Not all created equal

… but that’s ok.

A long long time ago in a paper far far away (Reynolds 2003 – Commodification of Identity in Online Communities) I went on about how if items in virtual worlds could be seen as property but they probably had a unique set of properties that related to the potential harms that could be associated with them. I also said that avatars were different (Reynolds 2003 – Hands off MY avatar).

And, I said, and said again that this would NOT be decided by an IP lawyer or case but something else, probably divorce of or something where a judge would look at what was happening and what people valued and not obsess about IP law.

My general thesis is that looking at virtual items as IP wrapped in contract is just wrong. Much of the argument about this has been framed by IP and contract law which I’ve always objected to as it’s simply an application of the principle that if you have a hammer everything looks like a nail, and IP / Contract law is a very good legal hammer. As I’ll get into below just because two things share some properties e.g. being physical and portable or intangible and non- rivalrous, does not mean they have the same legal or specially property related attributes.

Those following all of my recent posts will start to see a pattern here – last post on play was about primacy of meaning, this post is about what the meaning of virtual items in games is, see where I’m going here…

So, this shift from IP / Contract interpretation actually started to happen almost immediately with: Li Hongchen v. Beijing Arctic Ice Technology Development Co. Ltd., where a company was ordered to return virtual items that were taken from a player’s account through hacking.

TN had some commentary at the time:
http://terranova.blogs.com/terra_nova/2003/11/chinese_gamer_s.html 
http://terranova.blogs.com/terra_nova/2004/02/arctic_ice_sued.html 
http://terranova.blogs.com/terra_nova/2003/12/virtual_propert.html

However I’m not sure if people read the judgment or just the western news reports as there was commentary that the case was more about Duty of Care than property. Arctic Ice was found to have a Duty of Care but the judgment also orders them to do a ‘return of property’ (google translation) or ‘return of belongings’ (bablefish). There is a summary of the case and the full judgment over on the Virtual Property Network: http://www.virtualpolicy.net/arcticice (tVPN is looking for native speakers of a few Asian languages to aid with research – contact me if you are interested (there’s no $ on offer at the moment, sorry)).

Following the Arctic Ice case there have been a bunch dealing with variously aspects of virtual items, in particular a 2008 case that found that a particular act of taking virtual items taken in RuneScape constituted theft under Article 312 of the Dutch Criminal Code.

We now have a UK case where someone taking virtual items and being found guilty of theft: http://www.develop-online.net/news/36921/Zynga-hacker-faces-jail-after-12m-theft thanks Jas http://www.gamerlaw.co.uk/ for the link. Here someone ‘hacked’ into Zynga (I wonder if in fact it was individual user accounts the news item is not clear) and transferred ‘virtual poker chips’ he then sold them to players on the ‘black market’. The old school way of dealing with this is to say: nothing happened here the IP is not owned by the players, the contract say these things can’t be bought and sold so you are all in trouble, and if there is anything bad it’s hacking. But no, judge said it was theft.

So, it looks like virtual items are something that more jurisdictions are seeing as capable of being stolen. This is an interesting move as it changes one characterise of virtual items. It might be seen as a perilous one as if items can be stolen does this mean that other attributes must be applied to them i.e. if they are stolen do the have the kind of value that requires a particular Duty of Care, specially does virtual currency become so currency like that virtual world providers have to take MindArc’s lead and become a bank?

This is a possibility but not a necessity.

What policy makers will need to be reminded of is that the word ‘property’ applies not to things but to a set of socially agreed characterises that we attribute to things (both physical and intangible) what’s more and what’s critical is that we don’t apply exactly the same attributes to all things that we might term property (or at least property like).

To illustrate this here is a table of some properties and how the variously apply to things (this is mainly under UK law by the way, so we have odd things about Organ Donation which has to be a gratuitous gift – hence the odd attributes of being Alienable in the sense of transfer of certain rights, but not for money).

This is a very quickly drawn and, I’m sure, far from 100% accurate table of ‘things’ and the kinds of legal attributes that have in a property-stylee

What I think is interesting to note in this table is the range of attributes that are applied to things that have the same or similar attributes looked at from an abstract perspective e.g. human organs and chairs are both objects that are portable, but we treat them very differently. Of course we do, you might say. But there is no ‘of course’ about it, the table above has been negotiated over many years and is still shifting. 

There is not room to go into it in detail here but laws in respect of the human body and parts thereof are fascinating and labyrinthine. In this area whether there is property in something, who’s property that is and what rights are granted depends on a huge range of factors such as: what the thing is - body, re-generative part (blood), non-regenerative (heart), reproductive (sperm); who the actors are and how they stand in relation to each other - individual, institution, parent, other genetic relative; and, what they want to do - give, use, buy, experiment, commercially exploit products of research etc.

Added to this there are odd cases e.g. Mark Quinn’s work ‘self’ which is a sculpture of the artists’ head made from his own blood, which while being a Human Tissue was still sold as an art-work. Then there is the famous HeLa cell line case.

It’s not just squishy stuff that is weird – see: rights in actor’s digital motion capture and the Robert Patrick, Terminator 2 / Jurassic Park case.

The point that I’m ramming home here is that the way one should look at legal attributes of a thing is not to look at some material or other factors then on the basis of them look at the closest other thing and go ‘right, it’s another one of them’ – as we have with much virtual stuff. Rather one needs to look at the social role a thing plays and what the rights, duties, and potential harms to people are – then work out the set of attributes that balance these.

Another thing to not is the relationship between the legal attributes of a thing and the regulation of those attributes. Law of course is a regulatory force but it’s worth noting that there is a wide variety of statutory and non-statutory regulatory bodies that are involved in creating and enforcing laws and other rules.

Back to the squishy stuff – regulation of what can be done to the body or parts thereof falls to, among other things, the criminal law, sporting bodies, special bodies such as The Human Fertilisation and Embryology Authority.

So, is this what things look like now in MMORPGs in most jurisdictions? 

 

I will spare you, good reader, a line-by-line, jurisdiction-by-jurisdiction analysis of this table (there some of this already over on tVPN, see tVPN White Paper on Virtual Items and Public Policy and tVPN Global Policy Updates). A little explanation might help though. I’m suggesting that Avatars, for example, are an are not Rivalrous because at a certain level they can simply be re-produced but at another level one cannot have items in a given name space e.g. multiple simultaneous instances of the same character name on an MMO server. I have also said that things like Virtual Currency have mixed regulation because virtual currencies are regulated in virtue of them being Intellectual Property and being on a server somewhere, however that’s not really regulation at the level of ‘currency’ whereas in places such as China Virtual Currency is regulated qua currency.

What’s next?

There will be a growing weight of cases that will increase the person-property like nature of virtual items. The EULA will matter less and less. The liabilities of providers will start to be questioned as the gap between the Duty of Care forced upon them by courts increases and the gap with the EULA gets greater. Government will seek to regulate both virtual currency and virtual items with greater force - requiring publishers to become more and more bank like. I do lots of blog posts titled ‘I told you so part n’.

There is an alterative.

Non-state regulation of virtual items!

The details of this, the why and how is what Dr de Zwart and I will be presenting at The Game Behind the Game. But before we stand up and do that, I wonder if anyone is on the same page or is there something I’m missing?

Comments

[Nich]

1.

Close to the reasoning behind the Arctic Ice case, I wonder how the relationship between user and virtual items hasn't managed to escape the IP conundrum all these years to subscribe to a more directly attributed user/account schema. You may see this as something like our relationships with personal/professional telephone numbers. When initially allocated, these don't have much meaning. Invested with personal time and associations, however, they acquire sufficient significance to justify when I am changing telephone provider to retain the same number. That's one suggestion.
The Arctic Ice court kind of referred to this logic, as well as to the commercial relationship with the service provider, where the account is an open-ended development space, to be shaped at the discretion and capacity of the user. The provider had a duty to preserve/not to alter the content of the account.
In either approach there's no link to IP logic. And the concept of property is toned down, the personality-property argument being absorbed by market-friendly rationales of harmonised B2C relations.

[Richard]

2.

Ren>So, it looks like virtual items are something that more jurisdictions are seeing as capable of being stolen.

There's an extra layer that needs to be taken account of: some virtual items are capable of being stolen, but it's not a crime because that's part of the game. MUD1 had a STEAL command which caused the character of the person issuing it to attempt to transfer the object in question from the inventory of another character to their own character.

Context is everything...

Richard

[Dean]

3.

Correct me if I am wrong, but wasn't this aspect addressed in the case of eve online in the white paper cited

[Ren Reynolds]

4.

Dean - Yes it was

Richard - As Dean notes, I have this in the white paper where I looked at the case of banking in SL and EvE. At one level exactly the same thing happened but of course contextually quite different things happened. I should have put this in the post and not expected everyone to read the white paper as actually it's a critical point, and one that I think both of us never miss an opportunity to push home i.e. that any law that might be put in place runs the great danger of unintended consequences.

This is one of the many reasons why I'm thinking that a non-state layer of regulation - which has people that know what they are taking about is a good idea, if the alterative is (probably) bad law. This is not a perfect solution, but there is no perfect solution that's attainable.

ren

[Ren Reynolds]

5.

Nich,

>Close to the reasoning behind the Arctic Ice case, I wonder how the relationship between user and virtual items hasn't managed to escape the IP conundrum all these years to subscribe to a more directly attributed user/account schema. You may see this as something like our relationships with personal/professional telephone numbers. When initially allocated, these don't have much meaning. Invested with personal time and associations, however, they acquire sufficient significance to justify when I am changing telephone provider to retain the same number. That's one suggestion.

That’s an interesting one. As I’m pretty sure we don’t own our phone numbers and it’s not only one organization but an industry that has a duty of care toward them – in the EU this is defined I a Directive and in the UK it falls under the powers of Ofcom an industry regulator, and it seems that much of the world has put similar stuff in place.

>The Arctic Ice court kind of referred to this logic, as well as to the commercial relationship with the service provider, where the account is an open-ended development space, to be shaped at the discretion and capacity of the user. The provider had a duty to preserve/not to alter the content of the account.

Yes

>In either approach there's no link to IP logic. And the concept of property is toned down, the personality-property argument being absorbed by market-friendly rationales of harmonised B2C relations.

Nice thinking, I shall ponder on this more.

ren

[Richard]

6.

Ren>As Dean notes, I have this in the white paper where I looked at the case of banking in SL and EvE. At one level exactly the same thing happened but of course contextually quite different things happened. I should have put this in the post

It's not so much the post as the diagrams. If someone were to look at the diagrams, they wouldn't know that there were nested contexts. That doesn't mean I know how you'd represent it graphically, mind you..!

Because virtual worlds can simulate the real world, in theory anything you have in that diagram can be let to the virtual world with a different value. Furthermore, the virtual world itself could sub-let it to a world-within-world. For example, there could be (and probably are) stand-alone game sub-worlds in SL that have different ideas of the acceptability of, say, the stealability of objects to SL itself, which in turn could have a different idea to that of RL.

Richard

[Ren Reynolds]

7.

Richard,
The main point of the diagrams was to show that there is a range of views of what virtual property current defined by legal jurisdiction, and also to show that the non-lawyer / policy / public view of property being a black and white thing is quite wrong also. There's a lot lot more to be said on all the points, it's the problem with trying to present things simply.
ren

[greglas]

8.

Ren,

I agree that the law is in flux and we'll get growing recognition of virtual property interests. But I'm not sure where you're going with this ultimately -- you're suggesting that non-state regulation will emerge? If so, how? And doesn't this already happen, essentially -- e.g. Blizzard shutting down the accounts of suspected gold-farmers?

[Account Deleted]

9.

Very interesting work! Here are some comments.

* While Li hongchen case is surely the globally first known decision regarding virtual theft, in fact, it's not the first one. S. Korean criminal court have dealt with similar case since 2002. (Please see footnote #60 in my paper; http://papers.ssrn.com/sol3/papers.cfm?abstract_id=905748 ; The first decision was decided by a judge of Busan District Court on March 6th 2002)

*Unlike Dutch and UK court's decision, S. Korean Judges do not apply the "theft" clause of The Penal code to the case. Intead, they chose "infringement on another person's information" clause of the Act on Information Protection. That means virtual sword are not virtually treated as a sword in Korea; virtual item is not "nothing" but also not a "thing".

* Under The Game Industry Promotion Act, there is no discrimination between virtual currency exchanging and virtual items exchanging. Any currency/item earn by luck or abnormal play should not be trade, while, either one by human's sweat & normal play can be sold.

[Account Deleted]

10.

Sorry. Here's the corrected URL on my paper. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1113327

[Ren Reynolds]

11.

Unggi,
Interesting cases. I draw attention to the Arctic Ice one as there the judge explicitly rejected the argument that the virtual items were just a 'pile of bits' and did refer to them as the players property. I'm not sure tho if the person that took it was found and if so what they were charged with.

I'm trying to get away from property / not-property; thing / not- thing dichotomies so your notes on S. Korea are very interesting.

I have been trying to find the detail of some S. Korea cases but they have proved a little difficult to find on the web.

[Account Deleted]

12.

Ren,

According to Gamer/Law blog, It seems not definitively certain that the UK court found virtual goods = property, because of the difficulty of accessing the court transcript.
http://goo.gl/SjVL9

At present in S. Korea, most of Highest Court transcripts & little selected lower court's are officially disclosed for the public(of course in Korean). So, it's near impossible to access to the rest decisions of lower courts except through news or dissertations.

This year in Korea, there are 2 big legal events on VW/game.

One is the movement of revising Game Act(that including so called cinderella clause;shut down game service online at night for protecting kids & youth's sound growth, and the clause to ban producing & distributing Bot programs),

the other is whether e-sports player can be qualified to the title of the neighboring right in copyright act just as violinist or actor(the case are pending in the lower court). http://goo.gl/aVj3h

--Unggi

[Ren Reynolds]

13.

Unggi,
Thanks for the clarification on the UK decision. I think Gamer/Law is trying to track down the detail as it's an important case in the UK.
Glad to know it's not just my google skillz that are lacking on the Korean case side.
ren