Hasbro, Inc. v. Infogrames Entertainment SA

United States District Court, District of Rhode Island

Case No. 09-cv-00610, Filed December 16, 2009

Case Update 05/24/2012:

In August of 2011, Hasbro and Atari released that they had reached a settlement regarding the intellectual property rights in Dungeons & Dragons.  Hasbro has reacquired digital licensing rights to the franchise while licensing these rights to Atari.

Case Update:

This case is still making its way through the court system. On June 28, 2011, Atari's motion to have the case dismissed was denied. In it's motion Atari argued that Hasbro could not prove its fraud claims since it did not actually or justifiably rely on statements from Atari regarding licensing of D&D to third parties. Atari's motion also accused Hasbro of "attempting to manufacture a non-existent [fraud] claim out of thin air." The court was apparently not convinced by this argument as it has allowed the case to continue.

Original Post:

Earlier this week, Hasbro, which owns the intellectual property rights in Dungeons & Dragons, filed a lawsuit against Atari over Atari’s allegedly unauthorized sublicensing of its rights in Dungeons & Dragons to Namco Bandai, one of Hasbro’s major competitors.

According to Hasbro’s complaint, which was filed on Wednesday in federal district court in Rhode Island, Hasbro first entered into a license agreement with Atari in 2000 in which Hasbro granted Atari the exclusive rights to make, market, distribute, provide customer support, and sublicense (with Hasbro’s approval) digital game rights in Dungeons & Dragons.

Earlier this year, however, Atari allegedly sold its European distribution rights to Namco Bandai, which according to Hasbro’s complaint is the third largest toy and game manufacturer in the world behind Mattel and Hasbro.

In this lawsuit against Atari, Hasbro is arguing that Atari breached its license agreement with Hasbro in sharing confidential information related to Dungeons and Dragons with Namco Bandai. For this alleged breach, Hasbro seeks a declaration from the court that Hasbro may terminate immediately its Dungeons & Dragons license agreement with Atari, as well as an injunction against Atari and money damages.

The case is Hasbro, Inc. v. Infogrames Entertainment S.A. a/k/a Atari, S.A., case number CA09-610ML, and it was filed on December 16, 2009, in the U.S. District Court for the District of Rhode Island.

We will continue to follow this case.
Motiva LLC v. Nintendo Co. Ltd.

United States District Court for the Western District of Washington (originally Eastern District of Texas)

Case No. 10-cv-349, Filed March 2, 2010 (originally November 10, 2008)

Case Update 05/24/2012:

Not much new to report.  Just ongoing discovery formalities.  For example, ALJ Rogers granted-in-part Nintendo's motion to compel the production of documents from Motiva back in May of 2011, however the public version of this order has now been issued as of March 21, 2012.  Motiva asserted that the documents Nintendo requested were privileged, that Motiva did not waive privilege, and that the privilege log and accompanying documents Motiva had provided were sufficient.  The first piece of information discussed concerned a freedom to operate opinion ("Standley Opinion") prepared by the Standley Law Group for Motiva. ALJ Rogers determined that Motiva waived its attorney-client privilege when it shared this opinion with a business partner, and thus ordered the company to produce this document and other related communications.

ALJ Rogers further determined that Motiva waived privilege with respect to documents underlying Motiva's domestic industry assertions.  Again, Motiva had waived privilege with respect to the Standley Opinion since it had put its contents at issue with respect to its domestic industry claims.  It was decided that Motiva had further waived privilege with respect to documents that related to patent prosecution and litigation because of its domestic industry claims.   Nintendo argued that it could not determine the accuracy of Motiva's domestic industry investments without certain supporting documents.  ALJ Rogers agreed and ordered Motiva to produce documents related to billing and the subject of the work performed.  ALJ Rogers further ordered Motiva to produce certain documents on its privilege log that were identified as invoices or billing records in addition to its fee arrangement regarding its present litigation.  Nintendo's request for production of Motiva's privileged communications related to patent litigation and prosecution were denied, however, since they were not put at issue.

The last issue decided upon was the privilege log that Motiva had produced earlier.  Nintendo argued that Motiva violated Ground Rule 4.10.1 while Motiva asserted that Nintendo was referring to an old privilege log, and that its amended privilege log complied with this rule.  ALJ Rogers found Motiva's privilege log to be insufficient in many regards.  For example, many of the authors or senders of each document were omitted from the log.  ALJ Rogers further found that documents omitted from the log and documents relating to corporate formation were not adequately explained to be withheld as attorney work product.  Nintendo also argued that communications were being withheld even though there was no indication that an attorney was involved.  For this reason, and because of all other deficiencies found with the privilege log, ALJ Rogers ordered Motiva to produce a privilege log that complies with Ground Rule 4.10.1.

Case Update: June 2011

Initially in the Eastern District of Texas, this case was referred to mediation on March 17, 2009, and then transferred to the US District Court for the Western District of Washington on March 3, 2010. The parties are concurrently litigating a related case in front of a judge at the International Trade Commission. On June 2, 2011, the ITC judge denied Nintendo’s motion to force Motiva to turn over documents that Nintendo alleged Motiva was improperly withholding as privileged.

After reviewing the items ALJ Robert Rogers found that while Motiva did not meet the burden to show that the documents were protected by attorney client privilege (because they did not “in any way reflect or relate to a fact of which the attorney was informed by the client”), they did successfully prove that the documents were protected by the attorney work product doctrine.

This is the latest chapter in the suit’s progress through the ITC. The ITC probe was initially terminated in February because Judge Rogers initially determined that there was no domestic industry that existed to allow Motiva to proceed with this patent-based suit. Prior to filing this ITC complaint Motiva had been involved in district court proceedings in the US against Nintendo but the judge initially found that this was not enough to constitute “domestic activity.” The ITC vacated this determination in April 2011 saying 1) that it was a genuine issue of material fact as to whether Motiva’s district court litigation against Nintendo was related to its licensing activities and thus a “domestic activity,” and 2) that Judge Rogers erred in declining to consider Motiva’s activities in the US before the issuance of their patents (this included substantial amounts of time spent on product development.) The case was remanded to Judge Rogers.

Additional coverage at Law360.

Original Post:

As we previously reported here, Motiva LLC sued Nintendo for allegedly infringing U.S. Pat. No. 7,292,151, which is directed to a "Human Movement Measurement System." The patent relates to "a system and methods for setup and measuring the position and orientation (pose) of transponders. More specifically, for training the user to manipulate the pose of the transponders through a movement trajectory, while guided by interactive and sensory feedback means, for the purposes of functional movement assessment for exercise, and physical medicine and rehabilitation." The suit was filed in the Eastern District of Texas.

In early 2009, Nintendo filed a motion requesting that the case be transferred to the Western District of Washington, the location of Nintendo’s principal place of business. Nintendo argued that not only were portions of physical and documentary evidence located in that district but also neither Nintendo nor Motiva were incorporated in Texas, had offices in Texas, or had any witnesses from Texas. On June 30, 2009, the Texas district court denied Nintendo’s request. Nintendo filed a motion asking the court to reconsider its decision, and also petitioned the U.S. Court of Appeals for the Federal Circuit ("Federal Circuit") to vacate the district court’s decision.
Specifically, Nintendo petitioned for a writ of mandamus alleging that the district court clearly abused its discretion when denying Nintendo’s request to transfer the suit to Washington. Citing the mounting pile of decisions transferring cases out of the very same district, including Volkswagen (545 F.3d 304), TS Tech (551 F.3d 1315) , and Genentech (566 F.3d 1338), the Federal Circuit held that “the district court clearly abused its discretion in denying transfer from a venue with no meaningful ties to the case.” In fact, the Federal Circuit indicated that “[t]his case appears to repeat the erroneous methodology that led this court to grant mandamus in TS Tech.” The decision continued to elaborate on the errors made by the district court, including:
(1) applied too strict of a standard to allow transfer;
(2) gave too much weight to the plaintiff’s choice of venue;
(3) misapplied the forum non conveniens factors;
(4) incorrectly assessed the 100-mile tenet;
(5) improperly substituted its own central proximity for a measure of convenience of the parties, witnesses, and documents; and
(6) glossed over a record without a single relevant factor favoring the plaintiffs chosen venue.

Specifically regarding the plaintiff’s choice of venue, the court again reiterated that the:

Fifth Circuit has unequivocally rejected the argument that citizens of the venue chosen by the plaintiff have a ‘substantial interest’ in adjudicating a case locally because some allegedly infringing products found their way into the Texas market.

This is especially pertinent to the gaming community, as it would be hard to imagine any given district in the United States where a gaming product (such as Nintendo’s Wii and/or its related peripherals) did not find its way into the local market. Similarly, the Federal Circuit took issue with the district court asserting Texas was an acceptable centralized location for witnesses, when in fact, no witnesses resided in that district. While not expressly stated in the decision, the court appeared to recognize that applying such a rule would affect several suits in which one witness resided west of Texas while another witness resided east of Texas. Again, given the nature of video game development and usage across the Internet, applying the district court’s rule could prevent a large portion of transfers for infringement suits involving video games.

Specifically regarding the 100-mile tenant, the Federal Circuit cited the Volkswagon decision, stating: “[w]hen the distance between an existing venue for trial of a matter and a proposed venue under [the relevant statue] is more than 100 miles, the factor of inconvenience to witnesses increases in direct relationship to the additional distance to be travelled.” The Federal Circuit's decision can be read here.

It is important to note that several issues, including: 1) the appropriateness of Nintendo's methods seeking review of the district court’s denial to transfer the suit, and 2) the forum non conveniens factors to consider when deciding a motion to transfer venue, did not relate to substantive patent law, thus the Federal Circuit applied the law of the circuit which the district court is located, in this case the 5th Circuit.

On March 1, 2010, the district court vacated its June 30, 2009 order that denied Nintendo's Motion to Transfer and transferred the matter to the United States District Court for the Western District of Washington.

We will continue to follow the case as it resumes in the Western District of Washington.
Microsoft Corporation v Datel Design and Development Inc., et al
U.S. District Court, Western District of Washington
Case No. 2:2010cv02065, Filed On December 23, 2010

During December of 2011, a settlement was reached in an antitrust and patent infringement dispute between Microsoft and Datel Design and Development Ltd that began in 2009.  To summarize the details of this battle covered partially in a previous post, Microsoft implemented an update to its Xbox 360 system that prevented Datel’s memory cards from working with the console.  Datel sued Microsoft in 2009, claiming that Microsoft’s actions were anticompetitive and in violation of federal antitrust law.  In 2010, Microsoft initiated a lawsuit of its own against Datel, claiming that Datel’s Turbofire and WildFire Xbox 360 controllers infringed its patent that covers the communication between a gaming console and a wireless accessory (U.S. Patent No. 7,787,411).  Datel agreed to stop manufacturing and importing the offending devices, however Microsoft still sought compensatory damages from past infringement despite dropping the infringement case.  Finally, in December of 2011, Microsoft and Datel reached a confidential settlement agreement out of court, ending the 2 year antitrust and infringement litigation. 

Gametek LLC v. Facebook, Inc. et al
U.S. District for the Southern District of California

Case no. 3:12-cv-00501, Filed February 28,2012

Earlier this year, Gametek LLC filed several lawsuits in the U.S. District Court for the Southern District of California against 21 companies including Facebook, EA, and Zynga.  Gametek alleges that these entities infringe upon a patent for a virtual currency and payment system incorporating items bought and used in-game.  Games that allegedly infringe upon the ‘445 patent include popular titles such as FarmVille, Mafia Wars 2, and Poppit! Sprint, to name a few.

The name GameTek was used by a video game publisher prior to its closing in1998.  This publisher, based in North Miami Beach, Florida, created several video game adaptions of popular 90s game shows such as Wheel of Fortunate and Jeopardy!.  The Gametek presently involved in this lawsuit, however, claims its place of business in Newport Beach, California, and does not appear to be the same entity. In fact, the current owner of the business license Gametek LLC has not produced a single game as of the writing of this post.  

Activities of this apparent shell company may be unknown, however the last assignee of the ‘445 patent before Gametek was Theados Corporation, a company that claims to have developed “the world’s first Revenue Operating System.”  Theados Corporation assigned the patent to Gametek LLC last year, and along with it, the right to sue for all past and present infringements.  Gametek LLC seeks through this lawsuit to obtain damages, an injunction that would prohibit the defendants from infringing upon the patent, and attorneys’ fees.

Today Banner & Witcoff was named to the National Law Journal’s inaugural IP Hot List.

The National Law Journal selected 20 law firms who have proven to be innovators in applying legal principles to fast-changing technologies, and who have demonstrated creative strategies for litigation, patent prosecution, licensing and other transactional work. Banner & Witcoff’s ITC work, litigation work at the U.S. Court of Appeals for the Federal Circuit and design patent prosecution work are specifically highlighted in the article.  Unlike many other IP rankings and lists, the NLJ is not a "pay for play" listing of IP firms, but rather reflects an objective assessment by independent analysts.  This national recognition of the firm and its lawyers is indicative of the firm's dedication to achieve and maintain the highest standards within the IP legal market.

Congratulations to everyone at Banner & Witcoff!
The Patent Arcade's own Ross Dannenberg is a contributor to a new book on early video game history.  Before the Crash: Early Video Game History, edited by Mark J. P. Wolf, will give readers a thorough overview of the early days of video games along with a sense of the optimism, enthusiasm, and excitement of those times. Students and teachers of media studies will enjoy this compelling volume.

Following the first appearance of arcade video games in 1971 and home video game systems in 1972, the commercial video game market was exuberant with fast-paced innovation and profit. New games, gaming systems, and technologies flooded into the market until around 1983, when sales of home game systems dropped, thousands of arcades closed, and major video game makers suffered steep losses or left the market altogether. In Before the Crash: Early Video Game History, editor Mark J. P. Wolf assembles essays that examine the fleeting golden age of video games, an era sometimes overlooked for older games’ lack of availability or their perceived “primitiveness” when compared to contemporary video games.

In twelve chapters, contributors consider much of what was going on during the pre-crash era: arcade games, home game consoles, home computer games, handheld games, and even early online games. The technologies of early video games are investigated, as well as the cultural context of the early period—from aesthetic, economic, industrial, and legal perspectives. Since the video game industry and culture got their start and found their form in this era, these years shaped much of what video games would come to be. This volume of early history, then, not only helps readers to understand the pre-crash era, but also reveals much about the present state of the industry.


Mark J. P. Wolf is a professor in the Communication Department at Concordia University Wisconsin. His books include Abstracting Reality: Art, Communication, and Cognition in the Digital Age; The Medium of the Video Game; Virtual Morality: Morals, Ethics, and New Media; The Video Game Theory Reader; Myst and Riven: The World of the D’ni; The Video Game Explosion: A History from PONG to PlayStation and Beyond; The Video Game Theory Reader 2; and the forthcoming two-volume Encyclopedia of Video Games. He is also founder of the Landmark Video Game book series and the Video Game Studies Scholarly Interest Group within the Society of Cinema and Media Studies.

Contributors: Jessica Aldred, Ralph H. Baer, Brett Camper, Karen Collins, Ross A. Dannenberg (Editor of Patent Arcade!), Leonard Herman, Erkki Huhtamo, Carly A. Kocurek, Sheila C. Murphy, Ed Rotberg, Tim Skelly, Carl Therrien, Staci Tucker, Zach Whalen, Mark J. P. Wolf
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