Modding for Fun and for Profit

No video game is perfect in the eyes of every one of its players.  While some players vent their frustrations by complaining on a video game forum, more enterprising players seek to improve upon the game.  These players engaging in “modding,” or modifying the source code of the video game, to improve it in some way.  These mods range from graphics updates, such as the Skyrim mod seen here, to creating entirely new game types, such as turning the single player game Half-Life into the wildly popular, multiplayer game Counterstrike

.skymod-arora-sm

(Skyrim graphical mod; click to enhance)

However, most of these mods take place without the game developer’s permission.  Can the modder publish his mod without fearing retribution from a stingy developer?  What remedies do poor developers have against these enterprising players allegedly infringing the developer’s copyright?  This week’s blog post will discuss the legal approaches that developers have taken to deal with modders.  The first part will discuss the available legal remedies in the abstract (generally), while the second will discuss specific fights between video game developers and modders.

  1. Legal Remedies

Suppose Chris decides to create a website, HaxRUs.net, where he allows users to post any mod that they create.  These mods are freely available to the public.  Suppose Alan posts a mod for Super Smash Bros. on Hax-R-Us.net, which inserts into the game as a playable character his favorite Nintendo character, Dragoon from Super Metroid.  Super Smash Bros. is owned by Nintendo.   If Nintendo believes that its copyright on Super Smash Bros. is infringed, and wishes to remove Alan’s mod, it has two options.  First, it can issue a cease-and-desist letter to Alan.[1]  This letter orders Alan to remove his content, to stop infringing Nintendo’s copyright, and to cut a check for whatever amount Nintendo thinks that it can receive without going to litigation.[2]  Now Alan, a poor modder who just wanted to add his favorite Nintendo character to his favorite game, is faced with a choice: does he try to fight this in court just to have a more fun in a game, but at the risk of paying $30,000?  Not a chance.  He sadly removes his mod from Hax-R-Us.net.

Nintendo notices, however, that Hax-R-Us.net has many infringements of its copyrights.  Chris, as the mere owner of the website, who does not actively post any content, probably cannot be held liable.  Indeed, the criminal provisions of the copyright infringement statute require “intent;” thus, mere willful blindness to the posted infringements would not trigger any criminal penalties.[3]  In theory, Nintendo could attempt to prove this, but the law provides an easier method to remove infringing content: the DMCA takedown notice.  Nintendo may send Chris a notice of the infringing content, with a demand for its immediate removal.  Under the safe harbor provisions of the DMCA, 17 U.S.C. § 512(c)(1), if Chris:

  • Does not know and should not know that material on his website is infringing,
  • Does not receive a financial benefit directly attributable to the infringing activity, and
  • Upon notification of infringement, promptly removes or disables access to the infringing content,

then Chris will not be subject to liability for the infringing content.[4]

The safe harbor provision makes sense as a matter of public policy.  If it did not exist, then websites like YouTube, a site where millions of users upload videos daily, would not last more than a day.  Surely one user, oblivious to copyright law, would post infringing material, and the infringed party could sue to take down YouTube.  Indeed, a content provider, Viacom, did try to sue YouTube in 2013.[5]  The court held that YouTube qualified for the safe harbor provision of the DMCA because although YouTube knew that users were posting infringing material, it had no way of knowing what was and was not infringing.[6]

  1. Specific Fights Between Developers and Modders

In this Part, we will examine some of the conflicts that IP holders have had with modders.  In particular, we will look at a case where a developer sued a modder for providing access to the developer’s pirated games (Nintendo), a case where a developer sued a modder for basing a mod for a different game on the developer’s IP (Warner Bros), and a case where a developer sued a modder for modding the developer’s game to provide new content within the game (Blizzard).  On the other hand, some IP holders are more willing to work with modders, as we will see in the Bukkit, Spigot, and Battlestar Galactica cases.

Our abstract case from Part I., supra, may be different from the YouTube case.  Arguably, Chris knew that nearly all of the content posted on Hax-R-Us.net would be infringing (see: its name).  If Nintendo believed this, then the safe harbor provisions of the DMCA would not be triggered, and Nintendo could sue.  Indeed, it did just this in 2013, when Nintendo sued a website called HackYourConsole.com (“HYC”).[7]  HYC sold “flash carts.”  A flash cart permits a user to download pirated games from the internet and play them on the user’s 3DS gaming system.[8]  Nintendo alleged that these flash carts cost them a lot of money, because gamers no longer had an incentive to buy legitimate copies of the games.  HYC, on the other hand, had a notice on its webpage that the carts were “not illegal, however, the software you put on the [cart] may be.”[9]  Nintendo forced HYC into a settlement,[10] the website is shut down, and the URL HackYourConsole.com now redirects to Nintendo’s anti-piracy webpage.  Thus, IP holders are not afraid to sue for direct copyright infringement like piracy.

2014-09-29 00_40_33-Nintendo Anti-Piracy

(glorious leader Mario dislikes piracy)

Another possible form of copyright infringement is a novel work based on a pre-existing IP.  In 2012, Warner Bros. (“WB”) sued a group who was making a Lord of the Rings mod for the PC game Skyrim.  This mod, the Middle-Earth Roleplaying Project (“MERP”) changed Skyrim into a game designed around Lord of the Rings – everything from the aesthetic, to some of the characters, to a recreation of the Lord of the Rings story (“Ringbearer quest”).  WB responded with a cease-and-desist letter to the development team of MERP.[11]  WB argued that this mod amounted to a Lord of the Rings video game.  WB was involved in the production of several Lord of the Rings games, so MERP represented a competitive threat to WB’s games.  Initially, the MERP team tried to bargain with WB, and WB seemed open.  The MERP team offered to remove the Ringbearer quest, as well as player access to some of the main characters from the books, such as Frodo and Gandalf.  Ultimately, WB stonewalled these negotiations and forced the MERP team to cease development on the mod.  The MERP team responded with a Facebook petition, imploring WB to revoke its cease-and-desist letter.[12]  That petition has garnered 32,493 signatures in its two years of life; however, the MERP team appears to have given into the cease-and-desist order.[13]

A more direct type of mod than a device that enables piracy, or one that transforms another game into the IP holder’s IP, is an actual mod of a developer’s game against that developer’s consent.  In May, 2014, Blizzard pounced when a group of StarCraft II modders created a hack called the ValiantChaos MapHack.[14]  These modders committed two sins in Blizzard’s eyes.  The first was that the hack cost money – $62.50.  The second, however, was that the hack provided a competitive edge to purchasers.  This made the game less fun for legitimate players, which resulted in Blizzard losing players from StarCraft II.  Because Blizzard released its own, paid mods and expansions for StarCraft II, this represented a loss of profit to Blizzard.  Moreover, because StarCraft II is one of the most popular e-Sports,[15] Blizzard stood to lose a lot of market power if its game even appeared to be less than legitimate.  Thus, Blizzard sued, alleging copyright infringement, trafficking in circumvention devices[16], and breach of contract.[17]  This case is still pending.

In the middle of the modder-developer antagonism spectrum are IP holders that initially send cease-and-desist orders, but who eventually revoke them.  The facts of this incident are similar to the Warner Bros./MERP conflict above.  Modders in the game Second Life created a roleplaying simulation modeled on Battlestar Galactica.[18]  Universal, the holder for the Battlestar IP, sent the modders a cease-and-desist order.  The modders complied, but then they lobbied for Universal to permit the content.  Unlike Warner Bros., Universal gave in.  They permitted the users of the Second Life sim to continue, provided that they earned no profit.  In particular, Universal wrote “Users may continue to create and interact with each other as BSG fans . . . you may re-create BSG items under the fair use act.  Owners of any re-created items sold and/or purchased will be approached by the company’s lawyers hand handled accordingly.[19]  Users were also not permitted to create or sell “unlicensed [] real-life or virtual items featuring our intellectual property.”[20]  This sensible solution is a win-win – Battlestar Galactica fans get to keep their simulation, and Universal gets free publicity and fosters a fan community.

At the far end of the developer-modder antagonism spectrum are developers that, from the beginning, try to peaceably coexist with the modding community, such as the developers of Minecraft (Mojang) with the Bukkit Project.  Players play Minecraft on servers that are set up through the program.  This permits the owners of the servers to configure settings of the game – to a certain degree.  Bukkit sought to give these owners greater freedom in configuring their servers. [21]  The Bukkit community accomplished this by modding the Minecraft Server software, and creating a mod called CraftBukkit.  This took a tremendous amount of work and relied on contributions from many members of the community, as most good mods do.  This can lead to creative differences among the Internet strangers.  During the development of CraftBukkit, one modder, Wesley, decided that he no longer wanted his contribution to the project included in CraftBukkit.  When Bukkit refused to cooperate, Wesley issued a DMCA takedown notice, citing support from Mojang.

That backfired when Mojang rushed to Bukkit’s aid.  Posting on Bukkit’s forums, the COO of Mojang asserted Mojang’s rights to Minecraft in order to block Wesley’s DMCA takedown attempt.[22]  He posted that Wesley submitted his contributions to the project under an open source license, so Wesley could not claim infringement.  Wesley had no rights, and Mojang bristled at the idea that modders could “assert[] rights which they do not have, against us or others.”[23]

Moreover, the COO expressed support for the Bukkit Project.  He wrote that he wanted to support it, while maintaining independence between Bukkit and Mojang, as well as refusing to compromise Mojang’s ownership of the Minecraft IP.  Ultimately, he established that the Minecraft Server software would not be open source, nor would Mojang authorize its inclusion in any mods – but only to ensure that no one else tried to claim a right to Minecraft.  Despite taking this apparent legal step back, the COO made it clear that Mojang fully supported Bukkit and that Wesley had no rights against Mojang or against Bukkit.

Unfortunately, the tactic Wesley chose for his fight with Bukkit – the DMCA takedown notice – is very difficult to fight.  The DMCA requires only a good faith standard to issue takedown notices.[24]  This good faith standard is not subject to a penalty for perjury, so it has little bite.  On the other hand, a counter-notification imposes a good faith standard under penalty of perjury.[25]  As a result, when Wesley tried to claim infringement against another modding project, Spigot, all he needed to do was issue a DMCA takedown notice and wait for Spigot to choose its course of action.  In spite of Mojang’s pronounced support for the modding community in the Bukkit incident, Spigot decided to acquiesce to the takedown notice.[26]  Spigot’s reasoning was that, although they thought they could prevail in an infringement suit, litigating one in a U.S. District Court would require time and money.  The Spigot community decided that removing the infringing content would give Spigot “the best chance of continuing to operate in the future.”[27]  Thus, Spigot gave into this legal bullying, and removed the infringing content.

III. Conclusion

In this post, we’ve seen developers taking a no-tolerance approach to any infringements of their IPs, to developers who appreciate that having these sub-communities actually helps to grow the IP.  Here are a few questions for thought, but I’d like to hear any of your other thoughts too.

  1. Did any of the actions taken by the developers seem unreasonable to you?
  2. How would you handle infringement like this? Is there a distinction between the Blizzard case, where the mod incontrovertibly harmed the IP, and the Battlestar Galactica case?
  3. Is the DMCA fundamentally fair with regards to its takedown provisions? In particular, do you think that there is enough statutory protection against abuse of DMCA takedown notices?  How might you change the DMCA?
  4. How could other provisions of Fair Use be applied to some of these examples?

[1] The helpfully named “patent-trademark-law.com” website provides a template: http://www.patent-trademark-law.com/copyrights/plagiarism-take-down-stolen-content/cease-desist-dmca-takedown/

[2] The template suggests $10,000.  If the copyright is registered, and the holder can prove infringement in court, then the holder can collect up to $30,000 per copyrighted work.  17 U.S.C. § 504(c)(1).

[3] United States v. Liu, 731 F.3d 982, 989–92 (9th Cir. 2013).

[4] The content provider is also required to have a designated agent to receive such takedown notices.  17 U.S.C. § 512(c)(2).

[5] Viacom Int’l, Inc. v. YouTube, Inc., 2010 WL 2532404 (S.D.N.Y. 2010).

[6] Id.

[7] http://venturebeat.com/2013/08/07/nintendo-sues-modding-and-pirating-website-hackyourconsole-com/

[8] Ordinarily, when a user downloads a pirated game off the Internet, that user is limited to playing the game on his computer.  Flash carts permit the transfer of that game from the computer to the system for which the flash cart was designed – in this case, the 3DS.

[9] http://www.gamespot.com/articles/nintendo-launches-lawsuit-against-hacking-website/1100-6412649/.  The link that this article provided, to HYC’s FAQ page, now links to a Nintendo anti-piracy page with a scary, authoritarian picture of Mario: https://ap.nintendo.com/.

[10] http://www.examiner.com/article/hackyourconsole-com-shut-down-due-to-nintendo-lawsuit

[11] http://www.pcgamer.com/2012/09/06/middle-earth-roleplaying-project-mod-for-skyrim-petitions-wb-to-revoke-cease-and-desist/

[12] http://www.gopetition.com/petitions/save-merp-from-corporate-greed.html

[13] http://www.moddb.com/mods/merp-middle-earth-roleplaying-project

[14] http://www.forbes.com/sites/erikkain/2014/05/29/blizzard-sues-starcraft-ii-hackers/

[15] According to http://www.redbull.com/en/esports/stories/1331645000683/call-of-duty-tops-western-esports-audience, as of April 2014, StarCraft II was still the fourth most popular e-sport.

[16] 17 U.S.C. § 1201(a)(2)

[17] Complaint, Blizzard Entertainment, Inc. v. Does, 8:14-CV-00781 (C.D. Calif.)

[18] http://nwn.blogs.com/nwn/2011/02/fan-made-battlestar-galactica-content-allowed-in-second-life.html

[19] Id. (emphasis added)

[20] http://nwn.blogs.com/nwn/2011/02/fan-made-battlestar-galactica-content-allowed-in-second-life.html

[21] http://forums.bukkit.org/pages/about-us/

[22] http://forums.bukkit.org/threads/mojang-and-the-bukkit-project.309715/

[23] Id.

[24] 17 U.S.C. § 512(c)(3)(A)(v)

[25] 17 U.S.C § 512(g)(3)(C)

[26] http://www.spigotmc.org/threads/our-dmca-response.28772/

[27] Id.

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~ by tracejackson3 on September 29, 2014.

4 Responses to “Modding for Fun and for Profit”

  1. Great post with a lot of good examples.

    I think that developers are fully in their rights to assert control over their intellectual property. That being said, I think the strategy that developers use when dealing with unauthorized use of their IP should be one of a case by case basis. So, in some cases the developers have been reasonable and in other cases they have been unreasonable.

    The example of the paid Starcraft II expansion is the most clear example of how mods can harm the original IP. I think once money is involved, that is a bright line for when it becomes reasonable for developers to address modding directly, because that’s when Fair Use issues become absolutely clear. In the Starcraft II expansion case, the modders were trying to supplant the original game and profit from that expansion. I would have done the same thing Blizzard did.

    In the Middle-Earth case, there maybe a legitimate concern about cannibalism, that is, the brand competes with itself and cuts sales from legitimate releases by drawing players to 3rd-party mod releases of the brand. A certain portion of Lord of the Rings fans will purchase Skyrim and use the Middle-Earth mod to satisfy their gaming wants, rather than buying titles from Warner Bros. Some may buy both, but some may not. I could go either way on a situation like this if I was the developer.

    While some cases there is market justification for sending cease & desist, other cases don’t really have that kind of justification, and are pursued really more on principle or pride. The Chrono Trigger case, which was about a fan-made sequel to a Super Nintendo game from the 1990s, has virtually no risk of cannibalization. The company has all but abandoned the IP besides re-releasing the original game on other platforms, such as DS and iOS. I see no loss of profit for Square-Enix with fans making a sequel and only potential for building a cult following.

    In fact, we can look to a similar case from another cult favorite Super Nintendo game, Earthbound. When the game initially came out, the game flopped in the North American market with lackluster sales. After years of fans pirating the game, modding the game, making their own artwork, they had essentially created this cult following for this almost forgotten game. Last year, when Nintendo decided to re-release the game digitally on their newest console, it became one of the best selling games on the platform. That interest and subsequent sales were generated by this cult following. Nintendo has yet to shut down any of the mods or unofficial fan “sequel” activity.

    I think this kind of analysis is what motivated Universal to change their stance regarding Battlestar Galactica mods in Second Life. As long as there is no profit, these kinds of groups only serve to enhance enthusiasm for the brand and have virtually no drawback.

    I think you correctly pointed out that the DMCA is unbalanced in that there is no penalty at risk when filing a claim but there is a risk in counter-claiming. This should be changed. Make initial claims also at risk of perjury.

  2. Great blog post Trace. I especially enjoyed your discussion of the Minecraft, Wesley Bukkit dispute. However, I was a little disappointed that I was not included in your Hax-R-Us.net hypothetical. So I pose this new hypothetical: Robbie, a handsome, intelligent, up and coming lawyer has a lot of excess money. He decides to take that money to fund his dream job/project, developing a new video game about civil litigation trials. He contacts his law school classmate, Trace, who now works as a game developer and coder. They both decide to quit their respective jobs and start on the project. About three quarters of the way in, they begin to fight about the direction of the game and Trace decides to quit. Undeterred, Robbie pushes head and eventually finishes the game. Trace sees the game, loves it, and decides to create a massive mod for the game putting together ideas he thought should have been included in the original game. Robbie feels that this mod infringes on his copyright and sends Trace a cease and desist letter. Trace does not comply as he feels that he is entitled to mod a game that he helped create. Robbie decides to sue. Both this hypothetical and the Minecraft dispute involve the rights involved in a “shared work. Should Trace or Wesley have a right to control the content they created? In the Minecraft dispute, Wesley submitted his mod under an open source license. In Trace’s case, he did not have a license but rather a claim to the original IP. Does that claim give him the right to subsequently modify the original IP? I am not sure.

    Suppose that Trace was working on this mod before the game was even released. He might argue that the work is not a modification but rather a separate game entirely. In reality many mods are so huge and expansive that they can exclipse the original game in both size modifications have taken longer to develop than the original game they are based on. Rather than seeing these creations as “mods,” maybe courts should consider these derivative IP’s and provide the creators with some legal protection.

  3. Okay, I’m confused. At the risk of sounding completely foolish here, I’m going to attempt to glean some inferences (facts, too, perhaps) from this convoluted legal issue. Trace, no disrespect whatsoever; you’ve submitted an excellent blog post. The subject matter, however, is complex, riddled with blurred lines, and otherwise shrouded by grey area. Let’s bring this to light.

    First, a developer’s primary concern should be its target market’s demand for its product. Gaming juggernauts like Nintendo, holding hundreds of licenses, copyrights, and patents (more or less), should generally be unconcerned by a modder’s minor encroachment upon their intellectual property. In my opinion, the issue is exponentially inflamed if that modification flourishes and develops into an entity capable of usurping market demand for the original product.

    It seems as though such lack of usurpation was a deciding factor in Universal’s concession to modders in the SecondLife BSG feud. Under those specific circumstances, Universal was not at risk of losing dedicated BSG fans within its own market to the SecondLife mod; I’d venture a guess that many BSG fans hadn’t heard of SecondLife, much less knew of one specific virtual atmosphere existing within. Sure, brief exchanges in some of BSG’s truest-fan forums, coupled with excited chatter at gaming conventions, probably performed the function of informing some of BSG’s most loyal followers to that effect (ie: “Hey, check out Battlestar: Resurrection on SecondLife; it’s awesome!”), but true BSG fans aren’t going to return their DVD boxed sets in order to play the SecondLife mod, nor must they. In fact, the SecondLife modders expressly gave credit to Universal’s original production in their virtual representation. I’m reaching here, but the mod serves as an effervescent shrine, ceaselessly honoring the creators of the legendary original program.

    My point is, it’s reasonable for video game developers to concede under these circumstances, because what concessions are such developers making, really? Such a concession in these situations is arguably in a developer’s best interest, especially when the original product has already achieved legendary status, and the developer of the original rarely releases fresh material anymore. The mod in this situation is doing nothing more than generating interest in BSG and paying tribute to a great original program. It’s easy to understand, however, why developers in less amiable situations choose to dispute with modders instead of taking the mutualistic route demonstrated by Universal.

    On the Bukkit/Mojang issue, I’m not sure if I completely understand the dynamics between the modders and the COO of Mojang. Mojang necessarily acquired the rights to the Bukkit Project several years ago, a purchase that was rolled-into Mojang’s deal to buy Minecraft, correct? It seems as though Mojang sat on its rights and chose to do nothing with the source material, but was okay with modders manipulating the code from the original Minecraft? Are there two different codes at play here? I’m confused with the analysis presented in the blog and how it reconciles with the COO’s post on the forum, in which the COO offered his response to Wesley’s erratic attempt to shut down the Bukkit Project. I tend to agree with Trace’s analysis of the issue, but it seems as though there are multiple conflicting interests in this case, and I can’t reconcile any one of them with another.

    Moreover, I’m not sure if the Mojang COO is communicating truth in his statements. My initial inference is that he respects the commission of gaming projects, that he appreciates the high levels of commitment, time, and frustration that are expended in the attempted completion of such projects, but that his primary concern is, of course, protecting the original Minecraft IP. Is his refusal to act against the CraftBukkit mod an indication of his desire to sustain market interest in similarly-structured gameplay, while he bides his time and waits to release a new version of the original, or is his inaction truly an indication of mutual respect and tolerance? If neither, then are they the same company, without conflicting interests? I’m truly having a hard time understanding the relationship between parties here.

    Chris

  4. Great posts everyone. Nice job this week. The modding issue really is complex aa can be seen from the principle post from Trace. It really is in the game developers interest that modding take place because although fans may love the game that is released, sometimes the developers just haven’t done a good job on aspects of the game. Maybe the project was rushed. Maybe a particular team envisioned an aspect of the game play that actually runs counter to how the players, in fact, play. Or perhaps the person developing the UI did not create one that is user friendly. It is the modding community that helps players stay loyal to the developer’s product but also make it usable and enjoyable for themselves. More and more game developers are now releasing code to the modding community as they develop the game so players can get the modding process started early.

    Of course, as with everything in life, a line can be crossed and conduct occurs that requires the lawyers to step in. How the lawyers step in can be just as important as the fact that they stepped in. As you can see in the Universal incident with Battlestar Galatica, it is possible to come to terms that meet the needs of the fans and the IP holder. We can contrast the Battlestar Galatica matter with the way the lawyers for the publicist representing Frank Herbert handled the Dune sims. A cease and desist letter was filed. All Dune sims in Second Life had 48 hours to shut down. No negotiations were held and Linden Labs shut all the sims and removed inventory from players which it considered might possibly violate the Dune IP. The lawyers came back and wanted to prohibit anyone from using the word “spice.” For those of you not familiar with the Dune stories, spice was the substance mined on the planet Arrakis. It had mind expanding powers. But the word “spice” is a common word…um…every heard of cinnamon? I believe Linden Labs actually opposed that aspect of the request. Of course on the Dune sims, the owners were selling items like “stillsuits,” the equipment required to survive in the desert in the Dune stories. The stillsuit was L$800, a little over $3.00US. Even if 100 people purchased the stillsuit, would that have been enough of an economic hit to negatively impact the publicist from Dune? Unlikely, nonetheless, the sim owners were not going to be able to challenge in a lawsuit. The publicist won… and maybe he should have, but one has to ask, wouldn’t there have been a better way to handle the matter. George Lucas certainly thought so, and his treatment of fan created materials was legendary for it’s generosity.

    @Chris – With the Minecraft situation: Minecraft gave license for the mod and they have established rules for the modding community. The modder who issued the take down notice knew it was a mod and knew what the terms were when he joined the project. It then seemed disingenuous for him to protest against the use of his portion of the project. Mojang then is in a difficult situation. Do they inject themselves all the way into the fight? With hundreds maybe even thousands of modders in that community, participating in the dispute at a greater level would potentially be a dangerous precedent. That is a dificult situation both for the IP holder and for the community of modders.

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