What does the termination of a contract do to certain intellectual property rights that were granted, in perpetuity, from one party to another within that document? A recent ruling in the U.S. Southern District of New York can be instructive on this issue.
Is it true that no one can own a dance step? That is what video game publisher Epic Games is arguing in a motion to dismiss that it filed on February 11 in a federal case that was brought by Terrence “2 Milly” Ferguson.
The following article was written by Benjamin Haynes, Esq.
In 2009, former Rutgers quarterback, Ryan Hart, filed a lawsuit against Electronic Arts (E.A.) for violation of his right of publicity. Specifically, Hart stated that E.A. misappropriated his likeness for use in the NCAA Football video game in order to enhance the commercial value of the video game. For example, in the 2006 NCAA Football game, the Rutgers quarterback wore number 13 as well as had the exact same height and weight as Ryan Hart. Even further, the player’s biographical and career statistics were also included in the game. Although the names of the players are not issued in the game, it is unarguably apparent that Ryan Hart was meant to be depicted as the Rutgers quarterback.
On November 12, 2010, E.A. filed a 12 (b)(6) motion to dismiss or, in the alternative, motion for summary judgment. E.A. then argued that it was entitled to summary judgment based on First Amendment grounds. Hart’s counsel responded by stating that discovery was still outstanding and thus summary judgment was premature. However, the court found that Hart had failed to show how discovery would assist the court in deciding the case. Therefore, the District Court granted the summary judgment in favor of E.A.
On May 21, 2013, the U.S. Court of Appeals for the Third Circuit issued an opinion which reversed and remanded the District Court’s initial decision. The District Court initially granted summary judgment in favor of E.A.
The Court of Appeals rightfully mentioned that this case would be determined based upon a balancing of the interest between the right to free expression against the interests in protecting the right of publicity. Zacchini v. Scripps-Howard Broad. Co., 433 U.S. 562, 574-75 (1977).
When dealing with freedom of expression, it is understood that this is a “fundamental principle of the American government.” Whitney v. California, 274 U.S. 357, 376 (1927). Further, such expression is noted to be an integral part of the development of ideas and a sense of identity. Procunier v. Martinez, 416 U.S. 396, 427 (1974). This established First Amendment precedent provides a heavy protection in the balancing test against the right of publicity.
While free expression is given extreme weight in the history of societal growth, the right of publicity also carries an important dynamic in this balancing act. “It is unfair that one should be permitted to commercialize or exploit or capitalize upon another’s name, reputation or accomplishments merely because the owner’s accomplishments have been highly publicized.” Palmer v. Schonhorn Enters., Inc., 232 A.2d 458, 462 (N.J. Super. Ct. Ch. Div. 1967).
Taking into account the importance of both the First Amendment and the right of publicity, the Court of Appeals recognized the need to analyze this case through one of the various balancing tests. The three tests that were discussed are 1) the commercial-interest-based Predominant Use Test; 2) trademark based Rogers test, and the 3) Transformative Use test. The court further explained each test and dismissed the Predominant Use and the Rogers tests as not being applicable to this instant action. However, the court found that the ever so popular Transformative Use Test was applicable here.
Transformative Use Test
This test was introduced to the intellectual property world through a case entitled Comedy III Prods., Inc. v. Gary Saderup, Inc. 21 P.3d 797, 804-08 (Cal. 2001). Based out of the Supreme Court in California, the Comedy III case consisted of an artist’s production and sale of t-shirts and prints which had a charcoal drawing of the Three Stooges. This court determined that while “the right of publicity is often invoked in the context of commercial speech,” it could also apply in instances where the speech is merely expressive.” Id. At 802-803. The court went on to apply the “fair use” factor to the Comedy III case. The fair use factor seeks to determine whether the new work adds something new, with a further purpose or different character, altering the first work. Essentially, this doctrine asks whether or not the new work is “transformative” enough to evade infringing on one’s right to publicity.
In applying this Transformative Use Test to this instant case, the issue presented is whether Hart’s identity is sufficiently transformed in NCAA Football. Looking at the player’s avatar, the court found that the appearance of the digital avatar does closely resemble Hart. Specifically, the court found that the hair color, hair style, skin tone, and player’s accessories are identical to Hart. However, the court determined that videogame graphics are not the end of the analysis. The next step is looking at the context in which Hart is used in NCAA Football. This analysis concluded that there are not any transformative elements, based on context, because Hart “does what the actual Ryan Hart did while at Rutgers: he plays college football.” Id.
While the appearance of the avatar and the context of which the avatar is used are important elements to dig into, they are not the only two elements in determining whether the Hart character is transformative or not. Another important element the court analyzes is whether a user of the game has the ability to alter the avatar’s appearance. The District Court decided that the ability to change the avatar satisfied the transformative test. However, the Appellate Court inquires as to what extent the ability to alter a digital avatar represents a transformative use of Hart’s identity. Unlike the District Court, the Appellate court found that just having the ability to change the avatar is not sufficient enough to satisfy the Transformative Use Test. While having an interactive element does provide for First Amendment protection, the court recognized that “interactivity cannot be an end onto itself.” Kirby v. Sega of Am., Inc., 50 Cal. Rprt. 3d 607 (Cal. Ct. App. 2006).
The Appellate Court then determined that “because Hart’s unaltered likeness is central to the core of the game experience, we are disinclined to credit users’ ability to alter the digital avatars in our application of the Transformative Use Test in this case.” Id. Therefore, the holding by the Appellate court is that NCAA Football does not sufficiently transform Hart’s identity enough to escape Hart’s right of publicity claim, and the District Court was found to have erred in granting summary judgment in favor of E.A. This action has therefore been reversed and remanded.
This is a definitive case for athletes everywhere. Based on this decision, video game creators may not misappropriate a player’s likeness, and legally get away with it, just because there is some form of misdirected creativity involved in the video game.
Here is a sample definition of likeness – name, silhouette, personality, appearance, performance, depiction, portrayal, photograph and voice. It is an integral definition in many licensing agreements where one party hopes to be able to exploit the other party, usually for a hefty fee. What if you were not entitled to just compensation for the use of your likeness by another? On one end, people have a right to control their image and reap a reward when others use it. On the other, free-speech rights under the First Amendment should allow certain uses of likeness without permission in particular instances. Read more “Sam Keller Seeks To Protect Athletes’ Right of Publicity”
Very talented athletes stand to make more money from off field/court/ice/etc. activities than what they earn based on performing in the trade that they are truly qualified. Agents, attorneys, and marketers attempt to find and negotiate these deals for their athlete clients. Often times, those deals are licensing agreements, or at least contain provisions that grant companies a license to use something of and concerning the athletes.
Many states are currently considering new Right of Publicity legislation, which have the potential to limit athletes’ ability to protect their likeness from being used without receiving just compensation.
In Michigan, the legislature will consider whether video games should receive an unqualified exemption from Right of Publicity claims. If all states passed such a law, athletes would have a very hard time trying to secure millions of dollars from video games manufacturers based on the their use of players’ images and likenesses without their permission.
In New York, proposed legislation not only grants an unqualified exemption on video games, but also greeting cards, games that use multiple personalities, calendars, and t-shirts. Athletes stand to make a lot of money based on the licensing of their attributes for video games, but multiply that many times over when you consider t-shirts and other apparel.