth Circuit decided C.B.C. Distribution and Marketing, Inc. v. Major League Baseball Advanced Media, L.P., et al., regarding whether it is ok for fantasy sports operators to use professional athletes’ names and historical statistics without a license from the players, the players association and/or the relevant league. In this case, the sport is baseball, but the ruling can be applied across the board to any fantasy sports league. In this case, the Eighth Circuit held that C.B.C. Distribution and Marketing, Inc. (“CBC”), a provider of online fantasy baseball products, could use the names of and statistics of Major League Baseball (“MLB”) players without a license from Major League Baseball Advanced Media, L.P. (“Advanced Media”), a MLB holding company to whom The Major League Baseball Players Association (“the Players Association”) had granted the exclusive right “to use baseball players’ names and performance information ‘for exploitation via all interactive media.’” Slip. Op. at 3. MLB and Advanced Media unsuccessfully argued that CBC’s use of player names and statistics was a violation of the players’ rights of publicity, copyright infringement, and breach of contract, among other theories. The court held that the fantasy sports operator's actions were protected under the First Amendment.

In 1995, the Players Association first granted CBC a license to use the names of MLB players and their corresponding statistics in fantasy baseball games. In 2002, the Players Association granted CBC a renewed license, which gave CBC the rights to use “the names, nicknames, likenesses, signatures, pictures, playing records, and/or biographical data of each player” in connection with CBC’s fantasy baseball products. Slip. Op. at 3. When this renewed license expired in 2005, however, the Players Association did not grant CBC another renewed license. Instead, the Players Association granted the exclusive right “to use baseball players’ names and performance information ‘for exploitation via all interactive media’” to Advanced Media (the MLB holding company mentioned above). Id. After Advanced Media received this exclusive license from the Players Association, it approached CBC and proposed a license under which CBC could promote fantasy baseball games on MLB.com, but could not continue offering its own fantasy baseball products. CBC subsequently brought this declaratory judgment lawsuit, seeking a court decree that it could continue to use the names of and statistics related to MLB players without a license from Advanced Media.

At issue in this case was whether MLB could exercise exclusive control over the fantasy baseball business by limiting others’ access to factual player information (i.e., names and statistics). In order to exercise this control, MLB, acting through the Players Association and Advanced Media, tried to establish that CBC’s use of the names of MLB players and their corresponding statistics violated rights of publicity, was copyright infringement, and was a breach of the previous licensing contract. At the trial court level, MLB argued that CBC was violating the baseball players’ individual rights of publicity, which are protected under state law (Missouri state law in this case, pursuant to federal jurisdictional rules). Although the trial court held that MLB failed to establish these state-law rights, the Eighth Circuit reversed this determination and found that state-law rights of publicity were implicated. However, the Eighth Circuit further held that First Amendment considerations (i.e., the “right to use information that is available to everyone”) trumped these state-law rights. Significantly, in deciding that these state-law rights “must give way” to First Amendment considerations, the Eighth Circuit characterized the baseball players’ names and their corresponding statistics as information that is “readily available in the public domain.” Slip. Op. at 7. Because MLB (or anyone else for that matter) cannot exercise exclusive control over information in the public domain, the Eighth Circuit affirmed the trial court’s judgment in favor of CBC, thus allowing CBC to continue using MLB players’ names and statistics without a license.

(Earlier in the case, MLB and Advanced Media also tried to argue that the use of player names and statistics was an infringement of one or more copyrights owned by MLB. MLB argued that it owned a copyright in the compilation of names and statistics. The court didn’t buy it and indicated that the names and statistics were public domain factual information.)

So for those of you running your own fantasy sports sites (or at least fantasy baseball sites), the decision in this case means that you can make use of the same information as CBC (i.e., player names and statistics) without obtaining a license from the relevant professional sports league. However, you should still consult a lawyer regarding your particular situation, because the ruling in this case involves some complicated interactions between state and federal law, and perhaps could have been decided differently by a different court with respect to the rights of publicity issues.

Case: MicroUnity v. SCEA Settles

2007-11-06T08:02:00.001-05:00

Word on the street is that MicroUnity and Sony Computer Entertainment America have settled their ongoing patent dispute regarding Sony's PlayStation products. The two companies have asked for a 30-day stay of all deadlines in the pending litigation in the Eastern District of Texas so they can put the finishing touches on their settlement agreement. MicroUnity first filed the lawsuit against Sony in November 2005, accusing the Japanese company of infringing 10 patents with its Sony Playstation 2, Playstation 3 and Playstation Portable game consoles. The patents cover various semiconductor integrated circuits and system processes that MicroUnity claimed were used to make the various Sony products.

Read more here.

News: Second Life IP theft lawsuit

2007-11-01T10:32:00.000-05:00

More Second Life news: As reported in the New York Post, a half-dozen entrepreneurs are suing a Queens man, charging him with counterfeiting and selling versions of their products. Here's the catch: The products aren't real, and the alleged crimes took place in the virtual world of Second Life on the Web.

Read full story here.

We'll keep monitoring this case and let you know as we learn more.

News: Change in Second Life ownership policy???

2007-10-29T16:11:00.000-05:00

As originally reported on Terra Nova, Linden Labs appears to have made a potentially significant change to the wording on its home page. The home page used to read:

“Second Life is a 3D online digital world imagined, created and owned by its residents”

But now it reads:

“Second Life is a 3D online digital world imagined and created by its residents”

The post on Terra Nova has an interesting string of comments. Check it out. It will be interesting to see if anything comes of this.