Addressing legal issues with the latest technological developments and social media trends.
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MP900439452.JPGFacebook has previously filed over 80 trademark applications on variations of its name and other terms such as “POKE”, “WALL” and “LIKE”.  Facebook now seems to be attempting to claim some level of ownership/protection over the word “book” as well.  In a recent revision to Facebook’s “Statement of Rights and Responsibilities,” which is the agreement all users must accept when accessing Facebook, language was inserted which states (emphasis added) “[y]ou will not use our copyrights or trademarks (including Facebook, the Facebook and F Logos, FB, Face, Poke, Book and Wall), or any confusingly similar marks, except as expressly permitted by our Brand Usage Guidelines or with our prior written permission.”

While there is no record of a current US trademark application on “BOOK”, Facebook does have a pending application in the European Union’s trademark database.  Moreover, Facebook has brought several suits against online sites incorporating the word “BOOK” in their domain name, with mixed results.  Several of these suits have settled while others are still pending.  Under US law a certain level of trademark protection can be gained merely by use of an unregistered mark.  Generally, such unregistered use is referred to as having “common law” trademark rights.  While these “common law” rights do not provide the same level of protection as a registered mark, they are still quite useful.  Moreover, including the above-referenced clause in its “Statement of Rights and Responsibilities” could provide Facebook with ammunition for future suits against any of its users who attempt to wrongfully use the “BOOK” mark.  Given that approximately 50% of all internet users have registered for Facebook, this provides Facebook with fairly wide-reaching (but not all-encompassing) protection.  
Historically, Facebook hasn’t shied away from protecting what is seems to consider its right in the term “BOOK”.  Only time will tell how Facebook plans to utilize any new rights it has gained from users by updating the “Statement of Rights and Responsibilities”.

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On March 21, the Entertainment Software Association filed a petition seeking a waiver from the Federal Communications Commission’s recently adopted rules that would impose certain disabilities act requirements on providers of advanced communications services (ACS) — which could include video games that allow voice or text communications during game play. The petition notes that while communications may be integrated into video games, it is not the primary purpose of the games, and therefore should be eligible as a class for waiver.  The waiver request included the following three classes of video game industry products and services: Game consoles and their peripherals; game distribution and online game services; and, game software.   (See our recent client alert: Telecom Monitor). ESA asked the FCC to rule on the petition within 90 days.

ACS includes interconnected VoIP, non-interconnected VoIP, electronic messaging service and interoperable video conferencing services, which are defined as:

  • Non-interconnected VoIP: a service that (i) enables real-time voice communications that originate from or terminate to the user’s location using Internet protocol or any successor protocol; and (ii) requires Internet protocol compatible customer premises equipment” and “does not include any service that is an interconnected VoIP service.
  • Electronic Messaging Service: “means a service that provides real-time or nearreal-time non-voice messages in text form between individuals over communications networks. This service does not include interactions that include only one individual (human to machine or machine to human communications).
  • Interoperable Video Conferencing Services: services that provide real-time video communications, including audio, between two or more users. This service does not include video mail. The Commission has sought additional comment, pursuant to the Further Notice of Proposed Rulemaking, regarding the definition and application of “interoperable”.
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A weekly wrap up of interesting news about virtual worlds, virtual goods and other social media.

 

The Virtual Military

While much of the international system remains mired in the economic doldrums, many global military powers continue to increase defense budgets focused upon the research and development of simulation technologies. As part of our week-long focus on the importance of games to international relations and security, today we consider how Russia,
China and the United States are using virtual simulators to train its armed forces.

Social game Idle Worship takes Facebook gaming to new level

Idle Games is launching a next-generation social game today dubbed Idle Worship. The title opens up a new genre on Facebook — the once popular “god game” — and it has an interesting and witty approach to social gameplay. Founded by former ad executive Jeffrey Hyman, San Francisco-based Idle Games is in a “holy war against games that suck or aren’t actually social.”

TrialPay and TubeMogul Introduce Real-Time Bidding for Virtual Currency and Social Video

TrialPay,
a leader in transactional advertising, and TubeMogul, a media buying platform for brand advertising, announced a partnership that brings real-time media buying to social video advertising for the first time today.

Illinois legislation to ban employers from asking for social network passwords hits snag

Legislation that would prohibit employers from seeking job applicants’ social network passwords is on hold in the Illinois House. Democratic Rep. La Shawn Ford’s measure would allow job-seekers to file lawsuits if asked for access to sites like Facebook. Bosses could still ask for usernames that would allow them to view public information on the sites.

 Smithsonian Art Of Video Games Exhibit Opens With Gaming Festival

The exhibit is curated by Chris Melissinos of Past Pixels, a group charged with the preservation of video game history. Over the past year, Melissinos — aided by a board of advisors that includes Double Fine’s Tim Schafer, text adventure veteran Steve Meretzky, and Penny Arcade team Jerry Holkins and Mike Krahulik — designed an exhibit that encourages visitors to make what Melissinos calls “a deeply personal decision” of whether video games are art. The exhibit offers five eras of video games with both playable demos and self-playing videos,
showcasing everything from the Atari 2600 to the PlayStation 3, from the traditional platforming of Super Mario Bros. to the more experimental play of Flower.

Navy Pursues a Better Attack Submarine Virtually

Technical advances in the field of virtual reality, also known as virtual worlds (VWs), are making it possible for the U.S Navy to tap into the collective expertise of its best submariners to design and build the next generation of attack submarines. At the Naval Undersea Warfare Center (NUWC) in Newport, Rhode Island, designers are able to create collaborative environments for submarine development using a fully immersive virtual reality application similar to the popular Second Life environment, which enables them to interact with one another both audibly and visually. Numerous participants at remote sites worldwide are linked to one another through the Defense Department’s secure computer network.

 

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On Monday March 19, 2012 a
bill was submitted to the U.S.
House of Representatives by Reps. Joe Baca
(D-Calif.) and Frank Wolf (R-Va.) which, if
passed, will require most video games to include a warning label that
states: “WARNING: Exposure to violent video games has been linked to
aggressive behavior.”

H.R. 4204, entitled “The Violence in Video Games Labeling
Act”, is a reaction to what its sponsors say is increasing evidence that
playing violent games can have a serious, long-lasting impact on children, which
should require a health warning to consumers. 
However, whether violence in video games promotes real world consequences has been a
contentious issue for decades.  Advocates of regulation of violent video games
attribute aggressive behavior to exposure to video games. However, proponents
of less video game regulation point to the studies that have shown video games
can improve cognitive skills.

The
proposed bill would require the Consumer Product Safety Commission to
release rules, within 180
days, requiring that most
games display the warning label. Included amount this would be all video games
rated by the Entertainment Software Ratings Board
“E” for everyone, “E10+” for everyone 10 and older, “T” for teen, “M” for
mature or “A” for adult.  Only video games rated “EC,” or “early childhood”, would be exempt
from the labeling requirement.

It is possible that this requirement of near-universal
labeling is an attempt to avoid the recent Supreme Court decision in Brown v.
EMA holding that video games are subject to First Amendment Protection and
finding that a California “violent” video game labeling requirement was “widely
underinclusive” and merely disfavored a certain viewpoint rather than protecting
a valid state interest.

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As a general rule, the name, image or likeness of a living person–not necessarily just a celebrity–cannot be used for commercial purpose without his/her written consent. Some jurisdictions have extended the coverage to provide additional protection to such elements as signature, voice, mannerisms or even expressions. Unauthorized use of an individual’s name, likeness or image may violate his/her right of publicity, which is currently recognized by statute, common law, or a combination of both in 31 states.1

However, as each state’s law evolved separately, there are often significant differences in the coverage provided. Specifically, New York and California, the key states for rights of publicity due to their many celebrity residents, protect different rights and are diametrically opposed on whether these rights extend beyond death.

In the past few years we have seen a paradigm shift in the
technology used to create video games. The current video game iterations allow for nearly photo-realistic imagery and, in some cases, use this
to allegedly depict real people in the games. However, not all of these
video games have entered into licensing arrangements with the parties
allegedly depicted. From this we have witnessed the commencement of a
new body of case law involving right of publicity claims against video
game makers. The video game companies have countered the claims by
alleging, among other things, that video games are creative works and
protected by the First Amendment.

To learn more about this emerging issue, please click HERE.

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A weekly wrap up of interesting news about virtual worlds, virtual goods and other social media.

 

Gaming is a top priority for mobile-tech makers

“Gaming is now a ‘need to have’ category, not a ‘nice to have’ category for mobile devices, whether they be tablets or phones,” said PJ McNealy, videogame analyst at Digital World Research. “The days of a single-function mobile device are long gone.”

PixyKids raises $3M for a social media platform just for kids

PixyKids has raised $3 million to develop its social platform for kids ages six to 12. It is built on the idea that kids want to socialize, even though they’re too young for Facebook. Kids can join PixyKids under their parents’ supervision and can share experiences and pictures the way that adults do on Facebook. The company is betting that social networks, not virtual worlds or education sites, will resonate most with kids.

FanCake Debuts as First Live Social Gaming Experience for Sports Watching

Kwarter, a mobile application factory building apps that lie at the intersection of the social, mobile and TV spaces,
announced today the launch of its first app, FanCake. FanCake turns live televised sporting events into interactive and social games, connecting millions of sports fans, teams, broadcasters, brands and athletes to enhance the game watching experience.

LVFH Launches Real Vegas Casino on Facebook

Las Vegas From Home.com Entertainment Inc. is pleased to announce the launch of its social casino product, Real Vegas Casino,
on Facebook to the general public. It is expected LVFH will launch more games under the Real Vegas Casino brand shortly, coinciding with a specialized marketing campaign.

 French City Implements Virtual Currency to Avoid Financial Ruin

The French city of Nantes has plans to introduce its own virtual currency as a complement to the euro. By 2013,
participating local businesses will be able to pay, or be paid in virtual currency units called “Nanto.”

Olympic stars brought to life in world’s first ‘augmented reality hotel’

From today, guests at the Holiday Inn London Kensington Forum will be able to use their smartphones or tablets to see athletes in virtual action in the reception, corridors and bedrooms. When the devices are pointed at specific sites in the hotel, the athletes will appear on the screen. BMX World Champion Shanaze Reade can be seen performing tricks on her bike in the lobby, while Paralympic table tennis world number one Will Bayley hits table tennis balls behind reception.  Meanwhile, UK long-jump record holder Chris Tomlinson can be seen to jump in a corridor. And leading windsurfer Dempsey will – somewhat bizarrely – do his thing in the hotel’s bedrooms using a bed sheet.

 

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On March 7, 2012, in our San Francisco office, Pillsbury hosted a discussion with prominent industry players from
Electronic Arts, Zynga, Lightspeed Venture Partners and KlickNation
(acquired by EA in 2011) to discuss all aspects of the process
surrounding video game company acquisitions. Topics included: how
deals are sourced in the video game space, how to decide whether or not
to sell, how to shop your company and how to negotiate deal value and
other key terms. Panelists came from both sides of the table to provide
insights as to how deals work from the perspective of the strategic
buyer and the founder/VC investor.

To read about the top takeaways from the event, visit Inside Mobile Apps.

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Back in January, we reported that the SEC released a National Examination Risk Alert addressing investment adviser use of social media.

Now, the SEC’s guidance could be particularly important given the “crowdfunding” legislation Congress is currently considering. Crowdfunding is a method of capital formation where groups of people
pool money, typically by use of very small individual contributions, in
order to support the organizers that seek to accomplish a specific goal.

The Senate currently is considering its own version of a crowdfunding
bill, the Democratizing Access to Capital Act of 2011 (S. 1791). S. 1791 provides for registration exemptions for certain crowdfunded securities if the aggregate amount raised through the issuance is $1 million or
less each year and each individual who invests in the security does not
invest more than $1,000. The Senate Committee on Banking, Housing and
Urban Affairs held hearings on December 1 and 14, 2011, regarding this
legislation, but a vote on the bill has not yet occurred.

For more information on this, please see Pillsbury’s recently released Client Alert.

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For some time, many industry insiders have anticipated that someday Zynga would launch its own game platform. That day has come. In press release today, Zynga announced:

the Zynga Platform, a new platform designed to bring players what
they’ve asked for: new ways to play and more people to play with. As
part of the initial roll out, Zynga will debut the beta release of
Zynga.com, the company’s new destination for social games. In addition
to serving up popular Zynga games, Zynga.com will let players discover
and play social games created by third party game developers. These
Platform partners will be able to reach new audiences and make their
games even more social.

“We built Zynga.com to give our players more ways to connect with
each other and play great social games whether built by Zynga or other
talented developers,” said Mark Pincus, founder and CEO, Zynga.
“Together with our platform partners, we look forward to bringing more
play to the world on our platform.”

This is sure to be a hot topic at GDC next week.

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Gametek has filed a complaint for patent infringement against a large number of game and game-related companies over a virtual goods payment patent. 

The patent issued based on an application originally filed September 29, 2000, and claims priority to a provisional application filed June 20, 2000. The patent issued July 11, 2006. We are happy to provide you a copy of the extensive prosecution history, but it is too large to provide a link here.

One of the independent claims recites as follows:

15. A method of managing the operation of a game which includes a game environment, and is programmed to control a gaming action of at least one of a plurality of users, said managing method using a programmed computer to effect the following steps: a) tracking the activity of the at least one user in the course of the gaming action; b) creating an account for the at least one user for maintaining a balance of the at least one user; c) enabling the at least one user to select at least one of a plurality of game objects; d) setting the purchase price of the at least one game object; e) comparing the account balance with the set price of the at least one game object and, determining if the user’s account balance is not less than the set price, then the at least one user is eligible to purchase the one selected game object; f) presenting to the at least one user an offer to purchase the game object dependent upon a group of game parameters comprising the tracked activity of the at least one user, and an indication of whether the at least one user has made a commitment of consideration to purchase the one selected game object; g) ordering the at least one selected game object without interrupting the gaming action of the at least one user; and h) supplying the selected one game object to the at least one user without interruption of the gaming action of the at least one user and incorporating the game object into the game.

The basis for the patent being granted is set forth in the Examiner’s reasons for allowance [Click here for a copy]. In part, the examiner refers to console-based games but noted that none of these “disclose offering a game object to a user for a price and allowing the user to access and incorporate said object in a game without interrupting the game.” The examiner also referred to other prior art and said “the instant invention is distinguished from the prior art…as the system tracks a user’s gaming actions…determines where a user is eligible to purchase a game object based on the user’s account balance…presents and offer to the user to purchase the game object based on …[the] tracked gaming action, [where] the user purchases and is supplied with the game object without interrupting the gaming action, and the object is incorporated into the game.”

Does anyone think that the use of player accounts to enable in-game purchases was new in 2000?

We have collected prior art that may impact the validity of this patent. We have been in touch with some companies and are reaching out to others regarding a potential joint defense group. Even companies who have not yet been sued may be interested in monitoring this case and/or helping to invalidate the patent.

We will provide additional postings here. Please check back.

If you have information to share or have additional questions, please contact us at: Virtual Goods Payment Team