Rules & borders - regulating digital environments. (Ownership in Online Worlds) (Panel Discussion)

Publication: Santa Clara Computer & High Technology Law Journal

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COPYRIGHT 2005 University of Santa Clara, School of Law

FEBRUARY 11, 2005

PANEL 3--OWNERSHIP IN ONLINE WORLDS

Online worlds are becoming more immersive, and individuals are being invited to participate more fully in these worlds. Participants are being given more and more individual choices, the ability to interact more fully, and the opportunity to create lasting social interactions. Should intangible objects acquired in these worlds be treated as personal property? Should individuals maintain their personal rights while present in online worlds?

Masato Hayakawa, Cory Ondrejka, Seth Steinberg, and Andrew Zaffron discuss these issues in a panel discussion moderated by Santa Clara University, School of Law Professor Tyler Ochoa. The following is an edited transcript of their discussion.

Ochoa: Now, the usual response when I pose this question to people is, "Well don't be ridiculous. Of course they don't have any ownership rights because there's an end user license agreement ["EULA"] that specifies that the game provider owns anything and everything that goes on in the online world. The end user license agreement provides for that." While I agree as a practical matter that it may be the case that the end user license agreement takes care of these issues, I find that answer unsatisfactory for at least two reasons. One: The end user license agreement might be non-existent or unenforceable or preempted in a particular instance. It may be that a game provider that does not have access to good legal counsel may have neglected to obtain end user license agreements from certain people who play the games. It may be that a court might find a particular provision unenforceable in some respect. If you had an end user license agreement that said, "you violate some condition of the game, you turn over your first born," I guarantee you that a court would not enforce that. And they may find some provision unenforceable as against public policy. Or it might be preempted by federal copyright law in some instances. Two: Whether or not that's the case, I think it's logically backwards to say that the end user license agreement takes care of everything because, analytically, what you want to say is, "Well, what's the default position? If we didn't have a license at all, who would have ownership rights in this creation?" Then you ask whether or not that is changed by the end user license agreement; and then third, you ask whether or not that end user license agreement is enforceable. So it seems to me, as an analytical matter, you want to start with the default position--What would happen in the absence of an end user license agreement?--and then talk about whether or not the end user license agreement affects that. So, for purposes of the third panel, I've asked my panelists to assume an online game and to assume away questions of the enforceability of the end user license agreement and talk about what the default issues of ownership are and how they might be resolved.

So, let me introduce our panelists, who are ready to address this issue. I'll start on your left, on my right. At the end over here, we have Seth Steinberg, who is the Director of Business Affairs and General Counsel of LucasArts, a subsidiary of Lucasfilm. LucasArts is the leading developer and publisher of interactive entertainment products for video game consoles, computers, and the Internet, and, of course, is the provider of massively multi-player online role-playing games ["MMORPGs"] based on the Star Wars properties. Prior to joining LucasArts, he was Legal Counsel for Business and Legal affairs for 989 Studios and Sports, a division of Sony Computer Entertainment of America ["SCEA"], was, prior to that, an associate at Reinis and Reinis in Los Angeles. His degrees are from the University of Wisconsin-Madison, and his J.D. from John Marshall Law School, and it's a pleasure to have you.

Steinberg: Thank you.

Ochoa: Next to Seth is Masato Hayakawa, who is a lawyer with the San Francisco office of Morrison and Foerster and is with their Technology Transactions Group, which provides legal assistance to clients in various sectors of the video game industry, negotiating agreements for video game development and licensing of technology and content. His degrees are from the University of California, Berkeley, with a J.D. from Yale Law School, where he was an editor both with the Yale Journal of International Law and the Yale Law Journal. It's a pleasure to have you.

Hayakawa: Thank you.

Ochoa: On my left, your right, we have Andrew Zaffron, who is the Senior Vice President and General Counsel of Sony Online Entertainment ["SOE"] and is responsible for all legal and business affairs of the company. Prior to that, he was the director of legal and business affairs at Sony Computer Entertainment of America. Again, involving intellectual property licensing, including in their online game division. He has both a Bachelors degree and a J.D. degree from the University of Illinois.

Zaffron: 24 and ... basketball team.

Ochoa: The basketball team is doing extremely well, and I'm sure he'll be making a licensing arrangement for them to appear with Sony as soon as possible. And finally, on the far right here--not politically necessarily--but from the point of view of the room, we have Cory Ondrejka, who is the Vice President of Product Development for Linden Research. He is Vice President of Product Development in Linden Labs' award-winning digital online world; it's called "Second Life." And he was instrumental in their decision to allow users to retain intellectual property rights to their creations in Second Life. Prior to that, he was a Project Leader and Lead Programmer for Pacific Coast Power and Light, developer of "Road Rash," and a Lead Programmer for Acclaim Coin-Operated Entertainment. His degree is from the U.S. Naval Academy. He has a Bachelors of Science degree in both Computer Science and Weapons and System Engineering, so, if you don't like his answers to the computer science questions, he may bomb us all into oblivion. [laughter]

Okay, now that I've introduced the panel, I'd like to get into the hypothetical, and I've posed four sets of questions to the panel that I'd like to talk about this afternoon. But the general hypothetical is one with which we are all familiar [with] to varying degrees, and we can vary it as we go along. Suppose we have some type of massively multi-player online role-playing game, a simulation-type ["simstype"] game. And this game allows a user to customize his or her character in the online world to some degree, and we'll talk about what degree of customization is necessary for certain consequences to follow, but as is typical in many of these online role-playing games, there may be a fair degree of customization, a lot of different traits that your character may possess that you can choose various things from, and perhaps the NCSoft case (1) provides us with a nice template for thinking about this. You can play lots of different kinds of superhero characters in the NCSoft game, or it might be a sims-type game in which the characters are somewhat more realistic with more human attributes rather than character attributes. Or, at the far end, some type of Lucasfilm games, where almost all of the characters are based upon or derivative in some way of characters originally created for the Star Wars films. So we have some type of role-playing game. A user enters, and creates for himself or herself some type of avatar, and the word avatar is used in this context to refer to the character that someone is playing in the game. And they invest a lot of hours in playing this character as part of their entertainment in the online game, and the character interacts with other characters inside the game, with other people's avatars, has dialogue with other people inside the game, and has lots of experiences and events that occur. In the course of their life in the online game, they may acquire digital property of some type, and we'll talk about the digital property as a second set of issues.

So the first thing that I ask the panelists to address, is what are the various copyrightable works that exist here? Clearly, there is the software code that manages all of this interaction, and nobody questions that the software code is, of course, a copyrightable work. And, in the context of video games generally, we have seen that the screen displays generated by software code are generally considered copyrightable works of authorship that are protected by the copyright in the software code itself. But, are there other copyrightable works here? Is this whole game subject to a single copyright, or can it be subdivided into a number of different copyrights, and, if so, what types of works do we have here? So, let me open it up to the panel and ask: Is this a single copyright? Do we have multiple copyrights here? Is this some type of collective work? What is it? We'll start with Seth down here.

Steinberg: I believe you have a single copyright in the entire work. I think it does depend quite a bit on the type of game, so, to use your two reference points of City of Heroes versus LucasArts and Sony Online's game Star Wars Galaxies, you have two different entire environments, so it's a little clearer, I think, in one than the other. But everything is derived from the materials and assets being afforded to the end user by the publisher.

Ochoa: So code controls everything?

Steinberg: Code and the assets afforded through that code such as the art assets, for example, that are provided through the server, yes.

Ochoa: When you say "art assets that are provided by the server," what is it that the server provides in the Lucas game as opposed to some other types of games?

Steinberg: Well, without playing all the other ones, certainly if you go on to Galaxies, you can create and grow any character that derives form the Star Wars universe, which dates, as David pointed out this morning, all the way back to 1977. And you're given assets to take different skin tones, different hair tones, different facial animations, but all that is being provided to you by the publisher or the host--in this case, Sony Online--to use and customize within the persistent universe that the player has been afforded.

Zaffron: Sticking with that example, this isn't an instance where it's a blank piece of paper, and the publisher provides the player with the box of Crayola crayons and says, "Make your character." The metes and bounds of all elements of customization are controlled by the designers and the artists that make the game. Again, to move further in the Star Wars Universe example, if there's a character race that's a Wookie, well, the skin tones of the Wookie, the metes and bounds of those, the lightest and the darkest, are set up by the designers and artists, obviously with Lucas's input and approval. After all, they're kind of the guardians of the property. They're the ones that know how dark a Wookie can be before it stops being a Wookie in order to control their property. How long a nose can the Wookie have? Our initial customization routine allows changes of body size, face shape, nose length, and all that kind of stuff, but all of that, the metes and bounds of it, is dictated by the artists, designers, and LucasArts and Lucas Licensing as well. I imagine that George Lucas would be really annoyed if we let players start a Wookie with a nose out to that exit sign, and all of that art work, the textures that go into that, are all designed by our designers, created by our artists--the tiles, the colors, and the palettes, and all that kind of stuff. So, while it's a broad set of choices that a player has in customizing a character, it's kind of an infinite number of choices between here and here in each of those decisions. So, you know, to suggest that it's kind of a blank slate where we just dump a box of crayons on the player and say, "Hey, make your character," and the player's creative juices completely make that, I think, is kind of a false premise.

Ondrejka: So how many different characters can you make in Galaxies?

Zaffron: Probably infinite, but, again, within those metes and bounds, and the metes and bounds are set by us, the models are created by us, and the textures are created by us. But it's got to be infinite because there's this slider. I'm not a programmer, but I don't know what gradation is in the number of different instances that that slider will move between the two metes and bounds on every element of the face and body and skin tone and all that kind of stuff. It's a lot.

Ondrejka: I think the question of breadth is actually a real interesting one. Obviously, Second Life comes at this from a slightly different perspective since we actually give our users IP rights in all these things that they make, but, putting that aside for the moment, thinking about the breadth, I think it's important. If you were looking at a box of Legos that ships to you with forty Legos in it, Lego designed every one of those pieces to exacting specifications, and they even give you some designs. You know, build this one, build this one, build that one. But there are a lot of configurations that you can build out of those pieces that none of their artists or play-testers necessarily have ever created, and so--certainly from my perspective as not being a lawyer clearly, so feel free to ignore this--but we are talking about an unimaginably large breadth of possibilities. The idea that, by giving all these options to the player, now Sony and Lucas have IP rights...

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