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What game creators need to know about protecting their brands

Law firm Lewis Silkin dissects a recent kart racing suit filed by Nintendo and offers advice for game companies

The gaming industry, in similar fashion to film and TV, is driven by the presence and importance of memorable characters. Sonic, Mario, Donkey Kong and the like hold immense goodwill among consumers, especially those that have spent innumerable hours helping them on their quests for precious gold coins and princesses.

For the entertainment brands that spawned those characters, maintaining a monopoly over the right to exploit them is a key part of their business. The cheeky Italian plumber and his friends form part of a global, multi-billion dollar merchandising industry. And that industry is no longer simply about selling t-shirts and lunch boxes; Fred Flintstone is selling Halifax mortgages and characters from the Final Fantasy franchise have been promoting handbags.

Games brands recognise that a significant part of the value of their characters is in the relationship between characters and their fans. Pac-Man isn't just popular because of his 8-bit styling and riveting back story; fans associate him with their childhoods and feel he is part of their history. There is a perception of a communal ownership of some of those characters, and this can make it difficult for brands to draw the line on where and when to try to prevent fans from expressing their enjoyment of the characters in ways that might conflict with their rights.

The moustache matter

Brands generally tolerate (sometimes even encourage) individuals to reference their characters, provided they are not commercially exploiting them. However, unauthorised commercial exploitation of characters often ends up with disputes, as we have seen with the Teenage Mutant Ninja Turtles, Storm Troopers, and Betty Boop.

Well, now Mario and his nearest and dearest / mortal enemies have found themselves caught up in litigation. Nintendo has recently announced that it is suing MariCar, a company that offers city tours in Japan with a difference: the tourists dress up like characters from the famous Mario Kart franchise and drive around various Japanese cities.

According to the press release, Nintendo are seeking to protect their "valuable intellectual property" that they have "built up over many years of effort" and are therefore suing for copyright infringement and 'unfair competition'. Nintendo also warn that they will take action against others in the future.

It could be argued that, in doing this, Nintendo has taken a bit of a commercial gamble that they are not going to alienate their legions of fans by coming down hard on what many (particularly in Japan) might call simple 'cosplay' (i.e. costume role-playing).

If the case ever reaches trial, it will involve a fascinating debate (to lawyers, anyway) over the extent to which a red cap and fake moustache are protected by copyright in Japan. It will also involve an assessment of whether the word "MariCar" is similar to "Mario Kart" and whether MariCar is unfairly generating revenue through riding on the coattails of the Mario Kart brand. MariCar will presumably argue that it has created sufficient differences in the costumes and that they are just facilitating 'cosplay'.

What if MariCar came to England?

In the UK, brands have relied on a patchwork of rights to prevent third parties exploiting their characters. For example, the owners of the rights to the Teenage Mutant Ninja Turtles relied both on copyright (in the drawings of the characters) and 'passing off' (i.e. that the public would expect t-shirts bearing the characters to be licensed or authorised). In the Betty Boop case, mega-publisher Hearst relied on copyright infringement, passing off and also trade mark infringement.

"Registered rights are often the first line in preventing third parties from benefiting from your hard work. Register the name, and even a drawing, of the character as a trade mark, and not just in relation to computer games"

If Nintendo were suing for copyright infringement in the UK, they would need to show that MariCar had copied a "substantial part" of the original Mario designs. Such a case would, however, bring up the often quoted rule that copyright protects the expression of an idea, not the idea itself. So, Nintendo would have no general ability under copyright to prevent third parties from operating a go-karting city tour with various characters, including a princess, a mushroom and a plumber; it can only prevent the copying of its "artistic works". This would necessarily descend into an analysis of all of the elements of the characters that have and have not been copied, and whether those elements alone or cumulatively constitute copying of a substantial part.

A UK 'passing off' claim would have its difficulties as well. If the images of the MariCar business online are anything to go by, the costumes are hardly faithful replicas of the 'get-up' of the official Mario Kart characters. Indeed, it is hard to believe that consumers would believe that they are actually authorised by Nintendo, especially as some of the costumes are non-Nintendo characters such as Minnie Mouse, Superman and Sesame Street's Cookie Monster.

Top tips for gaming businesses

Gaming is a significant growth industry, with legions of loyal fans and rising financial and commercial stakes. Further, it is now cheaper and easier than ever for individuals and small studios to enter the market, creating characters in fun, arcade-style games and launching on platforms such as iOS and Android-enabled devices. These characters can swiftly gain traction and become capable of exploitation outside of games; one need only look at the massive success of the Angry Birds franchise to see how this can happen. But what should games creators and brands be doing to ensure they make the most of their creativity and hard work?

Here are our top tips for games creators and brands:

1. Know what you own

Did you get an assignment of intellectual property from everyone involved in the coding of the game or the design of the character? The general rule is that copyright in literary or artistic works is owned by the "author" (with the exception of employees). This means that design agencies and freelancers, for example, will likely own the copyright (and related rights) in their coding and/or designs unless they have assigned them to you.

2. Register your rights

Registered rights are often the first line in preventing third parties from benefiting from your hard work. Register the name, and even a drawing, of the character as a trade mark, and not just in relation to computer games, but also in relation to television, films, merchandising and retail. Also consider registering characters as designs to give additional protection.

3. Have a strategy

Games producers often want to encourage respectful use of their intellectual property. Do you encourage 'cosplay' and fan sites that use your brand? Or do you rule with an iron fist? Either way, pick a strategy and stick with it.

4. Have good contracts

Where using third parties to provide certain services, such as hardware, software or design, make sure that those relationships are formalised, and not just on whatever terms were attached to an invoice. Contracts in the games industry exist within the context of tight release schedules and often deal with complex issues relating to intellectual property, liability, and technical service levels and deliverables.

5. Keep good records

Keep dated drawings of characters and code, and keep them safe. Where designers are creating new versions of game functionality or artwork, are they simply overwriting previous versions? If they are, you could be losing valuable evidence of someone having copied a key element of that product. If possible, different iterations of games and artwork should be securely stored.

6. Improve your security

It is a sad fact that corporate espionage and cyber-crime are on the increase. Games are the culmination, often, of years of work, which would be hugely damaging to lose. Further, games brands often hold masses of confidential information, including individuals' personal data. Would you know if someone had removed documents from your network either physically in person or from the other side of the world?

Oliver Watson, Managing Associate and Oliver Fairhurst, Associate at law firm Lewis Silkin

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