Esports: Back to Basics by Carlton Fields

STEVEN BLICKENSDERFER NICHOLAS A. BROWN

BACK TO BASICS: A PRIMER ON INTELLECTUAL PROPERTY RIGHTS IN VIDEO GAMES

Table of Contents 2 3

Table of Contents

10 Getting Creative with Video Games:

Introduction to Back to Basics: A Primer on Intellectual Property Rights in Video Games

12 Getting Creative with Video Games:

DMCA Takedowns and You

Whose Game Is It, Anyway?

The Game of the Name: Choosing a Trademark for Your Video Game

14 Getting Creative With Video Games:

The Game of the Name: Making Sure Your Trademark Is Available

16 Frequently Asked Questions About

Getting Creative With Video Games: Copyright, Public Domain, and Fair Use

Sync Rights and Wrongs

Copyrights and Trademarks

Steve hosts the LAN Party Lawyers Podcast. Two lawyers tackle cutting-edge topics at the intersection of video games, law, and business. Through debate, discussion, and interviews, LAN Party Lawyers episodes explore issues facing everyone in the fast-paced gaming industry. No aimbots allowed.

The content of BACK TO BASICS: A Primer on Intellectual Property Rights in Video Games, is for informational purposes only and is not legal advice or opinion. BACK TO BASICS: A Primer on Intellectual Property Rights in Video Games does not create an attorney-client relationship with Carlton Fields or any of its lawyers. Copyright © 2020 Carlton Fields. All rights reserved. No part of this publication may be reproduced by any means, electronic or mechanical, including photocopying, imaging, facsimile transmission, recording, or through any information storage and retrieval system, without permission in writing from Carlton Fields.

2 | BACK TO BASICS: A Primer on Intellectual Property Rights in Video Games

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Introduction to Back to Basics: A Primer on Intellectual Property Rights in Video Games It is often said that the most important asset to any video game company is its “IP,” or intellectual property. The reason for this is not surprising. Intellectual property rights give their holders the ability to protect their work product from the unauthorized — and uncompensated — use by others, while at the same time providing valuable sources of revenue and branding opportunities. Unsurprisingly, the most common legal questions we encounter in the video game industry relate to intellectual property rights. Yet the intricacies of IP law are not intuitive and thus often leave people who do not practice in this area baffled, or worse, misinformed. In this series, we will discuss some of the fundamental concepts of intellectual property law as they relate specifically to video game companies and other unique players in the space, including esports teams and content creators. The intention of these articles is to provide a basic understanding of the various intellectual property rights important to the industry — from the differences between a trademark and a copyright, to what’s behind a DMCA takedown notice. These articles are not legal advice, nor should they be relied upon as such, as the particular facts of each unique circumstance determine how the legal issues will play out. If you have any questions concerning the content of any article, or want to know more about any of the topics we discuss, we encourage you to contact the authors. We promise, we don’t bite.

Author’s Note: This e-book has been compiled from an article series the authors published over the course of 2019.

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The Game of the Name: Choosing a Trademark for Your Video Game So you’ve just come up with a great new video game or concept. The idea is to get as many characters as possible to walk and chew gum at the same time. It’s the first game of its kind. Congratulations! You’re thinking of calling your new game “Walk ‘N Chew.” Why? Because it tells potential players what the game is about. Perfect, right? Wrong. As we explain below, that is exactly because it tells the potential player what your game is all about. The right trademark is nearly as important to your game’s success as the game itself. Trademarks identify your products and distinguish them from the products of others. Without a unique trademark, your target audience won’t be able to identify your game, and you might not be able to prevent your competition from using the same or similar trademark for their similar game. In that way, it’s just like your own name — it’s how people identify you. A trademark is a word, graphic, logo, picture, color, sound, or combination of those that distinguishes your product or service from those of your competitors. Service marks are like trademarks, but used for services, e.g., contests, competitions, competitive teams, game development. For this article, we’ll just use the term trademark to refer to them both. You use a trademark to make sure people can identify your game or your esports team and know where it came from or who sponsored it. Examples of game or game franchise trademarks: y Madden NFL y FIFA 19 y Anthem y Apex Legends Examples of service marks for esports or gaming: y EA Sports – video game publisher y App Store – online mobile retail store y Cignal Ultra – esports team Examples of service marks for esports conferences or promoters: y WCG

What Makes a Strong Trademark Now, the question is, how do you choose the perfect trademark? As noted above, your first impulse may be to choose one that describes exactly what the game does because it will tell potential players everything they need to know. But actually, the best trademarks are the ones that don’t describe your game. You want a trademark that’s “strong,” so you can better protect it from others using it, and because it will be less likely to be accused of infringing someone else’s trademark. The stronger the mark, the more likely it will be enforceable against others and the easier it will be to stop them from using the same or similar mark on the same or similar goods or services. The weaker the mark, the less protectable and enforceable it is, and the more difficult it is to stop subsequent users, raising the likelihood that it will be used by others in one form or another. Economically, strong marks cost less to protect and enforce than weak marks, and give a broader scope of protection. Strong marks are less likely to run into problems during the application/registration process and are more likely to be successfully enforced against a subsequent user of the same or similar mark, for the same or similar goods and services, or even related ones. Weak marks, on the other hand, can cost far more to protect and enforce, and provide only a narrow scope of protection. Weak marks almost always have problems during the application/registration process, making it harder to get them through to registration (resulting in greatly increased legal fees); they usually have to contend with marks already in use that, while perhaps not identical, have observable similarities. And weak marks are likely to be successfully enforced only against someone who later uses the same or substantially similar mark for the same or substantially similar goods and services. In terms of strength, there are basically four types of trademarks: fanciful, arbitrary, suggestive, and descriptive. Below we discuss each type, in order from strongest to weakest.

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Types of Trademarks

4. Descriptive Marks

1. Fanciful Marks

A word or design that describes or clearly identifies a quality or function or feature, or tells the customer what the product is or does, is called a “descriptive” mark:

Fanciful marks are madeup words. They have no meaning other than as a trademark for the owner’s particular goods or services. Fanciful marks tell you nothing about the product, but they are memorable precisely because they don’t:

y Microsoft – software company y ComputerLand – computer stores

y Spotify – digital music service

y Ticketmaster – online ticket sales

y Verizon – telecommunication services

y Paint – graphics software

y Rolex – watches

Descriptive marks are generally not protectable, precisely because they are descriptive. Descriptive marks can acquire protection by extensive use over a long period of time, or through extensive advertising or other continuous use. But that won’t be available for your new game any time soon.

y 2. Arbitrary Marks These are real words or images (logos) used for goods or services that have little or nothing to do with the definition of the word:

If the mark is deemed descriptive, anyone in the industry is free to use the mark in whole or in part, either in the name of their own similar product or as a descriptive term in text. While no one can stop you from using a descriptive mark, in turn, you can’t stop anyone else from using the same or similar mark. In fact, the term “descriptive trademark” is a misnomer, although it is frequently used.

y Apple – computers/phones/electronics y Bing – internet search engine y Chrome – web browser y Full Sail – educational services y Amazon – retail store As with fanciful marks, arbitrary marks tell you nothing about the product, but stand out as more memorable among the same type of goods or services of the competition. This is really the whole point of having a trademark. Arbitrary marks have strong protection, but unless they are “famous” marks, they generally don’t have quite the scope of enforceability as do fanciful marks.

Fanciful, arbitrary, and suggestive trademarks are protectable and enforceable proprietary rights. Descriptive marks, in the absence of extensive years of use and substantial proof of “secondary meaning,” are generally neither protectable nor enforceable.

Non-Trademarks: Generic Marks Unlike the prior four marks, generic marks are the product or service itself, and can never become a trademark:

3. Suggestive Marks Suggestive marks “suggest” something about the good or service; they give you a hint as to what it is or what it does, without going so far as to describe it. You probably have to think about it before you can figure out what the product or service is. Suggestive marks are usually existing words or combinations of words, or the equivalent graphic logos: y 7-Eleven – convenience stores

y Coffee y Furniture y Video Game Generic terms are neither protectable nor enforceable. They should be avoided if at all possible. So now that you know about the risks of using a descriptive term, you’ve decided to come up with a mark that has nothing to do with the game: YOWZA!!

y Netflix – on-demand video/movies/TV y Avengers – superheroes franchise y PayPal – online payment service

Good move! You’ve come up with a fanciful mark! Congratulations!

y StubHub – online resale ticket service Suggestive marks are generally enforceable only against the same or similar mark on the same or similar goods because they are only one step away from “descriptive” marks (explained below). In fact, the line between descriptive marks and suggestive marks is often very thin and subjective.

But wait — we’re not done yet. The next thing we should do is make sure your trademark isn’t already taken. 

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The Game of the Name: Making Sure Your Trademark Is Available The last time we met, you had just come up with a great new concept for a video game — to get as many characters as possible to walk and chew gum at the same time. After our discussion about the various types of trademarks, you picked “YOWZA!!” as the name. This is a great choice because it says absolutely nothing about the game, so it’s a strong mark. We’ll bet that your next impulse may be to start designing the logo and cover art, using the name in the game itself, and begin the marketing and advertising. After all, now that you’ve chosen a name, why wait? Can you move forward with using the name now? Yes. Should you? Probably not. The problem is, at this point, you don’t know if someone else is already using a mark that could cause you problems if you use or try to register YOWZA!! Ideally, you want to know that no one is going to get in the way of your using your trademark. Realistically, you at least want to know what, if any, risks you’ll encounter before you decide to use and register your mark. This is the point where you want to retain an experienced intellectual property attorney who specializes in trademarks. Your IP attorney will perform a trademark availability search, which is no simple Google search. It’s a sophisticated computerized search that goes through all the records of the U.S. and state trademark office databases, trade and industry journals, newswires and press releases, websites, and other databases, looking for any prior mark that could even remotely cause you trouble (and cost you a lot of time and money) down the line. Your IP attorney will review and analyze the search results and then advise you if there are any potential risks in using your trademark. Sometimes the search results show nothing to worry about (at least nothing that showed up in the search; remember the only things guaranteed in life — and trademark searches — are death and taxes). Other times they show prior uses that could pose some risk of objection — for example, you might receive a nasty letter from a prior user, but you could still have a chance of getting them to go away. Or you might find a prior application or registration that could cause issues with getting your application approved by the trademark office. But sometimes the results reveal prior uses that could cause you significant problems. In that event, you’re taking a real risk if you go ahead — including the risk of attorneys’ fees and litigation in your future, and possibly even losing your new trademark.

It is always better to know the risks beforehand. Once you know what’s out there, you can make an educated business decision whether to proceed with the mark. You might decide that, on balance, it would be better to come up with a new name rather than dealing with the baggage that your trademark search reveals.

Assessing the Risk of Proceeding With a Mark Performing a trademark search is not a prerequisite to using or registering your mark. You don’t have to do one. It just makes good business sense to find out if you might have some big problems down the road before you start putting significant time and money into production, advertising, and marketing. It’s a lot cheaper to change the mark before all that happens rather than afterward. Or, if you decide to go ahead knowing there’s a real risk out there, at least you know you’ll need to budget for some major legal fees (if you get sued), or if you decide to try to buy that pesky prior mark to get it out of your way. It all comes down to your own risk-benefit analysis based on your business judgment, informed by the advice of your IP attorney. What we can tell you, though, is that the upfront investment in doing a trademark availability search is more than worth it because it will help you to minimize the likelihood (or at least know in advance) that you will have to spend time and money later on extremely costly, stressful litigation to protect (or defend) your trademark. In this case, you picked a strong mark and your trademark search came back clean, your application was successful, you’ve started using your mark, and you’ve got your trademark registered. Congratulations! Now that you’ve secured your trademark, it’s time to talk about copyrights. 

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Getting Creative With Video Games: Copyright, Public Domain, and Fair Use Securing the trademark to your new video game project YOWZA!! is but one step among many in ensuring the maximum protection of intellectual property rights in your new video game. Next, you should consider protecting the game’s storyline, graphic characters, artwork, and music. This is achieved by ensuring that you own all the material in your game and getting a copyright registration (or two) to enable you to enforce it.

Copyright 101 Copyright law is anything but intuitive. To the contrary, it’s a brain twister, using terms that mean something other than what they seem to mean. We’re here to help you understand the basics so that you can both protect your game and respect the proprietary rights of others. When people refer to “copyright,” they are actually referring to a bundle of exclusive proprietary ownership rights in a work of art fixed in a tangible medium of expression. As relevant to the video game industry, a “work of art” includes audiovisual works; computer programs; literary works (e.g., the instructions, written script, etc.); artwork (all scenery, graphic characters, animation); and third-party prerecorded music. In general, copyright provides the owner with the exclusive right to reproduce, distribute copies of, display, perform the work, and create derivative works. This means that no one can use your game — or any copyrightable elements of it — in their game or for any other purpose without first getting your permission (by, for example, buying a copy and playing it in its intended manner). Copyright in your game YOWZA!! exists as soon as at least some of the creative expression of the game has been fixed in some tangible media — on paper, in software, on film, etc. Copyright in your game will extend to the story, graphic characters, artwork, original music, original code, the rules, as well as the entirety of the video game as a single copyright unit. What that means is that you can protect the entirety of the video game as well as the elements of the game, such as the individual graphic characters. As the game develops, the copyright only extends to what is already in existence. If you create the first half of the game on Monday, the copyright is in that half only, not in the second half. When you finish creating the game on Tuesday, you now have a copyright in the entire game.

This also means that owners of other works of art also own the copyrights in them, and they, too, are the only ones who can use their works unless they have granted permission for others to use it. Streamers who have been asked to take down a video game that has third-party music playing in the background may be all too familiar with this concept without knowing it. That’s because the third-party owner of the music also owns the copyright in it, and using it without permission violates the owner’s exclusive proprietary rights. Think of copyright as giving its owner the legal right to tell others what they can and cannot do with the work. An important point to remember is that copyright exists in your work of art, whether or not you register it. A copyright registration is merely a claim of copyright that already exists. However, registration of your copyright is required to be able to bring a lawsuit for copyright infringement. And if you have your registration prior to the start of the infringement, you’ll be eligible for certain additional benefits, including statutory damages and attorneys’ fees, which you can’t get if you register the copyright after the infringement starts. You don’t have to wait until the game is finished to register the copyright. At any point before the game is actually sold, you can obtain an “unpublished” registration. Once the game is commercially available, you can then obtain a “published” registration. Another important point is to be sure to own all the rights in your creative work. If you personally create all the elements of the game — the code, story, artwork, characters, rules, etc. — then you’re fine. Likewise, if you own or are a part of a company with actual employees to whom you pay salary, FICA, health benefits, or who are otherwise considered employees by the IRS (and only the employees create all the elements of the game), the company will own the copyright to the game. The trouble can start when you bring in outside developers, contractors, and artists to work on the game. We’ll cover more about that in a future article.

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How Do I Know If It’s Protected by Copyright? There’s so much great stuff on the internet — music, artwork, photos — to name just a few. Just as you created your game and have a copyright in it, someone else created that music, artwork, or photo and very likely has a copyright in it. The fact that a work you want to use is available on the internet doesn’t mean that it’s available for others to use. In all likelihood, someone owns it and it’s protected by copyright. Copyright material is typically identified with the copyright symbol: ©. There is no requirement, however, that the copyright owner use the symbol or put any identifying information on the work. And the lack of a copyright notice does not mean that the work is not protected by copyright. Remember, a copyright exists whether or not it’s registered. So how can you tell if it’s protected or not? Here’s a quick way to determine if a work has a valid copyright. If it was created 95 or more years ago, it’s no longer protected by copyright and is free for use by anyone. If it was created between January 1, 1925, and December 31, 1963, and (i) it was registered and (ii) its copyright registration was renewed (there was a renewal period back then), then it is under copyright for 95 years from the date of its creation. You can find out if the copyright registration was renewed by searching the records of the U.S. Copyright Office or, better yet, asking your experienced IP attorney to do that for you. If the work was created after January 1, 1964, then it is under copyright for 95 years from the date of its creation. If it was created on or after 1978 by an individual, then the copyright is valid for the lifetime of the individual plus 70 years, otherwise for a period of 95 years from publication or 120 years from creation, whichever comes first. But here’s where it gets tricky. Beethoven’s “Fifth Symphony” is long out of copyright, but a new London Philharmonic recording of it is under copyright. Jane Austen’s “Sense and Sensibility” is out of copyright, but the movie starring Colin Firth as Mr. Darcy is under copyright, as are recent new published versions that are edited and annotated. In other words, pretty much anything contemporary is covered by copyright and owned by someone, even if the subject matter itself may be out of copyright. If in doubt, assume that it is under copyright, especially if it’s something famous. Or check with your experienced IP attorney, who will know how to find the answer for you.

The Myth of the Public Domain A concept one hears often when discussing the use of copyright work is public domain. But what does it mean for something to be “in the public domain”? Probably not what you think. A work that is “in the public domain” is no longer protected under the Copyright Act, either because the copyright term expired, as discussed above, or because the owner specifically renounced the copyright (think UNIX, opensource software). At that point, it is available for anyone to use however they want. But as long as a work is still within the copyright term and the protection has not been renounced, it is the proprietary property of the owner of the work and protected under the Copyright Act. A work is not in the public domain simply because it is posted on Reddit or shared on Twitter, Instagram, etc. Unless the owner placed it there with express permission for others to use for any reason, you can assume that someone placed it there without the authority to do so. A perfect example can be found using Google images to look up “Deadpool.” You’ll see myriad posters and graphics of Ryan Reynolds in full Deadpool gear. Are they in the public domain because they are on Google? No. To the contrary, they are all copyrighted and owned by Twentieth Century Fox, which in turn is now owned by The Walt Disney Co. Of course, most of the images do not reference Twentieth Century Fox or Disney and, in fact, may even reference someone or something else. Google “picked” them off the internet through its search engine algorithms, without regard for any copyright disclaimers. The ease of access on the internet to characters, video clips, stills, and music from the likes of “Star Wars,” “Game of Thrones,” and Queen does not mean that any part of these works is in the public domain. Unless they are on the obvious owner’s website (Disney, HBO, Sony Music, etc.), you can assume that they are on the internet without authorization from the copyright owner. What does this mean for game developers and those playing the games? It means that most of the stuff that’s accessible on the internet (and that you probably want to use in your game) actually is under copyright and belongs to someone, is not in the public domain, and thus is not available for anyone else to use without permission.

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So no, you probably shouldn’t use the material you found online in your game, at least not if you want to avoid running a substantial — and potentially very expensive — risk of being sued for copyright infringement. Such a risk includes the copyright holder hindering you from being able to sell or use your game as long as you have the unauthorized copyright content in it.

It’s Really Not Fair Use

As the developer of YOWZA!!, copyright is one you want to get right because you obviously want to own, protect, and enforce your valuable proprietary IP rights. At the same time, you need to be careful not to inadvertently step on anyone else’s rights and wind up on the wrong side of a copyright infringement suit.

Another oft-misunderstood copyright topic is “fair use.” At first blush, one would think that fair use gives anyone the right to use another person’s copyright work as long as the person uses it in a “fair” way. Well, that’s partly true. But it’s not an affirmative right. It’s actually an affirmative defense, and this is a significant distinction.

As we said, copyright law, with its various ins and outs, is not intuitive. Terms such as “public domain” and “fair use” don’t necessarily mean what you’d think they should mean. Trying to determine if something is under copyright, to whom it belongs, and how to get a license to use it, can make one’s head spin.

Now that we’ve covered the basics of copyright, it’s time to dive into DMCA takedowns. 

Fair use is a very specific statutory defense to a claim of copyright infringement, and it only works after copyright infringement has been proven in litigation. It doesn’t give someone the right to use a copyright work with impunity. So, what is fair use? It’s the use of a copyright work, without the permission of its owner, only for the purpose of “criticism, comment, news reporting, teaching, scholarship, or research.” In other words, it’s the use of the work for something about the work: to critique a work, review it, report on it, teach it, use it in educational materials as part of course work or in a thesis, or use it in research (with quotes and credit references). There are a number of factors the courts consider in determining if there has been a fair use of a copyright work. These include things such as whether the use was for commercial purposes (a big factor that torpedoes most “fair use” arguments), how much of the copyright work was used, and the effect of the use on the value of the copyright work. Parody, entertainment, and transformative purposes have rarely been found to be fair use. Bottom line: Fair use is likely not going to be a good defense for a video game that incorporates someone else’s copyright work into the game.

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Getting Creative with Video Games: DMCA Takedowns and You In our last discussion, we covered the basics of copyright, including what rights are afforded in a copyright, what it means for a work to be in the public domain, and the concept of fair use. In addition to the usual prohibitions against unauthorized copyright use, the Digital Millennium Copyright Act (DMCA), a subsection of the Copyright Act, prohibits two additional actions that apply with some frequency to the video game industry, including the competitive esports scene and the intrepid content creators who stream their game sessions live and on-demand. First, the DMCA prohibits circumventing protected access (i.e., the anti-copying safeguards) to hardware, software, or firmware that contains copyright material. 17 U.S.C. § 1201(a) (1)(A). In this situation, it is the act of circumvention that is prohibited, regardless of whether the copyright material is obtained. Second, the DMCA prohibits the use of copyright material in which any copyright management information (CMI) has been removed, altered, or to which false CMI has been added. 17 U.S.C. § 1202. CMI is defined as: 1. The title and other information identifying the work, including the information set forth on a copyright notice. 2. The name of, and other identifying information about, the author of a work. 3. The name of, and other identifying information about, the copyright owner of the work, including the information set forth in a notice of copyright. 4. With the exception of public performances of works by radio and television broadcast stations, the name of, and other identifying information about, a performer whose performance is fixed in a work other than an audiovisual work. 5. With the exception of public performances of works by radio and television broadcast stations, in the case of an audiovisual work, the name of, and other identifying information about, a writer, performer, or director who is credited in the audiovisual work. 6. Terms and conditions for use of the work. 7. Identifying numbers or symbols referring to such information or links to such information. 17 U.S.C. § 1202(c). Going back to the Deadpool images on Google that we searched in our copyright article, you can see that in many, if not most, of the images, the CMI identifying Twentieth Century Fox as the copyright owner has been

removed. Those are likely violations of the DMCA. And if someone else (you?) uses those images knowing that the rightful CMI has been removed, or false CMI has replaced it, then that’s a DMCA violation as well. It is also important to understand that a DMCA violation is treated separately from copyright infringement. And remedies for DMCA violations are in addition to the remedies available for copyright infringement.

DMCA Takedown Notices Most individuals find out that the material they thought was in the public domain is actually protected by copyright when they receive a “takedown notice” from the website selling their game or streaming their content. All content hosts and providers — ISPs, search engines, and websites that host third-party content, such as YouTube and Twitch — are required by the Copyright Act to provide copyright owners with the ability to notify the content host that their copyright material is being used on their website without permission, and to request that the unauthorized use be taken down. 17 U.S.C. § 512. When it receives such a request, the content host must review it, but is not required to determine whether the copyright owner’s infringement claim is valid or whether the objected content is an actual copyright violation. If the content host determines that the request comes from a legitimate source, such as the copyright owner’s attorney, then the entire content containing the unauthorized copyright material will be taken off the content host’s site. A takedown notice is exactly what it sounds like. The copyright owner complained to the content host, and the content host took down your stuff and sent you a notice telling you when, what, and why your content was “taken down.” Because the copyright exists as soon as at least some of the creative expression of the work is fixed in a tangible medium (as we previously covered), the copyright owner does not need to register his or her copyright in order to issue a DMCA takedown notice.

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Think of a takedown notice as the first “shot across the bow.” Oftentimes it will be followed by a rather nasty letter from the copyright owner; sometimes it will be followed by a copyright infringement lawsuit. None of which you want or need. Receive too many takedown notices, and you run the risk of violating the terms and conditions of the content hosts’ services, resulting in an account suspension or termination.

How to Avoid a Takedown Notice As a general rule, if you didn’t create it yourself or have it created specifically for you, then assume that anything already in existence (and especially on the internet) is someone else’s copyright work. If it doesn’t have any identifying information, don’t assume it’s in the public domain (unless it’s obviously old — see our prior copyright article to find out “how old is old”). And fair use probably won’t save you either. As we previously discussed, fair use is an affirmative defense to copyright infringement, which a trier of fact (i.e., a judge or jury) would determine after a lawsuit is filed. In other words, relying on fair use is an expensive and time-consuming gamble. If you want to use someone else’s copyright material in your game, the very best thing to do is to get a license. Hopefully the material will have the proper identifying information so you know who the owner is. Common, obvious copyright owners — Disney, Fox, Warner Bros., etc. — all have standardized licensing programs. Music rights are a bit more problematic, since there’s no “one-stop shopping.” Sync licenses are actually a bundle of licenses from the owners of the copyrights in the lyrics, the music, and the recordings. The first two are usually the artist or the publisher, and the label generally owns the recordings. Big-name musical artists usually have management companies or their publishers handling the licensing rights to the songs themselves (but not the recordings); smaller artists may have their licensing info on their websites. In almost all cases, the record labels have the licensing rights for the actual recordings (but not for the music that is recorded). Sports figures are generally licensed through their respective leagues or their licensing agents. Celebrities can be contacted through their studios or management agencies (again, check their websites).

What to Do If You Receive a Takedown Notice Let’s say that despite your best efforts you received a takedown notice — what do you do then? If you used material that is not in the public domain and is protected by copyright, then that is likely infringement and there is little you can do other than immediately stop using that content anywhere, not just on the site that sent you the notice (even if it means taking it out of your game), and take steps to avoid receiving another notice going forward. If you doubt whether copyright protection exists (it likely does), or think you have a valid defense like fair use (you probably don’t), then you should seriously consider discussing the matter with an experienced IP attorney before moving forward. If you believe the takedown notice was issued in error, you can reply through what is referred to as a “counter notice.” Many content hosts like YouTube and Instagram have automated this process by mechanisms that allow recipients of takedown notices to respond to claimants electronically through their respective platforms. Because the counter notice will be sent to the claimant, and since takedown notices are usually the first step toward an infringement lawsuit, it’s advisable to consult an experienced IP attorney to determine if it’s in your best interest to file one and, if so, how to best word it to mitigate the risk that it would be used against you in future litigation. Another option is to have your experienced IP counsel communicate directly with the copyright holder. Your counsel will know better what to say and what not to say so that you don’t inadvertently put yourself at greater risk. Remember, contrary to the popular phrase, here it’s always better to ask permission than to beg forgiveness. And permission is always cheaper than being on the wrong side of a copyright infringement lawsuit. Next, we need to cover the basics about owning the copyrights and using contractors or employees to develop the work. 

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Getting Creative with Video Games: Whose Game Is It, Anyway? At this point, YOWZA!! — the video game in which you try to keep as many characters walking and chewing gum at the same time — is in production. We’ve got the software programmers, scriptwriters, graphic artists, digital effects crew, packaging designers, and rest of the team working away. And you’re paying them a lot of money to work that hard. But did you know that they may own what you’re paying them to create for you? That’s right — you may have paid for the creative work, but you might not own it. In order to “own” the video game YOWZA!! you need to own all the copyrights in it. As a multimedia work, a video game comprises lots of different, separately created and independently copyrightable elements — software, graphics, music, the script, and more. If they’re all your employees — i.e., they get benefits, health insurance, salaries (you take out FICA), profit sharing — then you don’t need to read any further, because you’re fine. The company owns all the rights to YOWZA!! But if any or all of your staff are not your employees — i.e., they’re independent contractors, consultants, get W-9 forms, get no benefits or health insurance or profit sharing — then you need to read on. This is an increasingly complex and important issue for game companies, as states such as California seek to change the law to effectively narrow the definition of independent contractor.

Copyright Ownership and Work for Hire As previously covered, copyright rights are created automatically as soon as a copyrightable work (software, graphics, music, the script) is “fixed in tangible form.” In general, ownership of the copyright in that work automatically belongs to the person who first created it. So the programmer owns the code, the graphic artist owns the graphics, the composer owns the music, and the scriptwriter owns the script. There are two exceptions, both under the rubric “work for hire,” which is perhaps one of the most misunderstood (and difficult to understand) provisions of the U.S. Copyright Act. A work for hire is a copyrightable work commissioned by one person to be created by another person that is deemed to be owned by the commissioning person (or company) under two very specific circumstances: 1. The person creating the work is an actual employee of the person or company claiming ownership of the copyright and the work was created during the scope of the employee’s employment. 2. The person creating the work (a) has a written agreement to produce the work; (b) the agreement specifically states it is a work for hire; and (c) the work is within one of nine very specific categories. If any of a, b, or c is missing, the work is not a work for hire, and the person creating the work owns it, not the commissioning party. Number 1 is easy and obvious, so we’ll just focus on number 2, which is neither easy nor intuitive.

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There are only nine specific categories for which work for hire applies: y Contribution to a collective work (i.e., collection of poems or short stories) y Part of a motion picture or other audiovisual work (series of related images with or without accompanying sounds) y Translation y Compilation (dictionary, collected works of prior published plays or stories) y Supplementary work (to comment on or explain a thirdparty work) y Instructional text y Test y Answer material for a test y Atlas

Here, the closest category that applies to video games is “other audiovisual work.” But that technically applies only to the “related images with or without sound,” and even that isn’t well defined. One thing we do know for certain is that work for hire does not apply to software programming, to individual graphics, to the script, or to music or sounds not integrated with the “motion picture or other audiovisual work.” So the question remains open as to whether software development for video games comes with the work-for-hire definition. The same goes for the contractor who designs the brilliant new logo for your game and the cover art. Assuming work for hire applies, remember that the agreement must be in writing, specify that it is a work for hire, and be signed by both parties. If any of these elements is missing, it is not going to be considered a work for hire, and all the rights in the work will remain with the third party. So how do you keep it straight? How do you know when to use work for hire, and what do you do if it isn’t a work for hire? Easy.

Get an Assignment and Get It in Writing There’s a much easier way to get the same result. Rather than taking any chances with work for hire, it is always better to err on the side of caution and simply require all third-party developers and contractors, regardless of what they are creating for you and whether it can be considered a work for hire, to assign all their copyright rights in the work to you. That assignment will cover anything that is work for hire as well as anything that isn’t. An assignment should be executed before the hiring of an independent contractor. If you already hired the independent contractor, no problem. You can still get one, and should do so now, before proceeding further with your game’s development. The assignment must also be in writing and should be notarized. Your experienced IP attorney can assist you in creating the appropriate copyright assignment documents. Before we end our discussion of copyright, we need to cover the various licenses that apply to music in video games and streams, including sync rights. 

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Getting Creative With Video Games: Sync Rights and Wrongs By now you’ve got a great concept for your new video game, YOWZA!!, cleared the rights to the trademark, filed an application in the U.S. Patent and Trademark Office, and obtained all necessary assignments from your independent contractors helping you put all facets of the game together. Fantastic. Now you want to add some great music and sound effects to the game. Or maybe you’re a streamer and you want to entertain your chat with your favorite tunes while you grind away. There are realistically only a few ways to do this legally.

Adding Music to Your Video Game While sources of copyright-free music do exist, you are better off assuming that the music you hear on the radio, in a video, being streamed through sites such as Spotify and SoundCloud, or through any other media you can possibly think of, has been copyrighted. Meaning it’s likely owned by someone, and you’ll need a license to use it in your game. Using someone else’s copyright music in your game without a license could end up costing you far more than just the cost of a license. This is not the time to act now and beg for forgiveness later. To add music to your video game, the first option is to create the music yourself. This is the path often taken by larger game companies that can afford to hire the requisite talent to compose an original score. Alternatively, you could get a license to synchronize someone else’s music to your game, i.e., a sync license. An option you do not have is to use someone else’s music or sound effects without obtaining the necessary permission first. If you do not have the funds or wherewithal to create music in-house, a sync license is the most attractive option. So how does one go about getting one? Actually, a “sync” license is a misnomer because syncing recorded music in a video game requires getting a couple of licenses from different sources. The type of music that you’ll want to use comprises a number of parts, each of which is separately copyrighted and owned — the musical composition, the lyrics, the combination of the music and lyrics, and the recording. The music and lyrics (or both together, depending on who wrote them) may be owned by the artist or the music publisher. The actual recording is almost always owned by the record label. Unlike performance rights and mechanical rights (used in movies or covers) — which are mostly licensed through single agencies like ASCAP, BMI, and the Harry Fox Agency — there is no equivalent source for licensing music. This means that you have to track down the individual copyright owners of the

music, lyrics, and recordings and get separate licenses from each of them, which can be a daunting task, especially for songs that are collaborations. Buying a CD or digital download of an artist’s album does not come with a sync license; it generally comes only with the right to play the music for your own personal enjoyment. A good place to start is the artist’s website. That will probably give you a lot of information about the music you’re interested in — who wrote it, who’s the publisher, the record label, the artist’s rights management company, etc. If the information is not readily available on the artist’s website, then you’ll probably have to do some internet searching, send some emails, and make some calls. Better yet, this is a good time to get an experienced IP attorney involved who can not only locate the copyright owners, but also negotiate the licenses for you. Two birds with one stone. So how much will all this cost? Well, that’s mostly going to depend on the artist and how famous he or she is. The more famous the artist, the higher the fees. A lot of licensing is handled on a percentage royalty basis, which bases the payment of fees on a percentage of sales. Other licenses might require upfront payments and minimum annual royalties. It all depends on the rights owner(s) and the context. While all this sounds intimidating and overly complicated, it really isn’t. You just have to know what you want, where to find out who owns it, and who to contact to get the licenses.

Adding Music to Your Stream The same restrictions on adding music into a video game apply to streaming the game online, whether on Twitch, YouTube, Mixer, Caffeine, or your own platform. As discussed in a prior article, relying on “fair use” is not advisable as that is an affirmative defense to infringement, not a right to use someone else’s copyright work in your stream. If you fail to obtain the appropriate permission before streaming, the repercussions can be severe. As discussed in a previous article, you could be subject to a copyright infringement lawsuit (at worst), or, more likely, you could receive a DMCA takedown request, resulting in the removal of

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your stream or video from the platform. And if you receive too many takedown requests, you could receive a temporary or permanent ban from the platform. The platforms’ terms of service should give you a better understanding of each platform’s stance on copyright infringement and takedowns. Fortunately, there are places one can get copyright-free music or sync licenses from single sources. Some platforms, such as Twitch, even offer a music library that is represented as being safe for use while broadcasting on the platform. Check to see if your platform offers this or a similar service, until you can obtain appropriate permissions for other music of your choice. Beware, however, that if the library is not actively maintained, you may still be at risk that the licenses are no longer valid. It is likely we will see increased options for streamers in the not-so-distant future as streaming becomes more commonplace and relied upon by the industry to market and sell games.

At bottom, make sure you take appropriate steps to make sure you have permission from the applicable rights holders before including someone else’s music in your game or your stream. This is certainly a situation in which some upfront time and care can save you a great deal of resources on the back end. Getting permission ahead of time provides you valuable certainty, not to mention comfort that later you won’t be the subject of any (valid) challenges, lawsuits, or takedown notices. 

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Frequently Asked Questions About Copyrights and Trademarks There are no stupid questions about intellectual property when you’re developing a new video game (or any other product or service for that matter). The only trick is knowing whom to ask to get the right answer. Whatever IP questions you have, trust us, they’ve all been asked and answered, time and time again, starting when the inventor of the wheel went to his IP attorney’s cave. What follows is a collection of answers to some of the most frequently asked questions we have been asked.

Public Domain and Internet Content What is the “public domain”? The “public domain” is a legal construct that consists of creative works that have no enforceable intellectual property rights. A work is considered “in the public domain” when it has lost all proprietary rights that it ever had under applicable intellectual property law. For example, the copyright or patent term expired, the trademark was abandoned or became a generic term, the owner waived or forfeited all its rights, or there is no applicable intellectual property protection available for it. Because intellectual property laws vary on a country-by-country basis, a work that is in the public domain in the U.K. might be fully covered by copyright in the United States. If I find a graphic or photo, or music on the internet, does that mean it’s in the public domain? No. The internet is not the public domain. That all sorts of works are readily available on the internet is a result of technology and user abuse. That cute image of Baby Yoda looking up with his large dark eyes from Disney’s “The Mandalorian” is not in the public domain simply because someone copied it from a legitimate source and then posted it on their social media page and someone copied it from there onto their own site. The fact that you can hyperlink to a clip of a movie soundtrack from your friend’s Instagram page only means that someone created the hyperlink. It does not mean that the hyperlink is authorized or that snippet of the soundtrack is in the public domain. OK, but what about stuff that doesn’t have any copyright notice or other way to identify if anyone owns it? Can I use that? Again, sorry, no. First of all, there’s no requirement that a work have copyright notice, so that doesn’t help. Secondly, you don’t know if whoever posted that image took any info off of it. If they did, that’s multiple violations of the U.S. Copyright Act and, if you use that image, you’ll also be in violation. You shouldn’t assume that because the work you’re looking at or listening to has no identifying information that it’s “public domain.” You don’t know where that particular image or clip

came from, who made it, where they got it, or what it looked like originally. So, if you find a graphic, a picture, a cartoon, a sound or movie clip, a photo, etc., on the internet that you really want to use, the best thing is to try to track down the owner and ask for consent or a license. So what happens if I decide to use the stuff I find on the internet anyway? If you’re lucky, nothing. But more realistically, you put yourself at risk of being subjected to a DMCA takedown or, worse, sued for copyright infringement for as long as you use the work — and even after. That you didn’t know it belonged to someone or that you thought it was in the public domain is only a defense to a claim of infringement, and not a very good one at that. Copyright infringement legal fees can run into the hundreds of thousands, if not millions, of dollars. And you could be liable for an awful lot of monetary damages as well, perhaps even the other side’s attorneys’ fees. Getting a license is cheaper than the cost of defending an infringement suit. Trust us.

Copyright What is a copyright? A copyright is actually a bundle of exclusive proprietary ownership rights in a “work of art” — literary (books, stories, poems, news articles, software code), graphics (photographs, paintings, drawings, architectural plans), movies, audiovisual material (websites, video games), choreography, music, sound recordings, and the like. Copyright protects the creative expression of the author, but not the idea or concept underlying it. For example, Dungeons & Dragons is a specific creative expression of the concept of a medieval fantasy role-playing game. Wizards of the Coast owns the copyright in the Dungeons & Dragons game, but has no proprietary rights to the idea or concept of medieval fantasy role-playing games (such as The Witcher, Dragon Age, Dungeon Siege). What are the “bundle of rights” in a copyright? The copyright “bundle of rights” gives the owner the exclusive right to reproduce, create derivative works, distribute, display, and perform the work of art.

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How do I get a copyright for my game? Copyright in your game starts to develop as soon as at least some of the creative expression of the game has been fixed in some tangible media — on paper, in software, on film, etc. As you create more and more copyrightable elements of the game, copyright will exist in those as well. But the copyright only extends to what is already in existence. If you create the first half of the game on Monday, the copyright is in that half only, not in the second half. When you finish creating the game on Tuesday, you now have a copyright in the entire game. What does my copyright do for me? Having a copyright enables you to prevent others from copying your game or any parts of it that are covered by the copyright. How many copyrights do I have in my game?

Can I get a copyright registration for the game and for individual graphic characters, other graphics, music, or other elements of the game? Yes. You can obtain a registration for any individually copyrightable elements of the game as well as for the game itself. Can I claim the copyright in the entire game if I’m using licensed technology or licensed content? No. The copyright registration form has a place where you indicate that the material you are registering contains preexisting material. This is a good time to call your IP attorney to make sure this gets done properly and you don’t end up getting a copyright registration for someone else’s work. Should I wait until someone steals my stuff to register my copyright?

This is where we distinguish between claims of copyright ownership and registration of those claims. You always own the copyright in the entirety of the game (assuming it is all original with you). And if you break it down into its constituent copyrightable elements, then you also own the copyright in each of those — software, graphic characters, storyline, graphics, music, text, etc. You just can’t enforce those copyright claims until you obtain registrations for them from the U.S. Copyright Office.

No, for a few reasons. When you obtain a copyright registration before someone infringes the game, you can get actual damages or elect to receive statutory damages, and you would be eligible for discretionary attorneys’ fees if you win. If you don’t get your registration until after the infringement begins, you can only get actual damages, and attorneys’ fees are not available even if you win.

Do I have to register my copyright?

What is a trademark?

Although you have a copyright automatically in the game, you can’t enforce it against an infringer unless and until you register the copyright with the U.S. Copyright Office and actually obtain a copyright registration. Owning a copyright registration certificate is a prerequisite to filing a copyright infringement suit in the United States.

A trademark is a source identifier — it is the unique “name” you give your game that enables gamers to identify the game as having come from you. It is usually made up of words or designs, or both. It lets purchasers distinguish between your game and those of your competitors. StarCraft, Super Mario Bros., and Dragon Age are examples of trademarks for video games.

Do I have to wait until my game is completely finished to register my copyright? No, not at all. You can obtain “unpublished” copyright registrations for any one or more of the development versions of the game that you want. Then when the final version of the game is ready for commercial production, you’d file for a “published” registration as soon as it is publicly sold or distributed. Think of it as software versions — a software developer can obtain individual copyright registrations for each version of the same software.

Trademark

How do I get a trademark for my game? Choose it, then use it. First, you have to decide what mark you want to use. Then you want to make sure the mark is available for your intended use and that no one else is using or has registered the same or similar mark. Then you have to use it commercially.

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How do I know if the mark I want to use is available?

Do I have to register my trademark at all?

This is another point at which you want to call your IP attorney. Your IP attorney will do a U.S. trademark availability search to review the federal and 50-state trademark databases, numerous websites, domain names, company names, and unregistered uses to determine if there are any prior uses, applications, or registrations of the same or similar mark that would pose any risk to your proposed use and registration of your mark.

No, but it’s a very good idea to do so. A trademark that is used but not registered is called a “common law” trademark. A common law trademark is generally protectable and enforceable only when it is actually used. So just using a mark can severely limit the type of protection available in the event someone infringes it, while registration greatly expands the scope and nature of available protection. A trademark that is used on goods sold only within a state qualifies for a trademark registration in that state, which protects the mark throughout the state (but not beyond). A trademark that is used in interstate commerce (between two or more states or between the United States and a foreign country) qualifies for a federal registration, which protects the mark throughout the United States and its territories. A U.S. registration is only good in the United States. If you want to protect your trademark in other countries, you’ll need to obtain registrations in those countries.

Is it my trademark if I plan to use it but I’m not using it now? No. In the United States, trademark rights arise only on actual commercial use of the mark on a product (or service). Just coming up with the idea for a great trademark won’t protect it. I thought of a great trademark for my game or product, but I won’t be ready to go commercial for a few years. Is there any way I can still protect it? Yes. If you have a “bona fide intent” to use the trademark on your game or product in the near future, say within 3–4 years, you can file a federal “intent to use” trademark application in the U.S. Patent and Trademark Office. Once the application is approved for registration, you’ll have three years in which to file proof of use of the mark, at which point the mark will register. If you don’t use the mark within those three years, the application will go abandoned and you’ll have to start all over again. Do I have to wait for my trademark to register before I use it? No. In fact, you can’t, because your trademark application won’t register until you use it. The sooner you start using the trademark on your game, the better. That’s because trademark rights in the United States arise only on commercial use of the mark on the goods. So, while you can file an application for a trademark you haven’t yet used, you cannot get an actual registration until the mark has actually been used commercially on the goods.

Can I get a trademark registration for the individual characters, repetitive graphics, or other distinctive elements of the game? Maybe. If the other elements are used solely internally within the game for the purposes of playing the game, then they are not being used as trademarks. If you are using them individually on collateral items, however, such as T-shirts, hats, mugs, keyrings, etc., then they may qualify as trademarks for those specific items. Remember that these elements will be covered by your copyright(s), so if they aren’t being used as trademarks, they’re still protected. If there are certain characters or specific designs that are going to be a common thread in your games, then you may want to consider developing a branding strategy around them.

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STEVEN BLICKENSDERFER sblickensderfer@carltonfields.com www.carltonfields.com/sblickensderfer 305.539.7340

Steve is a technology lawyer and co-chair of Carlton Fields’ Esports and Electronic Gaming Practice. Steve’s clients include game companies, esports teams, universities, content creators, and other companies in the video game space. Steve is also a certified information privacy professional (CIPP/US), and routinely helps clients—big and small—navigate data privacy and cybersecurity issues.

AUTHOR NICHOLAS A. BROWN

The authors would like to acknowledge the significant contributions of Nick Brown to this book and the development of Carlton Fields’ Esports and Electronic Gaming Practice. Nick served as the practice co-chair and assisted esports teams, content creators, higher education institutions, event facilitators, and intellectual property holders in navigating the unique legal issues that arise in the fast-paced and developing esports and streaming industry.

AUTHOR JILL RIOLA (Retired)

The authors express tremendous appreciation and gratitude to Jill Riola, retired Carlton Fields attorney, for her insight, mentorship, and generosity in making valuable contributions to this e-book and to their professional development.

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