Yes
About £34 million worth.
For legal / tax nerds here is the First-Tier Tribunal of the Tax Chamber's Decision: http://www.financeandtaxtribunals.gov.uk/Aspx/view.aspx?id=6744
For the rest of you - McLaren is a Formula 1 Motorsport team. It cheated. It obtained confidential information about another team, Ferrari, which McLaren intended to use for its advantage.
This was found out and the bodies that run Formula One (The Federation L'Automobile (FIA) and World Motor Sport Council (WMSC) the FIA's General Assembly). Accordingly they decided that McLaren had broken its rules: the International Sporting Code (ISC) which are enshrined contractually in the Concord Agreement between FIA, Formula One Administration Limited (FOA) and the teams. They issued a fine of £32 million.
Then it got interesting.
McLaren did its tax return and stated that it had a reduction of gross income of £34 million (fine plus related stuff) and what's more this loss is deductible against earnings.
The UK tax authority HMRC disagreed.
There was a trubunal.
McLaren won.
There may be an appeal.
But
If there is there's a much better argument McLaren can use next time.
The underlying law in this case is quite simple. To quote from the tribunal:
Section 74(1) TA 1988 provides that in computing trading profits no sum shall be deducted in respect of:
(a) any disbursements or expenses, not being money wholly and exclusively laid out or expended for the purposes of the trade or profession; ...
(e) any loss not connected with or arising out of the trade or profession.
McLaren's legal team made the kind of straight down the line argument that one would expect from (what I presume are) non-gamers. And it worked (though by a split decision), so let's not knock it.
In short McLaren argue that the fine was an expense related to the trade that they were engaged in. That there are exceptions to this such as statutory fines, but this was not such a fine, it arose out of the contract between them and the sporting body and it was not a 'punishment' but a commercial deterrent as such it was a risk of and thus an expense of trade.
The way that this has been presented in some elements of the UK media is a some what popularist version of the dissenting opinion in the case by Dee. This opinion holds that the fine was a punishment and that 'fines and penalties' of a similar nature are not allowable under tax law. What's more "the conduct of McLaren fell way outside any normal and acceptable way of conducting their trade, as found by the WMSC."
The problem with this view is that it misunderstands the nature of games / sport and in particular their relationship with law.
To put it simply the sort of conduct that is accepted as part of a gaming or sporting practice is not just that set out by the rules but also a wide set of acts that are within the tradition of the actual practice of that game or sport. That is, there are types of cheating that while outside the rules of the sport are still seen as being within the bounds of that sport.
This is most clearly seen in contact sports. Here, not only are acts such as punching (boxing) and tackling (rugby) allowable and are not criminalised - even when players die as a result of such act. But there are a wide set of acts that are seen to be within the sport e.g. a punch in rugby or hitting a boxer when they are down. These infringements are governed by the relevant sporting body and not by law.
In general the criminal law of most countries will stand to one side and allow those bodies to deal with the infractions. Indeed the formal structure of sports is designed around explicit and implicit contracts that anticipate rule infractions - hence by contractual definition they are within the definition of the sport in at least one sense.
There are also boundaries that players and other actors (these apply to officials in the case of in-game judgments, bribary and other matters) may step over where the criminal and other laws will step in. These are some what fluid and circumstantial relying, among other things, on the nature of the sport and norming power of the sporting body. The go to case in this area is Cey (Regina v. Cey, [Regina v Cey 48 C.C.C. (3d) 480 (Sask. CA. 1989)).
Hence, as Formula 1 is a sport I suggest there is an overriding argument from the tradition of sports law that the infraction by McLaren is part of the practice of sport and hence constitutes an element of their trade. The counter argument would be an exception case that would fail one or more of Cey's tests or analogous ones applied to the type of action taken by McLaren. However the fact that the fine is not criminal in nature and that no such fine or other action has been mooted is a strong argument against this, as I suggest are the particularities of the WMSC judgment - though in any specific example this is amatter of judgment based on weight and interpration of facts, history and tradition.
In summary McLaren have a sound argument that their acts, despite being against the rules, can be considered to be within the actual practices likety to be associated with Formula 1 in the real world and thus any resulting fine from a governing body is, by defintion, a cost of trade.
For a Terranova treatment of some elements of sports governance and law see:
Reynolds, R. “The Emperor’s (New) New Clothes.” Terra Nova, April 18, 2011. http://terranova.blogs.com/terra_nova/2011/04/the-emperors-new-new-clothes.html.
For a legal treatment os similar issues see:
Reynolds, R, and M deZwart. “Call of Duties: The Arbitration of Online Game Disputes.” In Conference Proceedings. Rutgers: Rutgers School of Communications and Information, 2011. http://www.scribd.com/doc/57503838/GBVG-Proceedings-v1.
Reynolds, R, and M deZwart. “The Duty To ‘Play’: Ethics, EULAs and MMOs.” Edited by A Krotoski. International Journal of Internet Research Ethics, no. 3.1 (2010). http://ijire.net/issue_3.1/5_Reynolds_deZwart.pdf.
For a philosophical treatment of the ethics of in-game practices see:
Reynolds, Ren. “Ethics and Practice in Virtual Worlds.” edited by John Richard Sageng, Hallvard Fossheim, and Tarjei Mandt Larsen, 7:143–158. Philosophy of Engineering and Technology. Springer Netherlands, 2012. http://dx.doi.org/10.1007/978-94-007-4249-9_10.
A few days ago, there was an interesting ruling in the Triple Town / Yeti Town game cloning case, a.k.a. Spry Fox, LLC v. Lolapps, Inc. Triple Town and Yeti Town are both casual puzzle apps where tile elements are assembled and evolve. Spry Fox had sought to license the game to the defendants, but the defendants pursued a cloning strategy instead. The litigation presents roughly the same sorts of legal issues as the current EA/Zynga dispute and the recent Tetris clone decision.
This particular case has been talked up pretty extensively in the blogosphere over the last year. For instance, James Grimmelmann had some thoughts about the early stages of the litigation and game cloning generally:
"if Triple Town flops on the iPhone because Yeti Town eats its lunch, at some point Dave and his colleagues won't be able to afford to spend their time writing games any more."
Eric Goldman weighed in yesterday on this new ruling, connecting it to the EA litigation:
"The Triple Town ruling suggests that Zynga probably can’t score a quick win."
And even Marty Schwimmer chimed in with some thoughts about an Alaskan verison of Gone With the Wind.
So, not to be left out, here are my two cents.
At the heart of these cloning disputes is a simple question: how closely can you copy a video game? In other words, how does copyright law apply to video games? The cloning controversy is an old one, but there are many critics (and some defenders) of the common industry practice of copying game mechanics while essentially swapping in new art assets to make the clone not an exact copy. But does that strategy always work as a matter of copyright law?
The big problem for copyright protection here is that copyright does not protect games as systems -- something that Bruce Boyden explains (excellently) at length in this paper. Section 102(b) of the copyright statute codifies the so-called "idea/expression" dichotomy and expressly forbids copyright protection for ideas and systems. But as applied to video games, where is the line between expression and system?
This case doesn't answer that question, but it contributes to the discussion. The procedural posture in Triple Town is a ruling on a motion to dismiss, which puts a higher burden on the movant -- the defendant here. The legal question is whether Spry Fox (the plaintiff) has alleged facts that, if proven at trial, could result in a favorable ruling. So this opinion is no decision on the merits -- this is just about whether Spry Fox can make out its case in theory. However, in a typical copyright case like this one, most of the facts are pretty obvious, so I think it's fair to say that this ruling does a little bit more than the typical ruling on a motion to dismiss.
So it is worth paying attention when the court says interesting things about the nature of video games:
"...written description of the visual aspects of the games is not as effective as the side-by-side 'screen shots' that Spry Fox provided in its complaint, and that those screen shots are in turn less effective as a comparison between the two games than actually playing them. Neither Spry Fox nor 6Waves suggested that the court should compare Triple Town and Yeti Town by actually playing them."
In the past, many courts have analogized video games to films and other conventional media in order to perform an infringement analysis. But am I right to read this as the court saying that procedural similarity was not something briefed by the parties so it's waived (perhaps)? The court makes a similar point later:
"It is as difficult to compare two video games by looking at a few screen shots and reading written descriptions of game play as it is to compare two movies by looking at posters and reading excerpts of screenplays"
So my impression is that the judge would welcome a comparison of game play in order to do a copyright infringement analysis, which is pretty interesting. Not many courts have opened that door.
Further on:
"At this stage of the litigation, where the court has only the complaint, its description of Triple Town, and the accompanying screen shot images, the court concludes that the idea underlying Triple Town is that of a hierarchical matching game, one in which players create objects that are higher in the hierarchy by matching three objects that are lower in the hierarchy. Frustrating the player’s efforts are antagonist objects; aiding the player are objects that destroy unwanted or ill-placed objects. Spry Fox’s copyright gives it no monopoly over this idea. 6Waves (or anyone else) is free to create a video game based on the same idea...."
So there can be no copyright for game design at this level of game mechanics, because protecting that would amount to protecting an idea/system, which is barred by 102(b). Pretty interesting. But then, in what some have called a "switcheroo," the court says:
"A video game, much like a screenplay expressed in a film, also has elements of plot, theme, dialogue, mood, setting, pace, and character. Spry Fox took the idea underlying Triple Town and expressed it with its own characters, its own setting, and more. These objective elements of expression are within the scope of Spry Fox’s copyright."
So... to the extent that a game idea is embodied in "objective elements of expression" that resemble "plot, theme, dialogue, mood, setting, pace, and character," those things are not an "idea" and may be within the scope of copyright. But how do we distinguish between "objective elements of expression" and the "idea" in Triple Town? The idea part of Triple Town seems to be set forth above, but what are the "objective elements" of Triple Town? The court doesn't spell this out in the abstract so much as it demonstrates its understanding by applying it to the facts:
"Spry Fox’s allegations are more than adequate to illustrate plausibly the objectively similar expression embodied in Yeti Town. The object hierarchy is similar. Progressing from grass to bush to tree to hut is similar to progressing from sapling to tree to tent to cabin. Perhaps more importantly, the object hierarchy coupled with the depiction of the field of play comprise a setting and theme that is similar to Triple Town’s. A snowfield is not so different from a meadow, bears and yetis are both wild creatures, and the construction of a “plain” is not plausibly similar to the construction of a “patch,” at least as the two games depict those terms. Whether 6Waves’s choice of language in its dialog boxes is similar enough to Spry Fox’s is a closer question, but it is a least plausibly similar. There are apparent differences between games (for example, yetis are not bears and “bots” are not campfires), but a court must focus on what is similar, not what is different, when comparing two works."
Did you follow that analysis? The court has said that "hierarchical matching" is an idea above. But here the court seems to place the particular "object hierarchy" within the scope of copyright. Bears are not yetis -- but Yeti Town resembles Triple Town in that it mirrors a "wild creature" object within the hierarchy. Snowfields are not meadows, but again, this is just swapping out one object for a similar object that can fit in the same slot in the hierarchy. And the end result creates a similar "setting and theme." I think I get what the court is doing here, but Eric says it "isn't entirely clear" and Marty concurs about the ambiguity.
But in my opinion, if you borrow some basic concepts from object-oriented programming, it isn't that hard to understand. E.g., meadows and snowfields are part of a terrain class, yetis and bears are a mob class, etc. Class similarity within a game structure, can count for something in copyright law. Just as narratives can deploy certain characters (the sidekick, the snitch, the brute) in certain patterns, so video games can be formally mapped as particular sorts of object relationships with a skin of narrative.
This analysis, I think, resonates with Jesper Juul's notion in Half Real that games are merger of rules and fiction. It also ties in with Ian Bogost's forthcoming Game-O-Matic -- a piece of software that takes certain relationships embodied in a formal game structure and allows the user to insert the objects that the game "verbs" animate.
Again, it's important to note that this decision contributes to a conversation about game copyright -- it does not settle the issue. But it nudges copyright a little bit further toward protecting game mechanics. Even if you don't follow what the court is doing, I think that, based the court's analysis, if this were EA v. Zynga (instead of Spry Fox v. Lolapps), EA would win.
But the more important question is: What should the rule be here? Game design as an art deserve some form of protection, surely. Bruce is right that 102(b) is tilted against the protection of games, but what is really behind the idea/expression dichotomy? The way I explain the idea/expression line to my students is to say that the copyright monopoly should end when copyright threatens private control over things that are truly important. Facts, for instance, must be available to all. Important ideas (discoveries, theories, laws of nature) must also be available to all. Basic plot structures and genres must be available to all, because they serve as platforms for new creativity. So the idea/expression line is really about, imho, keeping certain things outside the sphere of private ownership as a matter of optimal policy.
I admit that I am not happy about companies that clone innovative game mechanics. It does not seem fair or likely to produce a better marketplace in game titles. When a game is essentially cloned, there's a danger that the production of genuinely creative games will go unrewarded and that companies making quick clones will be more profitable than those that spend money on new ideas. That does not seem like a fair or healthy way to set up the games industry.
But there are serious dangers in letting copyright be the solution to this unfairness. If the protection of game mechanics expands too far, the cure could be worse than the disease. Game companies could end up owning specific video game genres for over a century due to the crazy duration of contemporary copyright law. The creation of new independent games could be chilled by fear that the mechanics too closely resembled those in a game by EA, for instance. That result would be as bad-- or worse-- than the clones.
Hopefully the courts can find some kind of happy balance, shutting down the most egregious clones without creating monopolies in new genres. But I'm a bit worried, given the trends we've seen in other realms of intellectual property law. Awarding copyright protection in plot-like game mechanics in a way that maximizes the prospect of future creativity will be a tough thing to do. Courts pushing out the boundaries of copyright in games should do so very carefully.
Jokes. They can go wrong. Very wrong.
But….
Sometimes it’s ok.
On 6 January 2010 a tweeter called Paul Chambers was really looking forward to meeting up with a woman he’d started a relationship with online. He really really wanted to meet her. The problem was he was in the UK and she was in Ireland and it was January. Now if you know the UK you know we don’t ‘do’ snow. It’s weird white stuff we only see on xmas cards. Most of all roads and airports just don’t /do/ snow. So on hearing that his local airport was closed Paul Chambers tweeted:
Crap! Robin Hood Airport is closed. You’ve got a week and a bit to get your shit together otherwise I am blowing the airport sky high!!
Then you know what happened?
Nothing.
Then more nothing.
Then a bit later a bit more nothing.
Then several days later while searching for tweets about ‘Robin Hood Airport’ staff found the tweet. Then things got bad for Mr Chambers. Bad as in 4 2 years later he’s in the High Court in front of the Lord Chief Justice of England and Wales – and that’s gotta count as bad in most people’s books.
So, to cut to the law – Chambers was charged and then convicted under the 2003 Communications Act. This says that you can’t send a message that's menacing, grossly offensive, indecent or obscene using a public commutations network.
As you may imagine this conviction freighted the bejebus out of anyone and everyone who’s concerned with human rights, free speech, jokes on twitter and what one man (or woman) might say when they want to get into the pants of another (man or woman or both).
This in turn resulted in some high-powered legal minds in the UK taking the case on and fighting it all the way to the High Court. It also resulted in comedians taking a stand on what they can legally joke and about a twitter campaign using the slogan ‘this might be a joke’.
If you are a law nerd and you want to read the full judgment, you can find it here: http://www.judiciary.gov.uk/Resources/JCO/Documents/Judgments/chambers-v-dpp.pdf
If you are a only a bit of a nerd and you want to read my blow-by-blow summary of the law, it’s up on tVPN here: http://www.virtualpolicy.net/twitterjoketrial.html
But for the rest of you there are three bits of the case that got legally interesting:
Q: Is Twitter a public communications network?
A: Yes
While it’s a privately held company it relies on the internet and the public timeline is available to anyone that want’s to look at it. The fact that tweet (a message) later becomes ‘content also does not matter.
Q: Was the message menacing?
A: No
Here the High Court basically said – look, it was a joke. It looked like a joke, everyone knew it was a joke. Even the security staff at the airport when they did read it did not think it was a threat as they did absolutely nothing in respect of the security of the airport. What’s more it could not be considered a terrorist threat as terrorist don't issue bomb warnings as jokey twitters in the public timeline a week before, for everyone to see.
Q: Did the intention of the sender matter?
A: No and Yes
No – because as the message was not a menace one does not as a matter of law have to consider intent as it falls at the first hurdle. However there was an argument over whether, if it was a menace, the intention mattered. That is, if you write something and you mean it as a joke, but someone reads it as a threat have you committed a criminal act. In short the High Court said that in this case intent would matter as many things are said as jokes that someone might read as a threat but we can’t go criminalising that.
So what?
Well – phew. That's what.
If the conviction had been held there would be wide spread worry about what you can say on twitter. And if there’s worry about what you can say on twitter, they were be worry about Facebook, and then World of Warcraft and pretty much anything.
Sure the legal arguments would be different – is WoW or Facebook sufficiently closed to make it not a ‘public network’. Would a threat like ‘I’m going to shoot that Night Elf / Wookie / Imperial Guard in the face’ be sufficiently RP enough for it to look like a joke but not quite a joke, but still not literal etc etc.
Things may have got tricky out there.
So phew.
Now, as Shakespeare should have said “Let’s kill all the Alliance” (coz you know he would have been Horde and hard core RP), and spare a few of the lawyers eh :)
In the latest Social Change Technology podcast Dr Burcu Bakioglu talks to Andrea Phillips about Alternate Reality games, their design and some of the interesting legal and ethical issues that come up.
Those in the TN community that have been watching / making / playing ARGs for the last few years will be familiar with some of the issues - such as what if someone gets hurt, how far can a 'fiction' go before it is deception?
While some of the issues raised in the podcast are specific to games that have a very physical element and a fictional layer that sits over the everyday - still raise interesting questions about the ethics of game design and what responsibility the designer has for the players' actions.
You can listen to the podcast and see the full show notes on the Virtual Policy Network site.
Or by subscribing to Social Change Technology on iTunes or via our RSS feed.
The UK is considering a set of laws that give consumers rights over the providers of digital stuff. These new consumer rights will blow a hole through EULAs and side step a whole mess of intellectual property law. All UK consumers of ‘digital content’ would have these rights irrespective of where it’s provided from, the rights cannot be contracted out of, and the remedies apply to content providers where ever they are.
In short, if you are a game company based anywhere selling to the UK - you need to pay attention.
This is a consultation so none of it might happen. Actually that’s not true. The first option will happen as an EU law has been passed that gives consumers greater rights and this includes the digital domain.
This is a consultation so most of it might not happen. But if it does, this is what’s being proposed:
This is the big change. The proposal suggest that when a consumer gets a digital thing they should have a reasonable expectation of what that thing is. Just like any other good or service they would buy in the UK.
Seller has go to have the rights to sell it to you – so when Amazon removed Orwell’s 1984 from people’s kindles, that was their bad and the consumes should have got compensation
Is what it says it is – so if I buy something and THEN find out I need some specific player for it, that’s your bad not mine as you should have told me.
Uninterrupted use – so you know when Sony patched the PS/3 so you could not longer run Linux on it. Yeh, they can’t do that any more, as they sold a device that ran Linux and that’s what consumers paid for. The consultation does note that things change, and that’s fine, you just can’t suddenly remove valued features.
It’s basically gotta work – here things get tricky, but basically UK Gov are saying that there’s a reasonable expectation that, allowing for the usual bugs, digitial stuff has gotta be a certain quality
Paid for version is the same as the trial – ok, the trial might be limited but you can’t have a demo that’s substantially different from what people pay for.
And just in case you thought that some things might not full under this, the documents give all kinds of examples:
The rights against providers that customers may have are:
So, wow, the UK government are treating digital stuff just like other stuff. No EULA or IP trump cards. I'm sure there are a lot of happy consumers out there, but industry, how happy are you? Unreasonable burden on business? Have Koster's rights of the Avatar finally come to pass?
Note the full document is over 250 pages long, so for a very detailed analysis see the summary over at the Virtual Policy Network: http://www.virtualpolicy.net/ukcontentrights.html
tVPN is also putting together a civil society / academic response on Google Docs.
Your local trade association might be doing on too – see UKIE in the UK and ESA in the US.
The full consulation can be found here: http://www.bis.gov.uk/consultations/consultation-rationalising-modernising-consumer-law
Since 2007, by Game Industry Promotion Act and its implementing decree, S. Koreans should not do business for exchanging or mediating exchanges of, and repurchasing in-game money or data like in-game items that are produced or obtained by copying, adapting, and hacking the game program or by way of abnormal game-play.
The word of 'by way of abnormal game-play' has been generally understood as 'using Bots in game', and many sweatshop owners and RMT dealers who broke the law were punished.
On the other hand, Supreme Court of S. Korea ruled that RMT itself is not totally banned by this act in the sphere of MMORPGs where in-game items are basically obtained by sweat, not by luck. So, RMT dealers can buy and sell in-game items as far as those are produced and obtained by normal play.
In summary - human play : normal(OK) vs. Bot play : abnormal(banned).
But, practically, it's not that easy to tell Bot play from human play. Korean government have been worrying about the growth of the grey market of RMT and the crime related to this. Government agency assumes that 60% of RMT in korea were unhealthy one.
To cope with this matter, the Ministry of Culture, Sports and Tourism just now amended the implementing decree. Next july, the revised implementing decree will be effective. This time, Korean government enlarges the scope/depth of the word 'abnormal'.
Using the others personal information & Doing for a business also belong to the scope of 'abnormal'.
In summary - amateur play : normal vs. pro play : abnormal
(Probably the first 21th century law that is Johan Huizinga's Magic Circle graven on)
According to korean Value Added Tax act, anybody who supplies goods or services for business and earns more than 12,000,000 won in 6 months should register as "enterpreneur". Enterpreneur shall be liable to pay VAT. This new Implementing Decree do not permit game player be the enterpreneur of VAT act.
This is the end of my brief introduction to the new game law of S. Korea on RMT.
For me, it seems somewhat odd and interesting that Korea recently enacted another law called E-sports Promotion Act. The definition of E-sports is 'through the medium of games, human compete for the record, or win the game against human'. Of course, Main purpose of this act is to assist pro-gamer who play StarCraft, Dungeon & Fighter etc for a living.
Earning REAL money from the inferno be banned, while from the space is not.
Relating news(translated by google)
Former relating posts.
http://terranova.blogs.com/terra_nova/2006/11/korean_national.html
http://terranova.blogs.com/terra_nova/2007/05/s_koreas_bancan.html
You can’t get arrested for using BitCoin (yet) but you probably can for that pun.
To get to the point - I'm worried about BitCoin.
First, for those that have not been following the related tech and now politics news and can't be bothered reading www.bitcoin.org: what is BitCoin?Well, it is a non-fiat, non-centralised electronic currency. That is, BitCoin is not issued by any government; nor is it generated centrally by some other authority; and it does not have any physical manifestation. Technically BitCoins are digital files that sit in a distributed peer-to-peer database that use electronic signatures hence encryption as a fundamental to several aspects of their function. All BitCoin transfers are made public but the parties to the transfer are not. BitCoins can be bought (form those that have generated them) or self generated. Generation occurs through a process termed ‘mining’ which is getting ones computer to solve a hard mathematical problem, the problem is sufficiently difficult that there is an infinitesimal chance that ones computer will solve it at any one try, what’s more the difficulty changes with respect to number of factors such as time - there’s also an on-going process of creation, but let’s not get too into the details.
On the face of it BitCoin seems like other electronic currencies – such as WoW Gold. However there is a wide variety in electronic currencies and BitCoin is not quite like others.
So, BitCoin is like the kinds of virtual currency we are used to talking about on TN in at least a few relevant ways: it’s not backed by any asset or state, it’s electronic and its value is determined by the market (though this is increasingly true of most types of currency). Having said that, the kinds of currencies we talk about here are not as similar as one might think, here is a quick (non-exhaustive) run down of what is out there in currency land:
Fiat currencies - Those issued by states like China’s Renminbi, or the UK’s Stirling.
Hard Electronic Money - Electronic money systems where exchanges are non-reversible – these come in several types depending on what they are based on. Thus an e-currency virtual wallet on a mobile phone and BitCoin are hard electronic currency but the former has value in virtue of is representing fiat currency value, the latter’s has value do to the belief in the value of the currency in-and-of itself.
Soft Electronic money - Electronic money systems where exchanges are reversible, again there can be multiple types of Soft Electronic Money but the ones I’m aware of stand in for fiat currencies e.g. PayPal.
Closed economy game / social currency - A ‘currency’ that is limited by contract to only be used in a game. Technically these are not currencies but rather a limited license to use an element of a game or social network which themselves have no inherent value and there is no guarantee of access or redemption. Though, in practice, of course these are often used as tokens of exchange. An example of this is WoW gold.
Ingress-only game / social currency - An ingress (my term) currency is the same of a closed economy but the ‘currency’ can be. Note the property of no guarantee of access or redemption is retained even though a user may think they have purchased the right to access the ‘currency’ and trade it for electronic goods such as games or clothes. See Habbo Hotel, Xbox Points etc.
Exhalable economy game / social currency - This is a ‘currency’ that can be both bought and sold but does not legally retain value. For example, a Linden Dollar is traded as if it holds value but legally what is being traded are limited license to use elements of software that have no guarantee that they will exist over time and explicitly no inherent or redeemable value.
Semi-regulated game / social currency - This category is more about the state in which a currency persists rather than, in part, the currency itself. For example China and Korea have laws pertaining to in-game currencies that regulate their use – in the case of China this banned the use of QQ Coin for consumer to business transactions, in the case of Korea it enabled the sale of in-game currency between players.
Other - I’m not quite sure where EvE Online sits with the invention of PLEX (Pilot License Extension) as this is an in-game object that represents game time, which in turn has a direct financial value, so it’s kind of a in-game but ingress-by-proxy-feedback-something-currency.
So BitCoin is kinda like other currencies you might be aware of. One similarly that you will have spotted is that generated BitCoins is like bot-grinding i.e. you set your computer going at a mathematics quest and it has a chance of getting a loot drop but the probability changes based on certain game factors.
It’s the ‘kinda’ that worries me. As I hope my list above illustrated as soon as we move away from fiat currencies the exact different between one thing that looks like a currency and another gets rather complex.
My worry is the one I’ve had for some time, as all this virtual stuff starts to get more political and media attention the chances of staggeringly bad regulation and statute rises. Now, I’m all for regulation when it’s appropriate and regulation of virtual world / social media currencies may be a good thing – especially to protect consumers (ingress-only currencies already seem to be out of step with EU consumer law if you ask me). But the level of literacy about the complexities and social practices that surround things like virtual currencies is worryingly low. The Internet is a series of tubes remember.
So far we have a senator in the US, Charles Schumer, talking about BitCoin though largely in relation to allegations first made in Gawker about the use of BitCoin to purchase drugs on SilkRoad and suggests BitCoin is used for Money Laundering. LulzSec say they have received USD $7200 in BitCoin (http://twitter.com/#!/LulzSec/status/77771916794011648) which is sure to upset many.
If people like Schumer make moves for an outright ban of a class of currency it’s in everybody’s interest to carve out a space where virtual currencies can exist. One way might be for us to come to some agreement about how we would characterise virtual currencies as a matter of law – that is not argue over whether these things are property or not but provide a positive workable legal definition of what a virtual currency is that can be dragged and dropped into any putative legislation.
See tVPN’s work on virtual items and currency as a background doc: http://www.virtualpolicy.net/wp-virtual-items-public-policy
I'm thinking about a paper for a conference on ethics and games being set up by Harry Brown this October, and I'd like to kick out a concept (about which I know nothing, so it fits here) to see what your reaction is (if any): Maturity. I'm getting older and older, you see, and online shenanigans seem to be losing significance. Once thrilling, then annoying, now boring. What's happening?
Maybe it has nothing to do with age; maybe it's a stance with respect to goofing off that changes often according to circumstance, even if there is a general trend such that older people lose interest. What's your Sophomoric Stance? When Mia gave us all those neat examples about cheating, did you feel outrage, or titillation? Or maybe you just rolled your eyes and muttered, "Kids."
I feel this urge to challenge what seems to be a standard analysis of online transgression, in which transgression is either celebrated as significant revolution or vilified as significant crime. I'm not concerned about the revolution or crime part, but the significance.
When you play board games, you have to follow the rules. Otherwise people won't play with you. Playing by the rules requires a certain amount of maturity, especially since many rules are unwritten social rules, like, don't lick the dice. Hard when you're 3, easy when you're 48. (Pretty easy, anyway. For me. It's usually not a problem. Very few complaints.) Now if someone is not old enough to play the game, and breaks the rules accidentally or intentionally, well, that pretty much wrecks the game for everybody. But is it anything more than that? A moment of global trangressive significance? No - it's just someone is being a baby. It's annoying because, well, we could have had fun. But apparently not doing this particular thing, so, let's just go do something else. And that's it!What happens if we start treating rule-breaking in online environments as the acts of kids (of whatever age)? There's a big difference between handling kids and handling criminals. When kids are up to something, you just wave them off, put them in their place, and move on. The situation is definitely not loaded with ramifications. If you need to undertake common-sense moves to keep kids away from stuff they are likely to wreck, you don't agonize about it - it's better for you and for them to keep them out. I wonder if the "RP" moniker in MMOGs has less to do with RPing than with its role as a kid-filter. Do kids (again - kids of any age, "kids" = "people with a sophomoric stance that judges mooning as awesome") like to give their character stupid names that the RP filter catches? If so, that makes "RP server" into "adult server."
Do other authors use the term"maturity" when describing various pranks and persecutions and trollings in pseudonymous environments? Does maturity rise as one gets deeper and deeper into the social systems of persistent worlds? What happens when lots of online gamers are senior citizens? "When I was a kid, we only corpse-camped true idiots, but kids today, they just go off on anybody. It's a shame. Makes me wanna ragequit WoW, just like I did in 2006, 2009, 2013, 2021, and 2029...Oh, do ya remember the 2017 Night Elf model, wasn't she sweet..." [/face-plant into apple sauce]
Producers and users of virtual spaces are heading toward difficult times. These could be made worse through increased regulatory intervention by various countries. I suggest that it is in the best interest of users, produces and nation states alike that those online service providers that use virtual items and currency form self-regulatory body. I suggest further that sport provides a ready-made governance model that the online industry should adapt and adopt.
I thus propose the formation of an: Online Dispute Arbitration Board (ODAB)*
*An academic treatment of this was first presented at The Game Behind the Game by myself and Dr Melissa deZwart.
Individuals are investing time and money into virtual items but when things go wrong they are seemingly left with no rights and nowhere to turn other than the law. That is there are a number of circumstances where individuals lose access to virtual items or currency in a way they feel is unjust.
Courts and statue are increasingly recognising this position unjust and are finding in favour or users.
This has created a difficult situation where virtual items have a heterogeneous set of rights, which differ widely from jurisdiction to jurisdiction, associated with them. What’s more as the industry grows; cases become larger and more frequent; and, more property like attributes are associated with virtual items - heavy handed regulation that looks very much like real property and / or currency regulation will appear more attractive to lawmakers. This is especially the case as virtual itmes are no long restricted to MMO's or other online games.
Such regulation is likely to have a chilling effect on the industry especially innovation and thus will reduce the choices open to consumers. That is if the regulation is not written such that it inadvertently decimates one corner of the industry that fell outside of the model that law makes had in mind at the time of drafting.
Thus what is required is a system that can provide justice to the individual while not requiring a potentially problematic and inconsistent statutory definition of virtual items – a seemingly intractable problem.
The way to square the virtual item circle can be found in the regulation of sports.
There is something odd at the heart of many sports. However this oddness is so normal that we often forget that it is there. That is, in many sports people regularly do things that would be illegal in any other circumstance. In contact sports, say boxing, people hit each other with intent to hurt. In some cases people die through these encounters; however, just so long as the rules have been followed no one is arrested. Indeed the very thought of walking onto a sports field and arresting everyone for assault is ridiculous.
What sports law and sports governance do is provide a highly sophisticated normative influence on the conduct of sports and sports people. Governance is layered – there tends to be: in-game governance by officials, sometimes with replay facilities, club / league governance, national governing bodies, international sports federations and the international court of sport. The officials tend to ask ‘was act X within the rules’, layers above this tend to decide questions such as ‘was act X so outside the rules that other action is needed’ and ‘in judging act X where the rules applied properly’.
What’s more these structures do not preclude either the intervention of statutory bodies or appeal to such bodies. Hence if one player strikes another player the following layers might apply:
Official: Was it within the rules > no action
Official: Was it outside the rules and impacted play > in game sanction
Team / League: Was it far outside the rules > fine / suspension
Statue: Was it outside what could be reasonable expected / reasonable consented > criminal offence
Similarly if a player disagrees with a decision they may take it through the governances system on the basis the rules were miss-applied, similarly the may (and do) take legal action on grounds such as breach of contract – where a sporting body is seen as having a contractual duty to apply its own rules.
What is key in all of this is that there are a whole set of acts that are judged contextually. Thus in a game of physical contact it is only in the very extreme cases when the question ‘was that contact assault’ ever relevant – even though in any other circumstance it would be.
Hence the legal status of the act is purposely left under-determined, as a determination is not required for most normative purposes in the given context.
Both the philosophy and structure of sports regulation can be applied to virtual items.
There are not direct parallels for each layer of sports and online services but an approximation is as follows:
Match official < > Guild and / or GM
Team < > MMO Publisher
Sports Governing body < > Online Arbitration Body
The primary function of the arbitration body would operate by assessing incidents where an individual was denied access to virtual items in a way that they felt to be contrary to the sprit of the rules outlined by the service provider in question.
In the case of both games and non-game online services that utilised virtual items this would include incidents such as:
In the latter case the perpetrator may also face criminal proceedings the arbitration board though would operate in respect of the return of the items to the victim – something that may (or may not) fall outside the view of the criminal justice system.
Appeal to the arbitration board would typically be defined within the Terms and Conditions of the service provide but would only be applicable when the providers internal appeals system was exhausted.
Appeals may require a fee on behalf of users to cover, in part, administration costs and, in part, as a way to dissuading frivolous uses of the system.
The kinds of outcomes the board would determine would include:
Cheaper - Arbitration tends to be cheaper than law. Even when quasi-judicial bodies are established these tend to be less costly than legal actions. Further, the existence of an arbitration body does not preclude the option of legal action, as we see in sport.
Better - Assuming that ODAB can attract the right mix of individuals it should provide a better process than the courts, at least in the short term. This is because, as with sports, ODAB will have individuals that understand the details and culture of online games, hence will understand the issues at stake for all the actors.
Regulatory burden - A governing body that has normative power on players and publishers relieves the burden on states, at least in part, from enacting legislation and creating statutory bodies to deal with the issues that begin to arise in greater numbers from online games. This is particularly important as online games tend to be international and states tend to act first on a heterogeneous national basis and then take some years to come to forms of international consensus – all of which is time consuming and costly.
Regulatory peril - From a publisher’s perspective, an independent arbitration board may give states confidence that citizens will be sufficiently protected as customers of online games such that they do not need to pass the legislation and create statutory bodies noted above. The peril for publishers is that any such action runs the risk of having serious intended or unintended consequence on the industry as it is hard to pass laws that capture the nuance and dynamic of individual games. Here again the sports model is apt as states tend to regulate by law the rules of individual sports.
Insufficient volume – currently there is a low volume of disputes that are taken to court hence costs of any arbitration body are likely to outweigh any savings from the few disputes it might hear. As stated aboveI feel that the number of cases will increase but we concede that it is difficult to know when the best time to set up an arbitration body would be and that it may initially be financially inefficient.
It will be ‘griefed’ – almost all systems of online game norming are exploited by some players, the same will happen with an arbitration board with players simply wanting a cheap way to grief publishers. The scope of the arbitration board must be defined such to filter out griefing, for example a rule would be that publisher’s dispute systems are fully exhausted before the arbitration body is evoked, fees may be involved, cases may be publisied.
There is no publishers’ association – the online game industry has no recognised body hence it is unlikely that publishers will recognize the arbitration board. Initially the arbitration board will have to work directly with publishers and existing associations e.g. some publishers of online games are members of general publishing associations such as UKIP in the UK and ESA in the US. More broadly the lack of self-identification of online publishers is seen as a barrier to the creation of an arbitration body.
It is not peer based / lack of player representation – it is likely that the body will be made up of publishers only hence will be bias and fail due to lack of credibility. This is a challenge for the body especially as funding is likely to come from publishers. Thus the constitution of the body that publisher agreed to must ensure representation of players either through other bodies or non-publisher individuals.
Some form of arbitration system to resolve serious disputes about virtual items is the best mechanism for users, publishes and nation states as it provides a contextual, commensurate way of determining just remedies in an increasingly important aspect of many peoples lives without the necessity of legislators to try to understand and regulate an ever changing, complex set of online relationships centring on virtual items.
I’ve been trying to get as close to source as I can in the case of the ‘theft’ of virtual poker chips. According to a local news paper court report the chargers were in fact:
41 other offences were taken into consideration.
So, he was not charged with theft.
But, it is certainly the first time I’ve heard of ‘converting criminal property’ being applied in an English case relating to virtual items of this type.
The case is No. T20100391 at Exeter Crown Court should anyone have access to relevant listings, failing that I'll update when the summary is up on The Law Pages.
… 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?
Legal commentators in the blogosphere (e.g. Nic Suzor, Technollama, Rebecca Tushnet, Venkat & Eric) have already offered some initial thoughts on the Ninth Circuit decision in MDY v. Blizzard. Since I talked about the district court opinion in this case in Chapter 9 of my book, I thought I'd post a few reactions too.
This post is going to be a bit on the long side, but that's only because the issues raised on this appeal are a bit tricky, meaning that I feel the need to lay a little doctrinal groundwork before getting to my thoughts about the case.
Though there was an interesting tortious interference decision in the appeal, I'm going to focus on the two copyright issues that were decided by the Ninth Circuit, one involving a claim that users of MDY's Glider program breached World of Warcraft (WoW)'s software license and the other claiming that users of MDY's Glider program violated the Digital Millennium Copyright Act (DMCA)'s prohibitions on circumventing technological protection measures that limit access to copyrighted works. This second claim focused on the operation of Blizzard's Warden program, which monitors a player's computer to see if it is running any unauthorized software.
The appellate court essentially found in favor of MDY on the licensing issue, reversing the lower court, and in favor of Blizzard on the DMCA-Warden issue, affirming the lower court. That adds up to a win for Blizzard. That win could be reversed, in theory, if MDY pursues further appeals. An en banc review of the Ninth Circuit is possible and there's always the slim chance of getting the case reviewed by the United States Supreme Court.
I'll discuss the software licensing issue first.1) Does violating a ban on botting make a user a copyright infringer? When a user plays WoW, some of the game's software code is copied into the random access memory of the user's computer. This "RAM copying" is treated as an exercise of the copyright owner's exclusive reproduction right pursuant to existing Ninth Circuit doctrine.
Whether the RAM copy doctrine makes sense has been subject to some debate. However, if we accept that premise, it follows that playing WoW entails making a copy of the WoW software. If you are making a copy and you are not licensed to make that copy, you're presumptively infringing copyright. It is worth noting that section 117 might seem to carve out an exception for software purchasers making RAM copies that are part of normal software use, but again, the Ninth Circuit's precedent (affirmed in this case) leads to the conclusion that section 117 doesn't apply in standard consumer software purchases.
So starting at that point, if there is a term in the software license that you fail to abide by, and you make a RAM copy while breaking the terms of the license, are you then engaged in copyright infringement? E.g., I grant you a license to use my spreadsheet program, but include in the license the condition that you must stand on one foot while doing so. You agree to my software license and then, while using the spreadsheet, you lose your balance. When your foot touches the earth, have you committed copyright infringement?
Or perhaps did you merely breach an independent contract with me that is unrelated to copyright, meaning I can only sue for breach of contract?
The difference in the two sorts of claims can be very significant. Breaching a contract gives rise to traditional remedies -- i.e., how were you damaged when I stood on two feet and used the software? Infringing a copyright, on the other hand, gives rise to statutory damages, which generally don't track the actual damages that a copyright holder suffered as a result of the infringement. Statutory damages are a much more powerful remedy.
The Ninth Circuit in MDY draws a distinction between licensing terms that give rise to copyright infringement liability and those terms that fall outside the scope of the copyright entitlement. This makes abundant sense. Software copyrights should not give their owners the power to essentially regulate all user behaviors during software use with the threat of statutory damages for any breach of the terms of use.
To give rise to the infringement remedy, it makes sense that a licensing condition should have some "copyrightishness" about it. By analogy, this is sort of like the touch & concern doctrine in the law of property servitudes, which requires real covenants (persistent social arrangements regarding land use) to have some "landishness" about them if they are going to be applied to downstream purchasers of the estate.
The precise term at issue in MDY is Blizzard's prohibition on unauthorized "botting" software. Glider is a botting program, so it pretty clearly breaches Blizzard's license. Essentially, a bot program turns your avatar into a robot. Using Glider means that you are not playing World of Warcraft -- instead you're letting the bot program control your avatar on autopilot, setting it to run around Azeroth and kill things and collect loot.
If you use Glider, it is clear that you are in violation of the software license of WoW. And MDY essentially conceded on appeal that if users are copyright infringers when they use Glider in this way, MDY is liable based on that conclusion as an accessory to the underlying infringement.
But, as it turns out, according to the Ninth Circuit's ruling, using bots in violation of the WoW software license actually does not make a user a copyright infringer. Why not? Because there's no nexus to the copyright law in the license prohibition against bots.
It's a little hard for me to neatly sum up the reasoning here, but the basic point seems to be that "how you play the game" does not really have much to do with making copies of the game software or recording the content, etc.
As an outcome, I'm fine with this. Still, I must confess I'm a little hazy about the rule. Supporting the court's view, it is true that the claim being made by Blizzard is not that Glider users make copies of its software or experience WoW without paying subscription fees. If this were a traditional video game, I think those facts would strongly support the lack of a copyright nexus. But WoW is not a conventional video game and the copyright at issue is not a conventional copyright. In fact, with regard to the DMCA claim (which I'll get to next), the Ninth Circuit opinion accepts the idea that Blizzard owns a discrete copyright interest in WoW's "dynamic non-literal elements."
So Blizzard is not only claiming protection of the game's literal software code or the various multi-media components (audio files, graphics files, animation files). The copyright asserted in this case extends to the user's experience of the game software when connected to the servers (which are in turn connected to the clients of the thousands of other players). The work accessed is "dynamic" because it is constantly evolving and "non-literal" because it is a fluid multimedia audiovisual experience rather than a conventional fixed text. Note that these dynamic non-literal elements are produced, at least to some degree, by the players.
In fact, what is particularly irksome to Blizzard (and to its subscribers) about Glider is not that Glider players get access to the world, but that that they fail to access the world. The Glider user doesn't actually want the "dynamic non-literal elements" of Azeroth. The paradigmatic Glider user is not even experiencing WoW when Glider is active.
So why is Blizzard complaining about Glider users who pay MDY not to experience Azeroth? Because this case, I think, has always been about gold-farming. Blizzard sued Glider, I think, because the software is useful for gold-farming and gold-farming disrupts the game economy, poses virtual property headaches for the company, and is deemed cheating by a substantial portion of WoW's user base. If virtual gold is valuable and can be sold for profits, botting to collect it is a way to make money and Glider becomes a business tool.
But in the case, it seemed that neither side (for separate good reasons) stressed or deeply explored the connection between MDY's profits and the gold farming business. Given that the parties did not pursue it, the court certainly did not jump on it sua sponte.
Before moving on to the DMCA, I want to touch back on the condition/covenant distinction in the license. Is it really true that the prohibition on botting has no nexus to Blizzard's copyright? Actually, I might argue that it does. The manner in which the Glider player acts (or more accurately, fails to act) actually does shapes the nature of the "dynamic non-literal" elements that are experienced by the other players. The Glider player is, essentially, a bad authorial collaborator, making WoW worse for other subscribers.
Is that a copyright nexus? Certainly not a traditional nexus, but I do think an argument could be made.
Still, as I said, I'm generally pleased with the outcome here. Whatever the coherence of the court's explanation on these facts, the public is certainly better off in a world where every minor violation of a clickwrap license won't put you on the hook for copyright infringement.
2) DMCA 1201(a)(2)
Although the DMCA is another copyright claim, it is actually a much different claim involving a much different law.
The software licensing claim described above follows this logic:
1) Blizzard says no botting or you can't make RAM copies,
2) players who use Glider make RAM copies,
3) these players infringe copyright,
4) MDY is liable for helping them do that.
As I said above, the Ninth Circuit finds for MDY (and Glider users) by failing to agree with Blizzard at step 3.
The DMCA claim concerns Blizzard's effort to control bots via technology. Specifically, Blizzard created a program called Warden that monitors the active memory of the user's computer. Warden scans the user's computer for signs of unauthorized software. When the user connects to Blizzard's servers and the game is running, Warden pokes around in the game memory. If it finds signs of something it doesn't like, it severs the player's connection to the servers.
Blizzard's DMCA claim follows a simpler legal logic:
1) Blizzard's Warden program is a technological measure that controls access to the "dynamic" WoW program,
2) MDY's Glider program is a tool that circumvents Warden.
Essentially, that's the whole claim. This is because the DMCA, at 17 U.S.C. 1201(a)(2) concisely prohibits trafficking in tools that "circumvent a technological measure that effectively controls access to a work..."
Because Blizzard relies on Warden's policing activities for this claim, it had to take the position (mentioned above) that Blizzard holds a discrete copyright interest in WoW's dynamic non-literal game play elements. This is because Warden controls access to those dynamic elements, but doesn't effectively control access to the rest of the client software. E.g., the user has access to the audiovisual elements of the game and to the literal software code even when the client is not connected to the servers. The user only gets to see the game be dynamic, though, when the client ties into the server. This is when Warden does its police work.
So Blizzard's claim was that Warden is a technological measure that effectively controls access to WoW's dynamic non-literal work (the gameplay). The lower court accepted this claim. The Ninth Circuit accepted it as well, disagreeing with a Federal Circuit opinion that would have interpreted 1201 more narrowly, perhaps allowing MDY to prevail on this claim as well.
A large swath of the Ninth Circuit opinion is given to explaining what is fairly obvious if you read 17 U.S.C. 1201. Namely, section 1201(a) (at issue in this case) is directed at the circumvention of access-control measures whereas the separate provisions of 1201(b) outlaw trafficking in tools that enable the circumvention of rights protections. The court's descriptions of (a) and (b) are really quite nice, and I'll be sure to give them to my students in the future who get confused about the difference between 1201(a) and (b).
However, the Ninth Circuit uses the difference between 1201(a) and (b) to make a more radical, though not unprecedented, claim. Following what the Second Circuit did in the case of Universal Studios v. Corley, the Ninth Circuit determines that the 1201(a) "access" provisions are essentially a new right added to copyright law that are almost entirely separate from the traditional rights of copyright owners. Disagreeing with the Federal Circuit's decision in the Chamberlain (garage door opener) case, the Ninth Circuit rules that violations of 1201(a) can occur without the demonstration of any nexus (contra the discussion above re licensing) to copyright.
So, in essence, according to the court, it doesn't really matter that users are circumventing Warden with Glider solely to engage in a different sort of game play that is unrelated to copyright entitlements. The court itself stated that the botting prohibition lacks a copyright nexus. This doesn't help MDY evade 1201(a) we are essentially told, because that prohibition isn't about any that a user might do after evading Warden. The very act of evading Warden is the violation, even if subsequent actions have nothing to do with infringing copyright.
With that established, it is also established that MDY, by providing a tool that circumvents Warden, violates 1201(a)(2), even if the use of bots by users doesn't amount to copyright infringement.
Does that sound a bit odd? It certainly does to me.
Just like I disagreed with the Second Circuit when it decided Corley, I find myself in disagreement with the Ninth Circuit in this case. Whatever the legislative history of 1201 may say, it seems to me that 1201 is part of the copyright statute. Requiring that anti-circumvention violations bear some relation to copyright entitlements makes just as much sense here as it does with regard to the questions of software licensing. As many commentators have said over the past decade, treating 1201(a) as paracopyright entitlement essentially divorced from the logic of traditional copyright makes for both bad policy and bad copyright law.
Finally, I want to note that, for reasons that I explain in the book, I'm not unsympathetic to Blizzard's efforts with regard to prohibiting botting software. I'm actually okay, in this particular instance, with Blizzard winning this particular case.
My main concern is about the collateral consequences of this sort of DMCA decision. Copyright owners seeking to use the DMCA in this way are not all going to be like Blizzard going after botting programs. Few plaintiffs will be enforcing game rules with the general support of the user base.
Instead I predict that future cases that cite to this ruling will involve cloud computing companies and social network providers facing off against disruptive innovators -- and I'm pretty sure I'll be significantly less sympathetic to those efforts. Increasingly, the software we are running is going to be connected to remote servers and policed by programs like Warden that want to keep tabs on what we're doing with our iPads and smartphones, etc.
If you think about it, the ruling in this case is essentially about technology replacing law. Blizzard's contractual prohibition on bots has no copyright teeth. Its technological effort to prevent botting, however, obtain very pointy copyright teeth from 1201(a). Seems to me like an incentive for future cloud computing titans to build more comprehensive Wardens -- or even traitorware.
So there you have it. In sum, a mixed bag. (Lots of grays, a few greens, no purples.)
(Prior coverage here.)
I have just posted a (rough) draft of my latest paper, entitled Avatar Experimentation: Human Subjects Research in Virtual Worlds to SSRN. Virtual worlds make such great research testbeds precisely because people act in a lot of ways (especially economic ways) as if the virtual world were real. But that complicates ethical research design: you can't engage in activities that threaten the subject's digital property or community, for example. This raises human subjects research issues that a lot of Institutional Review Boards may not immediately take into consideration. Here's the abstract -- but the important part is that this is still a work-in-progress (it's coming out in a symposium issue of the U.C. Irvine Law Review next year), and I would love comments or suggestions. Abstract after the leap.
Abstract: Researchers love virtual worlds. They are drawn to virtual worlds because of the opportunity to study real populations and real behavior in shared simulated environments. The growing number of virtual worlds and population growth within such worlds has led to a sizeable increase in the number of human subjects experiments taking place in such worlds.
Virtual world users care deeply about their avatars, their virtual property, their privacy, their relationships, their community, and their accounts. People within virtual worlds act much as they would in the physical world, because the experience of the virtual world is "real" to them. The very characteristics that make virtual worlds attractive to researchers complicate ethical and lawful research design. The same principles govern research in virtual worlds as the physical world. However, the change in context can cause researchers to lose sight of the fact that virtual world research subjects may suffer very real harm to property, reputation, or community as the result of flawed experimental design. Virtual world research methodologies that fail to consider the validity of users’ experiences risk harm to research subjects. This article argues that researchers who put subjects’ interests in danger run the risk of violating basic human subjects research principles.
Although hundreds of articles and studies examine virtual worlds, none has addressed the interplay between the law and best practices of human subjects research in those worlds. This article fills that gap.
Virtual worlds are valuable research environments precisely because the relationships and responses of users are measurably real. The article concludes that human subjects researchers must protect the very real interests of virtual worlds inhabitants in their property, community, privacy, and reputation.
The article proceeds in five parts. After Part I introduces the scope of the piece, Part II explains virtual worlds and discusses why the marriage of social networking with three-dimensional videogame graphics complicates experimental design. Part III explores current and developing practices in virtual worlds research, as well as the various areas of law that bear on such research. Part IV outlines solutions and best practices for human subjects research in virtual worlds, and Part V offers a conclusion.
X-posted: Concurring Opinions
The School of Communication and Information at Rutgers is planning a major conference to be held April 8-9, 2011. The conference will cover the cultural, business, legal, and artistic aspects of the videogame and virtual worlds industries -- pretty much everything practical and academic about gaming. If you'd like to spend a couple of days conversing with other folks who think seriously about gamers and the video game industry, please consider submitting to the Call for Papers, which can be found here: http://bit.ly/gbgcall (Deadline for 500-word abstract = Dec. 15th.)
For more information about the conference see this link: http://bit.ly/gamebehindgame
More details about the sorts of topics we're looking to explore below the fold:
The conference will feature speakers, panels, and workshops based on abstract papers submitted before the event. The submission deadline for abstracts, panel proposals, and student posters is December 15, 2010, and registration opens January 2011. The conference will also feature a poster session and exhibits from industry-leading vendors. An award, covering travel and lodging expenses, will go to the authors of the best paper and best poster.A follow-up on Chris Ferguson's post regarding legal challenge to California's anti-game law: The Supreme Court heard oral arguments the other day. Here they are. Kotaku has a summary. We can of course rely on the court's tradition and gravitas to handle this matter properly.
Update 11/2/10:
So as promised, here's the book: http://bit.ly/virtualjustice
That link points to a 2.5 MB PDF that is licensed as Creative Commons Attribution Non-Commercial. I'm hoping to get a cleaner copy at some point soon--if I do, it will be posted at the same location. I got a MUCH better copy as of noon on 11/3/10 and it is now posted at the above link.
If you prefer wood pulp, this is the Amazon link: http://amzn.to/virtual-justice
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Oct 4, 2010:
So, apologies for the self-promotion, but my new book, Virtual Justice, is now on sale in the bookstores. It was also recently featured in a short segment of NPR's On The Media, which you can find here.
The book is subtitled "The New Laws of Online Worlds," and that's pretty much the topic. I start out with a pretty in-depth overview of the past and present of virtual worlds. I cover history, business models, the various genres, demographics, and technology. Then, around Chapter 4, I jump into the law, covering the law & legal theory surrounding issues like jurisdiction, gaming, property, computer hacking, and copyright.
It has always been the stories that have fascinated me about law and virtual worlds, so I tried to fit as many of the best ones as I could into the book. There's the Vendroid Scam, the Cally Eve Scam, the EQ dog dupe, Bragg, Qiu Chegwei, Mr. Bungle, Twixt, etc. But I use them all in support of the book's overarching theme: that virtual worlds offer private alternatives to standard legal ordering. I restate that theme in the conclusion as follows:
All of this suggests that virtual worlds are becoming, in essence, separate jurisdictions governed by separate rules. As a matter of legal doctrine, these rules may not qualify as “laws,” given that no territorial government has recognized the formal sovereignty of virtual worlds. But as a matter of effective legal practice, the doctrines of contract, property, hacking, and intellectual property all serve to greatly empower those who own and administer virtual worlds, effectively insulating their actions from legal review.
The metaphor I use for this point is the castle, which, although in essence a technology, effectively became a new jurisdiction and source of law during the Middle Ages.
I'm also happy to say that Yale University Press has agreed to let me release the text of the book under a Creative Commons BY-NC license. That means that (hopefully very soon) I will be able to post a link to the final PDF here so that anyone interested in saving a tree can (legally) download and share the book for free.
Finally, as I stated in the acknowledgement, I owe a profound debt of gratitude to the TN community for educating me over the past seven years about all aspects of virtual worlds. And with virtual worlds getting bigger every year, I think these issues will only be getting more interesting, so I'm looking forward to more conversations.
On Friday September 17th, a coalition of 82 scholars in the social sciences, medical sciences and media effects filed an amicus brief to the Supreme Court in the case of Schwarzenegger v EMA. This case refers to a California law which seeks to ban the sale of "violent" games to minors, effectively carving out new limitations to the First Amendment (no other form of "violent" entertainment is regulated by the government in such a way). The scholars' amicus brief specifically addresses the scientific merits of the case California puts forth and finds them without support in currently available data.
It is important to point out that the scholars' brief does not advocate that it is appropriate for young children to play mature-rated violent games. However any discussion of video game regulation must proceed from an honest understanding of the science of video game effects. Unfortunately the description of video game research presented by the state of California is lacking in this regard. Related to the issue of violence, there is little evidence to support belief that playing video games leads to violence. Most research on video game effects has been conducted on a broader category of "aggression" research, too often using unstandardized measures, the validity of which remains controversial. Experimental studies often use poorly matched video games (games that differ on more levels than only violent content) with playing times that are far too short (some intriguing new work suggests that because violent game controls tend to be more complex than for non-violent games, cutting players off just as they are learning the controls may be the source of frustration, rather than game content). Correlational studies too often use poorlyvalidated measures when better measures are available, and do not sufficiently control for third variables.
Several studies have recently coming forward addressing some of these concerns, using well-validated outcome measures such as the Child Behavior Checklist, and controlling well for "third" variables. These studies (even those by some scholars who do not like video games) find that well-controlled studies using well-validated outcome measures find little evidence for a relationship between violent video games and youth violence.
It is easy to blame politicians for misrepresenting the video game research. Unfortunately I think that the issue starts with the social science community which too often has made rather gradiose claims of causal certainty inappropriate to the available data. I speak only for myself here, but I sometimes wonder if my own discipline, psychology, is much at fault. Psychology has pushed hard to be taken seriously as a "real" science...perhaps we have pushed too hard, encouraging people to sound more certain than they should about human behavior. Admittedly saying "we think x might cause y sorta, just a little bit really, but we're not really sure" doesn't grab headlines.
Ultimately the Supreme Court case may rest far more on First Amendment issues rather than scientific ones. However I hope that the Supreme Court will consider the amicus brief seriously. Any discussion of video game effects must present an honest appraisal of the scholarly literature. Sadly, that has all to often been lacking in this field.
User thoreau (thanks!) notes this story about a man suing NCSoft over the hours he poured into Lineage II. The company argued that he abandoned his right to sue by signing the EULA. The Court disagreed.
What does it mean?
From Bryan Camp (thanks Bryan!) comes this notice of a legal ruling against an internet-based church. The ruling denies the group's status as a church, saying that it does not meet the standard of association because it does not hold regular meetings. The court decides instead that live-streamed sermons on the internet are primarily about information dissemination, not communion.
My church agrees: "Virtual reality is no substitute for the Real Presence of Christ in the Eucharist, the sacramental reality of the other sacraments, and shared worship in a flesh-and-blood human community. There are no sacraments on the Internet; and even the religious experiences possible there by the grace of God are insufficient apart from real-world interaction with other persons of faith."
Professor Camp wonders, what if the church was in Second Life?
What is association? What is communion? Does a virtual meeting accomplish one and not the other? Does the dimensionality of the space matter? Why does the body matter, especially when it comes to religion?
So, this is a video a woman made in which she deletes her boyfriend's World of Warcraft characters. It rather upsets him.
So, if he sued her, what would the legal arguments involve?
First the background: On 15 April 2010, the court of the Eastern District of Pennsylvania Philadelphia received an Action titled: “Carl Evans, Donald Spencer, Valerie Spencer, Cindy Carter, individuals, on Behalf of themselves and for the Benefit of all with the Common or General Interests, Any Persons Injured, and All Others Similarly Situated v. Linden Research, Inc., and Philip Rosedale"
In this case a specific is that the latest Terms of Service have a new clause in that states:
4.2 Second Life exists only as long as and in the form that we may provide the Service, and all aspects of the Service are subject to change or elimination.
Linden Lab has the right to change and/or eliminate any aspect(s), features or functionality of the Service as it sees fit at any time without notice, and Linden Lab makes no commitment, express or implied, to maintain or continue any aspect of the Service. You acknowledge that your use of the Service is subject to this risk and that you knowingly assume it and make your decisions to participate in the Service, contribute Content and spend your money accordingly.
(source: http://secondlife.com/corporate/tos.php, retrieved on 22 April 2010)
It appears to be suggested that in agreeing to these conditions there is a material change to a user’s property interests. Moreover it’s being noted that the change was made unilaterally by Linden and that users had to accept this if they wanted access to SL.
People might want to note TN’s previous coverage of the Bragg Case:4.3 All Data Is Temporary. When using the Service, you may accumulate treasure, experience points, equipment, or other value or status indicators and contribute to the environment ("Accumulated Status"). THIS DATA, AND ANY OTHER DATA RESIDING ON LINDEN'S SERVERS, MAY BE RESET AT ANY TIME FOR ANY OR NO REASON. ALL CHARACTER HISTORY AND DATA MAY BE ERASED IN WHICH CASE EACH CHARACTER MAY BE RESET TO NOVICE STATUS. YOU ACKNOWLEDGE THAT, NOTWITHSTANDING ANY COPYRIGHT OR OTHER RIGHTS YOU MAY HAVE WITH RESPECT TO ITEMS YOU CREATE USING THE SERVICE, ALL OF YOUR CONTENT AND ACCUMULATED STATUS HAS NO INTRINSIC CASH VALUE AND THAT LINDEN DOES NOT ENDORSE, AND EXPRESSLY DISCLAIMS (SUBJECT TO ANY UNDERLYING RIGHTS IN THE CONTENT), ANY VALUE, CASH OR OTHERWISE, ATTRIBUTED TO CONTENT OR ACCUMULATED STATUS.The above is from the 2003 ToS.The 2010 version reads:
4.3 [..]My point here is not that this is in the contract – but that everyone knows it’s in the contract. This is, it is a well known and well debated clause. The question with Second Life has always been – given that data can be deleted at any time what is the nature of the risk that you run by investing in it. And from a legal point of view – what entitlement do IP rights give you to digital artifacts. As far as I’m aware settled opinion on this latter point has been – none.
You agree that Linden Lab has and may exercise the right in its sole discretion to pre-screen, refuse, or delete any Content or services from the Service or disable any user's access to the Service without notice or liability to you or any other party, including upon our belief that such user's conduct, Content, services, or use of the Service is potentially illegal, threatening, or otherwise harmful to any user or other person or in violation of our Terms of Service, Community Standards, or other policies.
Look at the second comment posted about and hour after the announcement by our very own Unggi Yoon:
So, some people entered into a commercial contract that had a well known inherent risk. The contract has now changed though, in my view, the change has no material impact on the practical expression of property rights one has or business risk of using Second Life."Is'nt the revised section 5.3 of SL TOS faded by the section 4.3 of the same TOS?
------------------------------------------
4.3 All Data Is Temporary. […]”
About two weeks ago, I told Ren that I'd write up a post about the Stern v. Sony decision, which was issued early last month. This is a case where a federal court essentially answered the title question of this post. The answer, at least according to this particular court, is "no."
The plaintiff in the case, Alexander Stern, sought to bring a claim under the federal Americans with Disabilities Act (the ADA) against Sony Online. According to his Complaint, Stern is an individual with multiple learning disabilities that impair his visual processing abilities. His visual difficulties make it hard for him to get things done in SOE games. Stern claimed that the ADA required Sony Online to make reasonable accommodations to its software for players like him who have disabilities. Stern seemed to specifically want mods enabling additional visual and auditory cues, which he claimed that SOE failed to provide. (Michelle Hinn guest-blogged here about these sorts of mods back in 2007.)
The problem with Stern's claim was that the ADA section at issue applies only to public accomodations. Relying on past decisions in California courts interpreting the ADA, Judge Percy Anderson concluded that public accommodations under the ADA were either 1) physical places or 2) goods or services with significant connections to physical places. Because SOE games are not physical places or services connected to physical places, Judge Anderson concluded that the law did not apply to Stern's difficulties. As the court put it, Stern was merely seeking to "fully enjoy the video games." This was something the federal law did not entitle him to demand of the defendant. (Stern's state law claims under the Unruh Act were left unresolved by the decision.)
Judge Anderson's opinion was required by law in California, I think. In other states, Stern's claims may have had a little more traction. In Illinois and New York, for instance, federal courts have suggested that the ADA is not limited to physical structures and might apply to web sites that provide the same sorts of products and services that are provided in physical spaces. (Would virtual worlds fit into that category?) For some more details about the law, I can recommend a recent student Note by Joshua Newton, Virtually Enabled: How Title III of the Americans with Disabilities Act Might Be Applied to Online Virtual Worlds, 62 Fed. Comm. L.J. 183 (2010). You can find it here (PDF).
Broadly speaking, the Stern case and cases like it involve the recurring legal issue of cyberspace as place that Dan Hunter has written about in the past. As Dan explains, Internet law in the past fifteen years or so has regularly grappled with claims by plaintiffs seeking to apply "real space" laws to analogous online contexts. In some of my own writings, I've argued against the extension of certain place-based laws to the Internet. In the case of virtual worlds, however, Dan and I have argued that the extension of chattel property laws to virtual property can be theoretically justified.
The ADA is interesting in this regard. The ADA was enacted to combat discrimination against people with disabilities and to allow those with disabilities to participate more fully in society. It sought (and still seeks) to strike a balance between business owners and those with disabilities. If online spaces and social software, like Facebook and Second Life, are becoming new hubs of interaction and commerce, we would think the goals of the ADA should resonate in cyberspace as well. And if the ADA applies online, I would hope it might apply to game settings as well. Actually, in my forthcoming book, Virtual Justice, I've used an ADA case, Martin v. PGA Tour, to explore the sometimes problematic relationship between the rules of competitive games and the ADA's requirements. In that case, the Supreme Court decided that the golfer Casey Martin was entitled by the ADA to use a golf cart to ride between holes in the PGA Tour.
But if the ADA can be applied to some games, how necessary is it in today's MMORPG context? Newton's Note, above, concludes that the ADA really ought, as a matter of policy, to apply to virtual worlds, even if the current statute and doctrine do not extend that far. However, an editorial on AbleGamers, a website "dedicated to the disabled gamer," called the dismissal of Stern's suit good news. Apparently, the author, Mark Barlet, felt the suit would have a chilling effect on the existing level of cooperation between the disabled and developers in the game industry. The argument, I take it, is that the informal social networks are doing better than the law could do.
Perhaps, in the incredibly fluid context of networked entertainment software, avoiding the rigidity and expense of regulations and lawsuits might be the right call? I don't know. What do you think?
* This post is a correspondence to Ted's recent post 'SCOSK Legalized RMT'
Supreme Court of South Korea just interpreted game industry promotion act that I introduced in my old posting on Terra Nova: "Selective bombing of RMT in Korea" legaly literally.
By the law and its implementing decree, in-game money banned for trading should be gained either by luck or thru illegal/abnormal play. In this case, what the accused resellers bought and sold were Aden, a virtual currency created and circulated in Lineage(a famous Korean MMORPG since 1998, its EULA rules out RMT of Aden). And throughout the trial, there were no evidence shown to prove those resellers bought the money from Bot-using sweatshops or hackers.
Therefore, the critical point of the case was whether Aden is money of luck game to be banned or not. Public prosecutor asserted that attribute of Lineage is also a game of luck like a poker game, even though the former is less clear than the latter. 1st tier court judge found it guilty, but did not mention clearly about reasoning in the ruling.
The appellate court overruled the decision and explained that Lineage is game of sweat, not a game of luck, considering that it takes lots of time and effort to get Aden by hunting & Aden can be earned not only thru hunting but also thru PVP combat and P2P market in lineage world. So appellate court acquitted the resellers from the conviction for violation of game law. Finally, on Christmas eve last year, SCOSK confirmed appellate court's ruling.
I agree with Greg in that SCOSK's ruling itself does not mean total legalization of RMT. Definitely, The game industry promotion act in S. Korea selectively command to bomb the RMT of cyber cash of luck game and illegally/abnormally taken virtual money. Cause, the aim of game law is to protect 'Game' from 'Gambling'. Of course, it's not easy to detect and make a proof for selection. After the SCOSK's decision, korean authority announced its endeavor to ban abnormal RMT must go on.
Yes, right now, there's no change in this long gray colored clouds even in S. Korea and the EULA of NCsoft will (if the company want to) survive though somewhat depowered. But I think, some day, this decision opens the way of rainbow and new world to evolve into. In S. Korea, where the Second Life was serviced as RMT castrated and now withdrawn from, If SCOSK decided to the contrary, and extended the word of game law to Lineage-like virtual world, then, Grabbing with the dead bodies of RMT intermediaries, looking over dying Bots, Koreans will never imagine and meet in EVE online -like, Second Life -like, and There-like futuredoms.
Linden Lab has recently changed their policy about gambling in Second Life, effectively banning it (find a clutch of news reports here). The specific demands, in terms of policy and regulation, that gambling and other significant-stakes gaming make on virtual worlds have drawn my attention on TN before. Here I'd like to ask TN-at-large the following: What do you think the effects of this policy are likely to be on SL? On virtual worlds in general (if any)?
Ted's Synthetic Worlds Initiative at Indiana University convened the second Ludium Conference this past weekend in Bloomington. Attendees were charged with hammering out a well-considered platform to guide virtual world policy. We were successful, and the Declaration of Virtual World Policy [Edit: along with its wiki] has been posted by the conference's designers, Studio Cypher. Here it is for your perusal and comment (along with more details):
A Declaration of Virtual World Policy
made by
representatives of law, industry, and academia, assembled in full and
free convention as the first Synthetic Worlds Congress.
Whereas virtual worlds are places with untapped potential, providing new and positive experiences and effects, we resolve that:
-A self-governance group of virtual world stakeholders should be formed
-A players’ bill of rights should be drafted and should include the right of free speech and the rights to assemble and organize.[Edit: FN1]
-A universal age verification system should be created to support the individual rights of all users
-Virtual world designers should have freedom of expression
-Virtual worlds should include plain-language End-User
License Agreements (EULA) to enable all individuals to understand their
rights
-There are different types of virtual worlds with different policy implications
-Access is critical to virtual worlds, so net neutrality must be maintained
-Game developers shall not be liable for the actions taken by players
-Fair use may apply in virtual worlds that enable amateur creation of original works
-The government should provide a comprehensive package of funding for educational games research, development, and literacy
[Edit: FN1 Modified to reflect correct wording voted on at Ludium 2.]
SWI plans to send this platform to all major candidates for the presidency and for all contested congressional seats in the coming 2008 election. I'm sure these statements will prompt a lot of discussion and debate (I hope so), but I thought I would remind everyone that the congress is concluded, and these are SWI's policy recommendations, at least until the next Ludium ;-). I'm sure that registration for that one will be open, as it was for this one.
The Ludia are conferences structured as games, and this one was modeled
on a political convention, the first Synthetic Worlds Congress. Studio Cypher deserves a lot of credit for creating a game that generated incentives to both compete and collaborate. All attendees began in districts (of three delegates), and started by forging platform planks, combining them regionally (3 districts to a region, 3 regions total) by the end of the first day. On the second day, all voted in multiple straw polls on 30 potential planks, with merging of planks and refinement of language prompted by the game design, the end goal being a list of 10 planks, as determined by a final vote. The list above is the result. In addition, the conference elected me as its Speaker, which basically puts me forward to direct the traffic of media and policy-maker inquiries about the declaration to the appropriate legal, industry, and academic experts. In the process of determining the speaker as well there was a greater interest amongst the nominees (Corey Bridges of Multiverse, Joshua Fairfield of Indiana University Law School and TN, and myself) in focusing on the platform, and the breadth of expertise in the room that would be able to speak to its specific planks, then on the race for the position.
We all know that well-designed games are good at generating incentives for their players, and in a way I took it as a sign of the success of this one that before the first day was even completed many players were eager to concentrate on the content of the planks rather than press for every advantage that the game mechanics gave them to accumulate "influence points" or the currency, gold coins. It quickly became apparent that the Ludium had sparked useful ideas and discussion about virtual world policy. The feeling that we were succeeding in hammering out a useful set of policy guidelines only grew over the course of day 2.
The Ludium was also the setting for related news from Ren Reynolds, who took the opportunity after final voting was completed to let us know about the Virtual Policy Network he is spearheading, and organization based in the UK that will tackle similar policy matters from a European as well as global perspective. Bravo, Ren!
[Edit: Some Ludium2 reports from attendees have appeared. Christian Renaud of Cisco has a post here, and Mia Consalvo has a post here. Ron Meiners has blogged about it at Virtual Cultures, Garrison LeHearst weighs in here, and Michelle Senderhauf of ARGNet posted during the conference. Richard, of course, blogged about it here, and Peter Jenkins has a post on his blog as well. Any I've missed? Drop a comment below and I'll add the link!]
Many many legal happenings on virtual property and assets. First off, the judge in the Bragg v Linden case has dismissed Linden's Motion to Dismiss for Lack of Jurisdiction and Motion to Compel Arbitration. Lots to say about this Order, but I need some time to digest it. Also, a South Florida law firm has brought a consumer class action on behalf of US WoW subscribers against IGE for their gold farming activities. Much to be said here in a bit.
The highpoint of my brief reading to date is the opening paragraph of the Order in the Bragg case:
This case is about virtual property maintained on a virtual world on the Internet. Plaintiff, March Bragg, Esq., claims an ownership interest in such virtual property. Bragg contends that Defendants, the operators of the virtual world, unlawfully confiscated his virtual property and denied him access to their virtual world. Ultimately at issue in this case are the novel questions of what rights and obligations grow out of the relationship between the owner and creator of a virtual world and its resident-customers. While the property and the world where it is found are "virtual," the dispute is real.
At the State of Play/Terra Nova Symposium in New York last fall, Bryan Camp of Texas Tech School of Law gave us a primer on tax law as it relates to virtual worlds. I never knew that listening to a tax professor could be so illuminating and fun (really). Now he has written a paper giving a similarly engaging overview of the issues as they relate to SL and WoW.
And to think his elegant solution may be ruined by pizza...
The paper contains loads of useful information for us non-law types, in particular such helpful nuggets as the tax law distinction between imputed and gross income and how it may be the appropriate spot to draw the taxation line for virtual worlds. For Camp, it makes pragmatic sense to distinguish between activity within the worlds as, in a way, non-taxable diversions, and the taxable events that only happen when the "fourth wall" is broken. As he puts it (pp. 64-65),
The breakdown of the magic circle, the feared commodification of virtual worlds, can only come about when, like Pinocchio, the virtual becomes real. That will happen when economic activity in Second Life begins to displace economic activity outside Second Life. The most likely evidence of that will be when account owners gain the ability to trade Lindens for real goods and services that are useful outside Second Life, beyond the fourth wall, when you cannot tell the players from the audience...When online exchanges outside of Second Life -- such as Amazon.com or Staples.com -- start accepting payment in Lindens, that will mark the erasing of the magic circle. At that time Second Life will become a barter club and Linden Dollars will cease to be a unit of play and will become Trade Credits. Whether or when that time will come I have no idea.
Professor Camp, meet Pizza.net. If this press release is to be believed, that fourth wall may be broken very soon...by the pizza guy. Residents are apparently up in arms over SL's technical challenges, but who can argue with the appeal of a slice?
The online journal First Monday has just published their 7th special issue, Command Lines: The Emergence of Governance in Global Cyberspace, wherein you will find a number of articles by current and former Terra Novans, including Ted, Richard, T L Taylor, and me. (NB: the articles are appearing in three sets over three months; the complete list of them is at the link.)
The special issue (edited by Sandra Braman and me) grew out of the Command Lines conference at the University of Wisconsin-Milwaukee (sponsored by its Center for International Education), where we brought together a number of people interested in governance online. In many ways I saw it as a chance for scholars of virtual worlds to contribute their unique perspective to a broader conversation, and the conference was a tremendous success. Anyone interested in how to make sense of the moving target that is governance in and beyond virtual worlds is encouraged to dive in.
Sam Shahrani and Mario Gerosa have completed a Convention that would protect certain architectural elements of synthetic worlds. They write:
"We are pleased to announce the completion of a Convention for the Protection of Virtual Architectural Heritage. This document seeks to lay a foundation for the conservation of our 'virtual architecture', the environments and places that make up the synthetic worlds of video games. More commonly referred to as 'levels', 'maps' or 'worlds', these environments are the stage for players' experiences in video games. Unfortunately, little has been done to protect, catalogue and analyze these game spaces, but such conservation is necessary in order to provide reference material for study. The goal of the Convention is to provide a framework for this vital preservation work, and to encourage further academic study of the principles of level design and the architecture of synthetic worlds."
The Convention has already been published in Italy and may be found on the web here (pdf) and here (html).
The Canadian Red Cross wants game developers to stop using the Red Cross logo in games, claiming trademark infringement, trademark dilution, and playing the "support the troops" card by suggesting that use of a red cross in games removes the “protective value” of the mark in real war zones. No, I'm not making this up. I wish I were. The Vancouver Sun quotes David Pratt, the international issues director of the Canadian Red Cross:
"The fact that the Red Cross is ... used in videos which contain strong language and violence is also of concern to us in that they directly conflict with the basic humanitarian principles espoused by the Red Cross movement,''
Pratt said in a Jan. 31 letter to a Vancouver law firm that represents several Canadian game developers.
"The crux of the problem is that the misuse of the Red Cross in video games is not only in contravention of the law, it also encourages others to believe that the emblem of the Red Cross is `public property' and can be freely used by any organization or indeed for commercial purposes."
Now, let me stipulate for the record that the Red Cross/Crescent is just a peachy institution. Really, it ranks right up there with apple pie and my mum. But just as my mum has been wrong on occasion, the Red Cross is acting like a jackass here.
This is a bad, bad claim that the Red Cross is making here. It is wrongheaded, and stupid. Part of the problem is the demonization of games and the whole "Jack Thompson and Hilary Clinton and Every Other Politician vs The Games Industry" Punch-and-Judy show. In trademark law this issue gets played out as "tarnishment" and the implication here is that the Red Cross's mark is somehow tarnished by association with a violent videogames. Please. I could maybe buy this if you built a videogame that had Red Cross workers as spawn of Satan, going round killing innocent babies under color of helping them. But the mere use of a Red Cross symbol within the game? C'mon.
Beyond this there is a more pernicious problem that demonstrates a lot of what is wrong in intellectual property policy. The Red Cross seems to think that the symbol is its property (it isn't exactly, but leave that be for the moment) and the concept of private property demands the ability to exclude others from using your stuff without your permission. But the problem with strong claims of property here is this means that we have to remove this symbol from the common pool of expression. That is, if we recognize a property claim in this red cross, then the only way that I can, for example, have red crosses float over my character when I heal myself is by striking some deal with the property owner. The owner (ie the Red Cross) can stop me from using it otherwise. But how else, exactly, am I supposed to communicate graphically the concept of healing? What about the representation of a hospital within a MMOG? Sure, I could put "The Edward Castronova Memorial Hospital and Treatment Center for MMOG Addiction" on a generic building; but how much more expressive is this same building with a great big red cross on it? As my character races past this building, on his way to committing a foul murder or a random carjacking, I know that this is a representation of a hospital that may come in handy when the cops shoot me and I'm in need of some bandages.
This problem is an example of the way that the expansion of intellectual property claims restricts the ability of people to express themselves. If I wasn't goofing around with loopy blog posts like this one, I would be finished the book I'm allegedly working on that is exactly on this topic, and I could upload it for you to see more examples. I'll do that when I get a readable draft (in about ten years at the current rate).
In the meantime, someone contact the Red Cross and tell them that this is a daft idea. I tell you what, you can even infringe my intellectual property and copy this whole blog post in your letter to them.
[Tip o' the hat to Igniq]
TN reader and president of Blacklove Interactive Kelly Rued asks whether:
“player agency in an interactive sex game affects the media’s status as porn (legally and socially).”
I guess the argument might run like this: if two people having sex is it not pornography so is it porn if they happen to use avatars.
I would suggest that this should depend on who is viewing it. Certainly if there is a record of it, just as if there is a record of physical sex act, then this is a work and it it liable, based on its particular content, to fall under the category of pornography.
But what if there is no record and no one other than the two people involved ever see it – are they mutual and simultaneous creators / consumers of pornography, if so, why is this not the case in regular life; does the mere fact of mediation mean that there is a ‘work’ hence we have a legal category shift. In fact does the EULA comidification of data under the notion of ‘work’ force this shift?
All of which leads us to the broader question of whether categorizing it as pornography would serve a useful purpose, is this another law that needs re-evaluation in the light of virtual spaces?
Marvel, NCsoft and Crytpic have settled the "City of Heroes" lawsuit. As always the settlement is "amicable" and it clears the way for both parties "to develop and sell exciting and innovative products" and yada yada yada.
I guess this is hardly surprising, and no doubt in the parties' best interests. But law academics always feel a little let down when there is nothing to point to by way of a precedent or policy pronouncement. And this case was really significant because it exposed the faultlines of intellectual property protection in this space, and made a number of people recognize that there is a significant issue in the way that we express ourselves within MOGs/VWs.
But enough of my mewlings.
Hand me some more eggnog.
Summary over the fold and here is the press release.
Update: 7:54pm Story here by Daniel Terdiman, quoting all manner of notables, but none so notable as our very own G. Lastowka Esq. As Greg says: "... Marvel's claims of player infringement have not been formally rejected by the court, which means analogous claims might be pursued by Marvel, or a like-minded company, in the future."
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AUSTIN, Texas, December 12, 2005—Marvel Entertainment, Inc., NCsoft® Corporation, NC Interactive, Inc. and Cryptic Studios™, Inc. are pleased to announce today that they have amicably settled all claims brought by Marvel and all claims brought by NCsoft, NC Interactive, Inc. and Cryptic Studios, Inc.
The parties' settlement allows them all to continue to develop and sell exciting and innovative products, but does not reduce the players' ability to express their creativity in making and playing original and exciting characters. Therefore, no changes to City of Heroes® or City of Villains'™ character creation engine are part of the settlement. The parties have agreed that protecting intellectual property rights is critically important and each will continue aggressively to protect such rights in accordance with all applicable laws. While the terms of the settlement were not disclosed, all parties agree that this case was never about monetary issues and that the fans of their respective products and characters are the winners in this settlement.
Joshua de Larios-Heiman, who recently graduated from University of San Francisco School of Law, wrote a piece about virtual currency and some of the legal implications. It's called "Can Elvish Gold Pieces Ever Become Real Money? The Numismatic Qualities of Virtual Currency Under the Law". From the abstract:
"This essay addresses whether virtual currency, the medium of exchange used in the economies of massive multiplayer online games, can ever be imputed to be real money under American law. Part I defines the basic concepts surrounding virtual property and virtual currency. Part II focuses on the application of American commercial law to virtual currency, examines whether virtual currency should be construed by courts to be real money, and looks at pubic policy concerns of making such a determination. Part III examines virtual currency under existing Federal criminal law and focuses specifically on how the Money Laundering Control Act, 18 U.S.C.A. 1956, applies to virtual currency. Finally this essay summarizes the arguments presented and concludes that in specific situations, virtual currency should be imputed to be real money under the law. "
His advisor on this was cyber law professor Susan Freiwald who, I'm delighted to say, used to work in my department. (Indeed, I owe my job to her: had she not seen the light and moved to San Francisco I wouldn't be here). Oh, and prior to law school Josh had a career in securities where he created the world’s first financial superhero. You can read his comics here. The mind boggles.
Today must be my day for catching up on reading (which is about all I'm good for today, having spent waaaay too much time instance-raiding recently).
Anyway, I'm delighted to be able to recommend another essay, this time by Andy Schwarz and Robert Bullis. It's called Rivalrous Consumption and the Boundaries of Copyright Law: Intellectual Property Lessons from Online Games..
Don't let the title put you off (law review essays always have dull titles--it's mandatory). It's about the implications of the easy-to-understand-but-absolutely-vital economic concept of rivalrous and non-rivalrous consumption, ie when the use of a good by one person precludes / doesn't preclude use by another. This has emerged as one of the most significant basis for criticism of the current intellectual property system, but hasn't been sufficiently examined in MMOGs before.[fn1] The paper outlines some of the implications for viewing virtual assets as rivalrous or non-rivalrous goods.
It also has a section on antitrust (ie anti-competitive) implications of EULAs inter alia, which is sure to raise some eyebrows and put some noses out of joint.
The opening paragraph is over the fold, and defines the scope pretty well:
"When fantasy and reality collide, what laws should apply? Online fantasy games are spawning real-world markets in which players can trade cash for objects (such as swords with special powers) in the fantasy world. The objects only exist in the game world, typically on a server that is owned by a company such as Sony. Should Sony have the absolute authority to license the game and its objects without restriction? Or should the players, who invest time, effort, and skill into the game to 'obtain' the objects have the right to sell to other players for real dollars? This article addresses whether the fantasy sword is more akin to a book which under copyright law can be sequentially resold, or a digital song download which cannot. The authors suggest that the critical distinction between digital media that needs special protection and other digital items that do not, is the concept of rivalrous consumption (whether for copyright or antitrust issues). In essence, whether a given consumer can sell his or her sword and swing it too."
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fn1: Josh's great Virtual Property paper also looks at the issue of rivalrous consumption of virtual assets, but his take is different. He suggests that the rivarlous character of the resource will, together with the naturally layered nature of the internet will lead to overlapping rights of exclusion that will generate underuse of internet resources. The so-called "tragedy of the anticommons". Read that too if you haven't already. I'd re-read it now, but, honestly, I think I'm going to have a nap.
All video games are works of ideology. Often the ideology is so much akin to that of society in which they are developed and consumed that it goes un-noticed.
Games that surface an agenda stick out. A case in point is the new mobile game Airport Insecurity by Persuasive Games. Works that have government backing stick out still further. A couple of years ago America’s Army was the hot topic. So it should come as no surprise after the recent coverage of gaming in China that the Chinese government would want to get in on the act too. Step forward (or is that march forward) Chinese Hero Registry a Virtual World that the blogshpere suggests is planned to be developed by Shanda on behalf of the Chinese government.
Here is what Ching-Ching Ni of the Los Angeles Times says about the game:
“Instead of heavily armed superheros licensed to kill, the new game will highlight the likes of a model Communist soldier famous for helping other people. To advance in this game, players won't gun down their enemies. They'll mend socks, lots of them, and gain points by getting appreciation letters for doing good deeds such as helping old ladies home in a rainstorm and stopping people from spitting on the sidewalk. The prize is a signed virtual copy of Mao Tse-tung's Little Red Book. This soon-to-be-released video version of a vintage Communist scenario is part of an effort to clean up the Internet.”
The scope is also interesting
“While it will take as long as a decade to introduce the registry's entire slate of 100 heroes, the first batch of five starters will include historic figures such as the imperial eunuch many believe sailed to the New World seven decades before Columbus, a Ming dynasty general who defeated foreign aggressors, and an incorruptible judge”
OK, sounds dully, really really really dull. But then again Second Life sounds dull to most gamers. Thing is it also sounds virtuous, a game based on being nice to people – what could possibly be wrong with that?
read on, and on, and on, and
A case rattling around Florida and blogs that geeky-legally types hang out in concerns the right of an alleged drunk driver to have their legal team examine the code running the sample analyzer that the police use.
Jump cut to MMOs and a time where the whole virtual money / ‘real’ money distinction is long gone and we just see in-game transactions as transactions.
Now we’ve got all kinds of possible claim and counter claim resting on code. The service provider might disclaim away but what if I take out a civil action against someone for something or other and it comes does to whether something is or is not technically possible, so are legal teams say fine, lets settle this geek-2-geek, show us the code.
Well gosh
eeek.
Though I do see an interesting line in expert witness work here.
We should have been on this before, but for those who haven't heard the 8th Circuit upheld the district court's ruling that the defendants violated US copyright law and Blizzard's software licences and online terms of use. The decision is here.
More later. Under water here.