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Archive for April, 2010

Nintendo shuts down fanmade Pokemon MMO.

An image from before Pokenet was taken down

Last week, Pokenet, a fan made online game that allowed players to login as Pokemon trainers and catch and trade Pokemon, turned off it’s servers after receiving a cease and desist letter from Nintendo. The event raises a few interesting legal questions.

First, is it correct to say, as the headline of the story did, that Nintendo “shut down” the site, or is that angry rhetoric from the online community? In a literal sense, in order for Nintendo to “shut down” Pokenet they would have either had to physically turn the servers off or obtained a court order commanding the developers to close up shop. A cease and desist letter doesn’t do either of these things. Nintendo’s attorneys told Pokenet that it was Nintendo’s opinion that Pokenet violated trademark or copyright rights and that if the site was not shut down, further legal action would follow. Pokenet didn’t have to comply. They could have retained an attorney and fought back. However, Nintendo is a massive company with an in-house legal staff and access to multiple powerful law firms. Pokenet was a collection of web developers creating a website in their spare time. The notion that they could have afforded a viable defense is laughable. So in that sense, yes, Nintendo shut down the site. It is worth remembering, though, that a cease and desist letter is not a court order and legal authorities will not act on it (that would require a temporary or permanent injunction), it’s a warning and a demand from one person to another (or multiple people). There have been David’s who have fought back against such Goliath’s in the past, often aided by talented attorneys looking to do some good for cheap.

A second question is whether or not Pokenet was in the wrong. Did they actually violate Nintendo’s trademark? The US Trademark & Patent Office grants protection for trademarks that are used in specific areas of commerce. I may, therefore, start lawfirm and call it Emerald City Law Group after my beloved Seattle. I could register the trademark for legal services. This registration would not stop someone from opening up an Emerald City music shop or bike store. I don’t own “Emerald City,” it’s a nickname for Seattle. Greater protection is given for names that are completely made up, such as Kodak or Bravia (or Pokemon). These words often receive a kind of global protection in that I couldn’t start a Kodak music shop or Bravia bike store, such names are so distinct that only the companies that coined them may use them. Looking at Pokenet, they lose on both considerations. The trademark “Pokemon” is registered for online video games and the word was made up. So, even if a kind hearted First Amendment attorney had wanted to take on Nintendo over the website, they would have lost.

Another question is why Pokemon went after Pokenet. The site didn’t charge users any money and only had 7,000 users at the time of shut down, so the “threat” posed to the core IPs and profits would seem to be minimal. Presumably, users of Pokenet are avid Poke-freaks who will still buy the games, collect the cards, and watch the show. Doesn’t Pokenet actually raise the profile of the brand? Why would the Elephant need to squash the bug? The first is that Pokemon holds a valid trademark and has the right to control the use of the mark in the video game space. If they deem it a business asset to be the only game in town, they may do so. Pokemon may someday want to launch such a program, but even if they don’t, they have the right to stop anyone else. Pokemon may have had reasons other than financial to shut Pokenet down, the game may have been subpar and made the brand look bad.

Another reason Pokemon went after Pokenet is the property doctrine of laches, which states that the true owner of a property may lose rights to the property if they don’t actively protect it when someone attempts to encroach. The doctrine has been ported to intellectual property, so Pokemon is forced to go after the small “trespassers” if they want to retain the right to go after the large ones.

One last irony is that if Pokenet had been a satire of Pokemon, rather than a faithful recreation, they would have stood on higher legal ground. Spoofing, satire, and commentary are protected under free speech. So if the developers at Pokenet wanted to do a build of the game “Pinch-and-Chew” instead of “Pikachu” and make fun of the original IP, they’d be fine. However, because they made a game that honored the core IP, they can’t fight back. This may seem like a backwards result, but sometimes that what the law gives.

*Note: I refer Nintendo and Pokemon interchangeably in this posting. The two companies are separate entities in the US, but as Nintendo’s legal department is much larger than Pokemon’s, the junior company uses the Big N for anti-piracy and similar type matters. Without seeing the cease and desist letter, it cannot be said if Nintendo, Pokemon, or outside counsel actually flexed the muscle in this case.

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In response to my last post, someone asked me if my hypothetical chef stealing the recipe’s would get in trouble under trademark for for claiming to be affiliated with the original chef. My response, as any good lawyer would do, was to tell him “it depends.”

Whether or not the use of another person’s trademark is legal depends on the type of use. Trademarks are words/pictures/etc. that identify the source of goods. Trademarks exist for the purpose of helping consumers know what they’re buying. If one prefers Sprite over 7up, the logo and words “Sprite” adorning the bottle will let that person know they’re getting what they want. 7up would be violating Sprite’s trademark if they put “Sprite” on their bottles, because the use would be likely to confuse consumers as to what they were buying. Likelihood of consumer confusion is the critical question of trademark infringement.

Free Speech in action

7up is perfectly free to have commercials with “taste tests” showing people choosing their drink over Sprite. The ad can talk about Sprite, use a can with a Sprite logo and show interviews with people talking about how much they hate Sprite. The reason is because of a the trademark doctrine of “Fair Use” which is based on our free speech rights here in the US. Sprite may not use its trademark to stop people, including competitors, from talking about them. Sprite can’t stop me from talking about them right now or using their trademark to make my point. I may be harming Sprite’s reputation, I may not be, but I am not confusing anyone that I am a Sprite spokesperson.

Returning to our chef. If “impostor chef” outright lies and claims to be “original chef” or uses the same restaurant name, he is infringing the mark. If he says “uses recipe’s from original chef” or “taste’s better than original chef” then he’s all good, just speaking his mind under the protection of the Constitution.

People have attempt to use Trademark to stop competitors from gaining advantages on a regular basis. One of my favorites was when Bumblebee Tuna attempted to stop a maker of tuna salad the salad was “made with Bumblebee Tuna.” They lost because the consuming public in that case was deli workers and they would know that the salad in question was not “Bumblebee Tuna Salad” but rather salad made “with Bumblebee Tuna.”

In another case, Playboy attempted to stop a former model from claiming she was a former “Playboy Playmate of the Year” on her website. This was an internet case and Playboy was concerned that seaches using the keyword “playboy” or “playmate” would find this model and not them. The court had none of it. The fact was that she was former Playboy Playmate of the year and she can say so as often as she likes.

There are other considerations when using another person’s mark that artists should be aware of. The biggest is that you risk pissing off the mark holder and, depending on your reason for using the mark, maintaining a good working relationship with the mark holder may be more important than your planned use. Spite and 7up are business competitors engaged in adversarial marketing, they’ll never be partners, so the uses can get as nasty as they want. The former Playmate, however, may have wanted to maintain a positive relationship with Playboy. Perhaps there are reunion opportunities for former Playmates that could have been positive for her career. Such invitations would likely dry up after she and Playboy took legal action against one another. As my business law professor said in law school, “You may sue your supplier, but even in you win, you’ll need a new supplier.”

Another consideration is where one can afford the cost a making a fair use defense. Even if you’re in the right, being dragged to court can get costly very quickly. I’ve often wondered if this is why reality shows like Mythbusters take steps to blur or cover logos from the products used in busting. Mythbusters is perfectly free to do a test and discover at what temperature a Twinky explodes. Such knowledge could even serve the public. Reality shows were invented to keep the budgets low, however (costs for writers and actors are nominal compared to other genres) and inviting litigation from Coke or Hostess just isn’t thrifty. The Mythbusters may also be aiming to not upset brands, as their show depend on ad revenue.

Free Speech in Hyper-Action

But, if you’re an artist and you don’t care what the big bad rights holders think of you, then feel free to toss your Barbie in a blender or make an animated short using every logo you can fit into one screen. The law is on your side.

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