From Law360:

An entertainment licensing company has begun legal combat with bankrupt video game producer Midway Games Inc. over the licenses for movies, television shows, live action productions and other properties based on the blockbuster game "Mortal Kombat."

Threshold Entertainment Inc. filed an adversary complaint Wednesday in the U.S. Bankruptcy Court for the District of Delaware challenging Midway's proposed $33 million sale of substantially all of its assets, including all previously released titles and games based on the hit Mortal Kombat series, to Warner Bros. Entertainment Inc. That deal was announced in late May.

Threshold claims that it holds perpetual exclusive rights to develop derivative works in film and television based on Mortal Kombat as well as rights to licenses on certain characters that appear in both the video games and the films and TV series based on them.

Its a peripheral issue, so I doubt we'll track it closely, but will let you know if anything significant comes of it...

Here's the complaint.
Blizzard Entertainment, Inc. v. In Game Dollar, LLC
United States District Court for C.D. Cal.
Case No. SACV07-0589-JVS, Filed May 22, 2007, Settled January 28, 2008

On May 22, 2007, Blizzard Entertainment, the creator and operator of the popular MMORPG World of Warcraft, brought suit against In Game Dollar (IGD). IGD was the parent company of which offered power-leveling and virtual gold-selling services. Power-leveling allows a player to pay to have his virtual character advanced to the agreed-upon level by a third party using the player's account. Virtual gold sales consist of a player paying real-world money then having his virtual character meet the merchant’s character in-game to transfer the virtual gold. IGD advertised its services in the game by constantly sending spam messages to players though WoW’s chat system.

Blizzard alleged that IGD’s services and aggressive in-game marketing via chat spam diminished players' game experience and cost Blizzard subscribers, bandwidth, employee time, and revenue. Blizzard further stated that IGD’s actions violated Blizzard’s End User License Agreement and Terms of Use. The lawsuit was brought on six grounds:
  1. Violation of the Computer Fraud & Abuse Act

  2. Violation of the California Computer Data Access & Fraud Act

  3. Intentional Interference with Contract

  4. Trespass to Chattels

  5. Unjust Enrichment

  6. Unfair Competition

IGD decided to avoid prolonged litigation and essentially agreed to shut down its business in exchange for Blizzard not seeking monetary damages. The case was settled on January 28, 2008 with the court issuing a Consent Order. The order consisted of a permanent injunction preventing IGD from engaging in any future WoW virtual asset sales or in-game marketing communications.

The blog Virtually Blind provided an analysis of the case and found that Blizzard “has taken what is arguably the most aggressive legal stance in the industry against gold farmers, chat spammers, third-party bot providers, and others who violate World of Warcraft’s Terms of Use and End User License Agreement. The company’s actions have been widely praised both by players and by commentators who follow legal issues in games and virtual worlds.” Virtually Blind saw the settlement as further recognition of virtual property by the court system.

Because this was a settlement rather than a court decision on the merits, the result doesn’t serve as binding precedent. Still, the result of forcing a gold spammer to cease operations within a game has acted as a major milestone.

Read the full Complaint here.

Read the full Consent Order here.
Sitrick v. DreamWorks, LLC et al.
516 F.3d 993 (Fed. Cir. 2008)

This case, decided February 1, 2008, emphasizes the importance of enablement in determining the validity of patent claims, specifically when a patent owner is advocating a broad claim construction.

At issue were two patents, U.S. Patent Nos. 5,553,864 (the ’864 patent) and 6,425,825 (the ’825 patent), owned by David Sitrick, an individual inventor. These patents claimed the process of integrating user-generated audio and video into pre-existing video games and movies, so the user could incorporate his voice and image into the medium.

The basic premise of the invention is that a controller, called an Intercept Adapter Integration System (IAIS), would “intercept address signals coming from the video game apparatus and going to the game card or storage card. If address signals correspond to the character functions that are to be replaced with a user image, the IAIS reconfigures the signals so that when the signal gets to the game card or storage card, the user image is substituted for the predefined character image.” Sitrick v. DreamWorks, 516 F.3d 993 (Fed. Cir. 2008). For example, the process of intercepting the signal for a video game character and substituting it with the user-made voice and image could be used to create a personalized character.

Sitrick brought this patent infringement suit against DreamWorks and other DVD producers and distributors for their use of the allegedly infringing product ReVoice Studio which allows users to integrate their own voices into pre-existing video images on the DVD. The District Court for the Central District of California granted summary judgment of non-infringement for the defendants after finding the asserted claims to be indefinite and invalid for lack of enablement as to movies. The issue on appeal was whether the asserted claims were fully enabled as required by 35 U.S.C. 112 ¶ 1. The Federal Circuit affirmed the District Court’s ruling, agreeing that the claims were not enabled.

The first key decision the court made was regarding claim construction. The defendants urged the district court to adopt the narrow construction that the patent claims only covered video games (and therefore, their use of ReVoice with movies alone would not be infringement). Instead, the court construed the claims broadly, as Sitrick requested, covering both video games and movies. After determining that the claims included movies, the court engaged in an enablement analysis.

According to the enablement requirement of 35 U.S.C. 112 ¶ 1, a patent’s specifications must contain “a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same.” This requirement is met if the skilled person can read the patent specifications and then use the invention without “undue experimentation.” Sitrick, 516 F.3d at 999 (quoting AK Steel Corp. v. Sollac, 344 F.3d 1234, 1244 (Fed. Cir. 2003)). The full scope of the claimed invention must be enabled. Id. (citing Auto. Techs. Int’l, Inc. v. BMW of N. Am., Inc., 501 F.3d 1274, 1285 (Fed. Cir. 2007)).

Therefore, a patent owner who chooses broad claim language must make sure the expansive claims are fully enabled. Courts don’t want patent owners to be able to claim protection for more than what they clearly designed/invented, so courts won’t be sympathetic to a patentee who fails to enable a patent when he could have just claimed the invention more narrowly. Here, because the broad patent claims covered video games and movies, the patent specifications needed to fully describe how the invention would work for movies as well as video games.

The patent specifications mentioned how the patent would be applied to movies, but the defendants’ experts showed they weren’t clear enough so that a person trained in the art would be able to replicate the patent process of substituting or integrating user images for pre-existing characters in a movie “without undue experimentation” – likely because it would be so hard to do. The IAIS/invention intercepts signals regarding the pre-existing medium and substitutes the user-generated audio and/or visual images. This works well for substituting personalized characters in video games because the characters are separately controlled functions from the rest of the game. As the district court recognized, “[m]ovies do not have easily separable character functions, as video games do” and movie characters cannot be selected and analyzed, so it would be hard to intercept a specific signal and replace it with the user-created image. Sitrick, 516 F.3d at 1000. Movie characters are inseparable from the surrounding images. The defendants’ experts effectively showed that the techniques that would be used for intercepting & substituting characters in a videogame would be of no use for doing the same in a movie.

Sitrick’s expert did not create a genuine issue of material fact (which would defeat summary judgment for the defendants) because he equivocated on whether the integration and substitution could be done in movies, and he admitted that he was not an expert in movie-making. Enablement has to be judged by someone skilled in the art.

The Federal Circuit swept aside Sitrick’s argument that the court didn’t fully consider the patents’ explanations/teachings with respect to video games by saying that the patents’ clear specifications for enabling videogames were irrelevant; the enablement requirement was not met unless the patents were enabled for both embodiments of the claim – videogames and movies.

A second point in controversy between the parties concerned the claim construction for Sitrick’s voice synthesizer process of the ‘864 patent and the meaning of “model” as it was used in claim 54: “the user voice parameter data is input as a model to a voice synthesizer.” The court required that the synthesized voice produce an entirely synthetic voice saying new words, not simply a playback of the user’s sample. The court found that given its claim construction, the ’864 patent failed to enable modeling a voice for reproduction by a voice synthesizer.

Overall, the court held that the defendants met their burden of proving by clear and convincing evidence that one skilled in the art wouldn’t be able to replicate the processes in the specifications without undue experimentation. Therefore, the patents were not fully enabled with respect to the full scope of the asserted claims, and the patents were therefore invalid.

So what does this case mean for future patent validity cases? The IP Law Blog suggests that, while obviousness based on prior art is used more often, lack of enablement may be becoming a stronger tool for invalidating patents. It further notes that “[s]ome commentators have questioned whether the Federal Circuit is setting the enablement standard too high.” Unfair standard or not, the consensus seems to be that complete enablement and accurate claim construction are crucial to winning a patent validity contest. If you’re seeking broad claims (during prosecution) or requesting a broad claim construction (in litigation), you darn well better make sure you’ve got the entire scope of your claims enabled in your specification, precisely and in detail. However, it's a bit of a double edged sword: one the one hand you have narrow claims that are hard to read on alleged infringers; on the other hand you have broad claims susceptible to an invalidity attack based on lack of enablement of the full scope of the claims.

For further information and analysis on this case, see commentary at Patently-O Blog and The IP Law Blog.

Read the full opinion here.

Fenner Investments, Ltd. v. Microsoft et al.
United States District Court for E.D. Tex.
Filed 1/5/07, Decided 3/16/09 (Opinion issued 6/3/09)


This case revolved around Fenner Investment’s U.S. Patent No. 6,297,751, which describes a low-voltage joystick port interface.

Prior art joysticks used resistor-like devices called potentiometers to produce analog signals. These analog signals had to be transformed into digital signals to be read by a computer. An interface circuit interpreted the joystick’s analog signal to produce a responsive digital pulse which had a pulse width that corresponded to the joystick position. The computer would measure the width of the digital pulse to figure out the position.

Newly developed computer and video game systems require lower voltage (prior art joysticks and computers were electronically compatible, both operating at 5 volts), so they didn’t work with the interface circuits/joysticks anymore. Fenner’s patent solved that problem by creating an interface circuit that allowed the old, higher voltage joysticks to be used with the newer, lower voltage systems.

The “Pulse Width” Limitation
Fenner’s patent contains a limitation that requires an infringing product to produce ‘a single cycle of variation in the logical level of a signal, a width of the single cycle of variation, assessed in time or distance, represents a coordinate position of said joystick device.”

Fenner alleged that Microsoft’s Xbox controller and Nintendo’s Wii and GameCube controllers infringed on its patent. These controllers contain thumbsticks that operate by initial analog signals being translated into 8- or 10-bit digital signals (or “words”) that get sent to the console processor which interprets the digital word to calculate the corresponding thumbstick position.

Basically, Fenner’s invention works so that analog signals are represented by the width of a variation (pulse) in a digital signal, whereas defendants’ products require the full 8- or 10-bit digital word (made up of 1’s and 0’s) to give the joystick position. As an example of a digital word, “01100000” shows a two cycle “pulse” occurring toward the beginning of the 8-bit word.

Fenner argued that the defendants infringed simply because the accused products create a pulse with a width that can be measured and, based on the pulses, a joystick position can be determined. The defendants argued that the pulse widths alone are irrelevant and instead the entire digital word is necessary to determine the joystick position.

Claim Construction
The main issue here turned on the claim construction of the pulse width “representing” joystick position and whether that meant providing some information about the position (Fenner’s argument) or providing all information necessary to determine the position (Defendants’ argument). Relying on intrinsic evidence (i.e., the patent claims, specification, and its prosecution history before the United States Patent & Trademark Office), the court found that the claim required that the pulse must communicate all the necessary information to determine the specific joystick coordinate position.

Fenner also argued that “represent” meant that pulse width could be combined with other data, such as the position of the pulse in the 8- or 10-bit word, to indicate joystick position. The court rejected this argument based on the prosecution history and claim amendment language which indicated that only pulse width, not other data, was to be used to determine joystick position.

Summary Judgment – Direct Infringement
Using the above claim construction, the court found summary judgment appropriate because there was no genuine issue of material fact. Because Fenner’s patent relied on a pulse width alone to relate the joystick position, the defendants had not infringed on the patent. This is because, in the accused devices, the pulse widths alone are meaningless and say nothing about joystick position. The pulse widths simply describe the bits. It’s the 8 or 10 bits, read together, that actually give the position. A signal representing the series of two, three, or more “1's” in a row does express “a single variation of the logical level of a signal,” but it doesn’t give any position information without the accompanying “0's” that also make up the digital word.

Summary Judgment – Doctrine of Equivalents
Generally, patent protection is limited to what’s written in the patent claims. However, to ensure fair protection of patents, the doctrine of equivalents states that a patent may be protected even when another product or process does not literally infringe on the patent, as long as the infringing product or process is deemed to be equivalent. The doctrine of equivalents was formed so that copycats could not avoid patent infringement simply by making minor or trivial variations to the claims. For the doctrine to apply, the accused product must perform “substantially the same function in substantially the same way with substantially the same result” (referred to as the function-way-result, or FWR, test).

Fenner argued that the doctrine applied because the production of binary encoded numbers was equivalent to the production of pulse widths for determining joystick position. The court determined that Fenner’s interpretation wrongly wrote the “pulse limitation” out of the claim and disregarded the “way” part of the test by being so broad that it would include any digital signal no matter what “way” that it communicated position. The court further found that Fenner failed to show equivalence in the “way” the devices operate because in Fenner’s device, only the pulses, or “cycles of variation,” are used to determine joystick position whereas in the defendants’ devices the periods of no variation are just as necessary as the periods of variation (for creating an 8- or 10-bit digital word) to determine position.

The “Lower Source Voltage” Limitation
The court also faced a second issue of claim construction concerning the definition of the device parts, because certain parts of the accused products had to operate at a lower voltage in order to be infringing.

Claims 1, 9, and 14 of the ‘751 patent call for “[a]n interface between a joystick device having a first source voltage and a processor, comprising . . . an interface circuit having a second source voltage that is lower than the first source voltage. . .” The Court’s claim construction defined “interface circuit” as “a circuit that connects the joystick and the processor.”

The ‘751 patent claims required the interface circuit between the joystick and processor to operate at a lower voltage than the joystick. In the defendants’ accused products, only the processor core, or central processing unit (CPU), operates at a lower voltage than the joystick. Fenner argued that the periphery of the processor could be included in the interface circuit, while the defendants argued that the processor included the CPU and its peripherals, both separate from the interface circuit. The claim construction then turned on whether “processor” meant the entire processor chip or just the processor core. Using extrinsic definitions as well as the context of the claim, the court held that “processor” should be defined as “the CPU along with its peripheral circuitry.” Fenner had agreed that such a definition would preclude any issues of triable fact, so summary judgment was appropriate.

Read the full opinion here.

So we've noticed some buzz on the Internet lately about the backdrop to Conan O'Brien's Tonight Show set. The guys at Serious Lunch posted the backdrop, and what appears to be a doctored version of the backdrop, adding in various elements from the Mushroom Kingdom from Mario Bros. An animated GIF with the two images can be seen here.

Folks are speculating about the similarities, so we thought we'd take this opportunity to discuss what kinds of copyright issues might be present here. And because the issues are different, we'll treat two possible "defendants" - 1) Conan and 2) the folks who created the doctored version of Conan's backdrop.

In order to prove copyright infringement, a plaintiff must demonstrate two basic elements: 1) ownership of a valid copyright, and 2) copying of protected expression.

The first element, ownership of a valid copyright, is usually an easy element to prove. Copyright protection exists from the moment that an author fixes a work in a tangible medium of expression. So the moment an artist puts brush to canvas, or when a writer puts pen to paper (or hits the "save" button), a copyright exists. The result is the same when the "author" is a computer game artist. At some point the artist drew the Mario images, either on paper or on a computer, both of which are tangible media of express, and both of which would result in a copyright for those images. There might still be some issues of whether the artist that drew those images came up with the original concept himself or herself, as opposed to copying it from yet some other source, but let's assume the design is original to the author. The author worked for Nintendo (another assumption), and so Nintendo owns the copyright because that was created by an employee in the ordinary course of employment and is therefore a work made for hire under U.S. copyright laws (we're also assuming U.S. law applies, because we're not Japanese legal experts :)).

The second element, copying of protected expression, is a little more difficult to prove. Copying is proven by either direct proof of copying (e.g., offering testimony from someone who actually saw the alleged copier copy the protected work - this hardly ever happens), or with indirect proof of copying (which is more common) by demonstrating 1) access to the protected work + 2) substantial similarity between the copied work and the alleged infringing work. Access can even be inferred when the two works are strikingly similar such that no reasonable person would conclude they could be that similar absent some level of copying.

Access can be proven either by direct evidence, i.e., the alleged infringer admits that he or she had access to or otherwise reviewed the copyrighted work, or by circumstantial evidence, e.g., through widespread dissemination of the copyrighted work to the public. Nintendo has certainly sold its fair share of Mario games. Indeed, one web site estimates that Mario games have sold over 160 million copies starting with Super Mario Bros. on the Nintendo Entertainment System (NES). Widespread dissemination appears to be present. However, how many of those copies included the stuff in the images above? We're guessing the answer is still in the millions.

Ok, assuming there is access to Nintendo's stuff by both Conan (or his designers) and the folks who created the doctored image, is there also substantial similarity? What amounts to substantial similarity? Different courts have used different tests, but it boils down to a determination of whether there is a remarkable resemblance between the original and allegedly copied works. Here the analysis is a bit different between Conan and the doctorer. Does the Conan backdrop, without the stuff added in the doctored image, look like any Mario game screen or image? How about the version created by the doctorers?

Even if there is access + substantial similarly, designers over at NBC, or the creators of the doctored version, might still have some defenses they can rely on. First, independent creation is a complete defense to copyright infringement. If the designers or doctorers can prove that the similarities between their respective images and Mario's stuff are simply coincidence, then there is no infringement no matter how similar the two works are.

In addition, they might be able to demonstrate that their use is a fair use of the copyrighted work. A fair use of a copyrighted work is not infringement. Fair use includes "such use by reproduction in copies or phonorecords..., for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research." 17 U.S.C. sec. 107. Other uses might also be fair uses of the copyright work, based on an analysis of the following four factors:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes. NBC is a commercial entity whose primary purposes is to air entertaining television shows that draw an audience, allowing them to sell commercials to advertisers for financial gain. The Tonight Show, however, does have a news component to it, insofar as it discusses current events, interviews notable figures, etc. The folks who created the doctored image appear to have done it simply to make an editorial point.

(2) the nature of the copyrighted work. This factor is analyzed based on whether a copyrighted work is creative versus factual. Art, fiction, and sculpture are purely creative, and therefore receive stronger copyright protection than factual works such as compilations of historical facts, news articles merely providing factual content, and nonfiction books. The elements of Mario's games are artwork, and appear to be a creative work deserving strong copyright protection.
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole. This factor raises an interesting question: What is the copyrighted work that was allegedly copied? In the Conan backdrop, is there even any Mario game screen having an outline that looks like that backdrop? In the doctored image, if the individual elements were copied (e.g., the Oompa Loompa mushroom by itself) from a Nintendo work, then how much of that work was just the Oompa Loompa?
Some courts also look at what components the U.S. Copyright Office included within the registration certificate. We have no knowledge of whether Nintendo has registered its copyright in the elements of the Mushroom Kingdom or not, but Nintendo could register the copyright in the individual screenshots and elements (e.g., the Oompa Loompa mushroom) making up the panels allegedly copied for Conan's backdrop.
(4) the effect of the use upon the potential market for or value of the copyrighted work. This factor is often given more weight than the orthers, sort of under the theory "no harm, no foul" (that's not legalese; just an analogy). We doubt that Nintendo was making much business off of licensing its works for set backdrops, but you never know. Courts also look to potential markets for copyrighted works, so if there is a possible market in this area, that could be taken into account.

Another possible defense is to argue that the works are not substantially similar at all, but rather Conan's backdrop and/or the doctored image are so transformative from the original inspiration that they can only be said to contain a similar "idea" but that the "expression" is different. This is known as the idea/expression dichotomy of copyright law. Copyright does not protect ideas; copyright only protects the actual expression of an idea.
And as a final note, the U.S. Copyright laws include a separate provision for infringement by "derivative" works. A classic example of a derivative work would be when an artist cuts up a bunch of copyrighted images and makes a new collage out of it. The doctorers here may have arguably created a derivative work, if they copied snippets from various Mario games.

What do we think? Well, being that we are attorneys, and that we don't have all the facts, we will keep our opinions to ourselves. You never know what facts will come to light when two parties get in a dispute, and the game can change in an instant when there is a new development. Could it be a parody and therefore protected by the First Amendment? Could it be independent creation? Could it be de minimus copying? Could it be fair use? It could be any of the above given the right facts. Heck, this could be one giant publicity stunt: NBC or the doctorers might already have a license from Nintendo, and this could all be for the sake generating publicity when the cult of gaming elite inevitably notices the similarity.
Zynga Game Network, Inc. v. John Does 1-5
United States District Court for N.D. Cal.
Case No.: 3:09-cv-02441-CRB, Filed 6/2/09

Zynga Game Network, whose settlement with CLZ Concepts we just commented on, hasn’t wasted any time in jumping into another lawsuit. On June 2, 2009, Zynga brought a trademark infringement suit against John Does 1-5. We are obtaining the complaint and will update this post once we've had a chance to review it. We’ll keep you updated as we get more information.
Fenner Investments Ltd. v. Microsoft et al.
United States District Court for E.D. Tex.
Filed 1/5/07

As you may recall this case consisted of a claim by Fenner that defendants had infringed on its U.S. Patent No. 6,297,751 for a low voltage joystick port interface. Basically, the patented technology was a way to hook up old joysticks to new computers (see’s brief synopsis of the case). On 3/16/09, the day before the jury trial was to begin, the court entered an order granting summary judgment to defendants Microsoft and Nintendo (Sony, an original named defendant, was dropped from the suit 2/26/07), finding no patent infringement. For more information regarding the case conclusion, click here. The court issued its full opinion and final order of summary judgment on 6/3/09. Further analysis of the opinion is forthcoming once we obtain and review the final order.
Zynga Game Network had filed suit on February 27, 2009 against CLZ Concepts, Jeff Chen and James Zhang asserting copyright infringement. Yesterday a settlement conference was held, and the parties appear to have settled out of court. So it looks like no new case law will come from this one, and we will no longer be tracking this case.

Zynga is a major social gaming developer and now leads the industry as the largest application developer on Facebook with hits like Mafia Wars and Texas HoldEm Poker. Zynga also produces its apps for other social platforms such as MySpace and the iPhone. CLZ Concepts is a smaller social apps developer, acquired by Zynga in early 2008.

Article One Partners is a company that offers rewards to people for finding prior art that can be used to try to invalidate patents, and Article One is willing to pay serious money to those who find that prior art. Most recently, Article One Partners paid out $50,000 to an anonymous individual for identifying prior art that, Article One Partners believes, invalidates at least one of the two patents. The Article One Partners press release indicates that they believe the prior art they found invalidates's earlier '690 patent. They do NOT indicate that they believe it also invalidates the latter '558 patent, but instead indicate that the prior art may also be "relevant" to the latter patent. Indeed, it may be "relevant", but only one claim needs to remain valid and infringed for NCSoft to be on the hook for damages and an injunction. Nonetheless, Article One clearly believes they have some good prior art, and is willing to license its findings to interested parties.

While this certainly appears to be good news for the virtual world community in general, NCSoft is not out of the woods yet. If anything, this might help distill the issues in the case and reduce the number of claims being litigated between the parties, but it doesn't appear that the case is going to go away any time soon. Stay tuned...
Yahoo! Inc. v. Nat'l Football League Players Association, Inc. et al.
United States District Court for D. Minn.
Case No.: 0:09-cv-01272-PJS-FLN, Filed June 1, 2009

Continuing the trend of fantasy sports litigation, Yahoo! Inc., has filed a lawsuit seeking declaratory judgment against the defendants National Football League Players Association, Inc., and the National Football League Players Incorporated (collectively hereinafter “NFL Players”).

The NFL Players Association acts as the exclusive collective bargaining representative for active players in the NFL. The players assign their rights to the Association which, in turn, grants NFL Players Inc. exclusive use of the Group Licensing Rights. Yahoo! provides NFL fantasy football game services to participants throughout the United States. This includes tracking, compiling and posting publicly available NFL player statistics and information to aid game participants in making decisions.

Prior to the upcoming 2009/2010 season, Yahoo! had a licensing agreement with NFL Players to pay for using the statistics as well as “names, likenesses (including, without limitation, numbers), pictures, photographs, voices, facsimile signatures and/or biographical information” of NFL players. However, the license expired in March 2009 and was not renewed. On April 28, 2009 the same court hearing this case decided in CBS Interactive, Inc. v. Nat. Football League Players Inc., 70:08-cv-0597-ADM-SRN (D. Minn.), that the provider of a fantasy football game did not require a license from NFL Players to use player names, statistics, and other information in operation of the game. After that decision, Yahoo! contacted NFL Players to get confirmation that it would not be sued for similarly using the statistics but NFL Players refused to provide confirmation since they were appealing the court's ruling.

Yahoo! followed up on June 1, 2009 by filing the present suit in which it seeks declaratory judgment (a declaratory judgment action is one filed by someone who fears getting sued by another on an issue, and doesn't want to sit around waiting to get sued - they file a suit of their own to clear the air and resolve the issue) on three claims:

  1. Yahoo!’s actions in operating its fantasy football league did not violate any publicity rights owned or controlled by NFL players;

  2. If Yahoo!’s actions did violate those rights, the First Amendment supersedes that right of publicity; and

  3. If Yahoo!’s actions did violate those rights, federal copyright law preempts the trademark right or right of publicity by dedicating information used in a fantasy sports games business to the public.

This suit seems almost identical to CBS Interactive mentioned above, as well as C.B.C. Distribution and Marketing Inc. v. Major League Baseball Advanced Media, L.P., 505 F.3d 818 (8th Cir. 2007), which dealt with similar publicity issues in fantasy baseball. In both of these other declaratory judgments, the courts found that even if the plaintiff did violate defendants' publicity rights, the plaintiff enjoyed a First Amendment right to use the publicly available players' names and statistics that prevailed over any right of publicity. To escape this precedent set in the 8th Circuit, it seems possible that NFL Players may attempt to transfer venue to the Southern District of Florida as the defendants attempted in CBS Interactive (to no avail). Why Florida? In, Inc. v. Nat'l Football League, Player's Ass'n, Inc., 106 F. Supp. 2d 1309, 1315 (S.D. Fla. 2000), which appears to be the only other case addressing publicity rights and the First Amendment as they relate to the fantasy sports industry, the court rejected the plaintiff's argument that a fantasy football provider had a First Amendment right to use players' names and statistics without a license. This kind of split among jurisdictions may result in a trip to the Supreme Court, so we'll keep an eye out ...

A full version of the complaint can be found here.

IQ Biometrix, Inc. v. Perfect World Entertainment, Inc. et al.
United States District Court for N.D. Illinois, Eastern Division
Case No.: 1:09-cv-03180, Filed May 27, 2009

IQ Biometrix, Inc. on May 27, 2009, filed a new lawsuit against Perfect World Entertainment, Inc., Perfect World Co, Ltd., and Wagware Systems, Inc. for alleged patent infringement regarding two separate patents.

The plaintiff, IQ Biometrix, Inc., provides facial image composite software, marketed under the name FACES, which is used by law enforcement agencies worldwide, including the CIA, the FBI and the U.S. Military.

Defendant Perfect World Co. Ltd. is a China-based online game company and maker of the popular fantasy-based MMORPG Perfect World which offers gamers significant avatar customization and player-created content. Defendant Perfect World Entertainment is a wholly-owned subsidiary of Perfect World Co. Ltd., established in the U.S. in 2008 to localize and publish Perfect World in North America. More info on defendants here and here.

Defendant Wagware focuses primarily on developing software applications for handheld platforms. One of its products, MakeFaces, is a children’s game designed to allow the user to combine different styles of facial features (e.g., eyes, nose, hair) to make funny faces.

IQ Biometrix alleges that Perfect World Entertainment and Perfect World Co. infringe IQ Biometrix’s patent 6,731,302 by providing the online game Perfect World, likely because of the avatar customization the game provides. The ‘302 patent, titled Method and Apparatus for Creating Facial Images, is for a process of creating a facial composites by selecting “basic morphological elements” or facial features from a library of encoded features and merging them into a single synthetic image with proportional components, thus reducing contrasts between the individually selected features. The invention appears applicable to systems used in law enforcement, artistic creations, education, and recreation (such as creating personalized characters in gaming).

Representative Claims 6 & 16 of the '302 patent read as follows:
6. A method for generating a composite facial image, said method comprising the steps of:
a) providing a machine-readable storage medium for storing graphical representations of basic morphological elements, said graphical representations being proportionate to one another and having respective boundaries, the graphical representations of basic morphological elements including skin components around their respective boundaries, the skin components having skin tones substantially similar to one another;
b) receiving user data indicative of a set of data elements, each data element in said set of data elements being associated to a respective graphical representation of a basic morphological element in the machine-readable storage medium;
c) processing the set of data elements to locate in the machine-readable storage medium corresponding graphical representations of basic morphological elements;
d) combining the graphical representations of basic morphological elements located to generate a digital representation of a facial image, at least two graphical representations being combined such that their skin components having substantially similar skin tones meet at a boundary; and
e) displaying the digital representation of the facial image on display means.

16. A method for generating an electronic library of basic morphological elements suitable for usage in a composite picture system, said method comprising the steps of:
a) providing a plurality of facial images;
b) digitizing the facial images;
c) processing the digitized facial images to create a plurality of graphical representations of basic morphological elements of a certain facial image, said graphical representations of basic morphological elements including skin components having different skin tones;
d) applying a filtering process to said graphical representations of basic morphological elements to derive modified graphical representations, the modified graphical representations including skin components having skin tones substantially similar to one another;
e) processing said modified graphical representations to generate calibrated graphical representations, said calibrated graphical representations being substantially proportional to one another; and
f) storing the calibrated graphical representations on a computer-readable storage medium.
IQ Biometrix has also alleged that Perfect World Entertainment and Wagware (through Perfect World and MakeFaces computer games, respectively) infringe on its patent 7,289,647, titled System and Method for Creating and Displaying a Composite Facial Image. The ‘647 patent consists of 44 claims directed to various processes for the encoding/decoding of images that can be separated into their constituent parts (i.e., individual facial features) as may be used in composite picture systems. This type of encoding of the images allows for reducing the memory requirements for storage and the bandwidth required for the transmission of the image (by storing and transmitting a facial code rather than a graphical representation).

Representative Claims 1 & 34 read as follows:
1. A method, comprising:
receiving a number of facial feature designations;
generating element codes corresponding to the facial feature designations, each element code based on:
(a) a symbol representative of a facial feature, the symbol having one of a plurality of values indicative of variations of the facial feature, and
(b) a first code factor having a value that equals or exceeds a maximum value of the plurality of values indicative of the variations of the facial feature; and
displaying a composite image based on the element codes corresponding to the facial feature designations.

34. A system, comprising:
a screen; and
a processor for controlling the screen to display a number of facial feature images on a first area of a screen and to display a composite facial image on a second area of the screen, said composite image including facial feature images selected from the first screen area, the processor automatically generating element codes corresponding to the selected facial feature images, each element code based on:
(a) a symbol representative of a facial feature, the symbol having one of a plurality of values indicative of variations of the facial feature, and
(b) a first code factor having a value that equals or exceeds a maximum value of the plurality of values indicative of the variations of the facial feature, the composite image based on element codes corresponding to the selected facial feature images.
IQ Biometrix has requested a jury trial and seeks injunctive relief and damages.

We've added this case to our tracking list and will provide updates of major developments. The full text of the complaint with accompanying patents can be downloaded here.

Today the United States Supreme Court granted certiorari in the case Bilski v. Doll. As many readers may know, the case In re Bilski is the case in which the Federal Circuit court of appeals held that business methods are not patentable unless: 1) they transform matter into a different state or thing, or 2) they are tied to particular machine. This will be the first time the U.S. Supreme Court has addressed statutory subject matter under 35 U.S.C. sec. 101 since the 1981 case of Diamond v. Diehr where the Court held that the execution of a physical process, controlled in part by the running a computer program, was patentable.

It will take some time for the case to go through the briefing stage, and then to schedule oral arguments, before the Court will render a decision. In view of the fact that the Court is about to recess for the summer, we probably won't get a decision on this case until late 2009 or early 2010. We'll keep you posted nonetheless, as this case could have a major impact on patents for video games and other interactive entertainment and media.

Read more from Brad Wright of Banner & Witcoff here.
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