Virtual Worlds Get Real—At a Price

Designers looking to use real world people and landmarks in their games should watch out

The latest gaming platforms have taken virtual environments to a new level of realism and complexity—beyond anything envisioned at the time of Pong or Computer Space. With interactive virtual worlds now commonplace, developers leverage the latest technology to stretch the boundaries of their imaginations to create the most sensational, graphic and real games possible.

This realism, however, comes at a price, and developers should beware.

Most developers understand that well-known individuals have legal rights protecting them from the unauthorized use of their identities. But did you know landmarks and buildings do too? And famous (and not-so famous) stars and rights holders are asserting these aggressively against unwary developers and game publishers.

These legal rights aren't just theories in a text book. Two recent lawsuits in California have tested the boundaries of the law, and while the video game defendants prevailed, developers and publishers cannot disregard the identity rights of real world personas, brands, or locations.

The Individual Right to Publicity

Kierin Kirby, the former lead singer of Dee-Lite, sued Sega for the use of Ulala (the main character in the game Space Channel 5) who developers seemed to base on the singer's on-screen persona..

Space Channel 5 features the player-controlled protagonist Ulala, an anime-style reporter that is on a mission to defeat waves of aliens in dancing competitions by matching their dance moves. Marketed in the United States, Japan and Europe, the game's creators even considered licensing the Dee-Lite hit song, "Groove is in the Heart" to promote the game. However, the creators of the game testified that they did not base Ulala on Lady Miss Kier, but on Japanese anime archetypes.

Kirby, a pop star from the 80s and 90s with costumes and hairstyles similar to Ulala's, based her claims on her legal "right to publicity," which protects an individual's—particularly a famous individual's—right to commercialize and license her fame in a manner of her choosing.

The Court, ruling in Sega's favor, found the developers had a First Amendment right in creative expression. Sega successfully established that Ulala bore many differences from Lady Kier; including a different hairstyle, different costumes and a different body style.

Sega also showed that Ulala's dance movements in the game were different from Lady Kier's moves in Dee-Lite's videos. Finally, Sega proved that the context in which Ulala was used in Space Channel 5 was unlike any Dee-Lite videos or other public appearance made by Lady Kier. Based on these differences, the Court ruled that Ulala did not emulate Lady Kier, but rather was a "transformative" use and therefore protected artistic expression under the First Amendment.

The Right of a Landmark: Trademark/Trade Dress Liability

The "PlayPen" gentleman's club in East Los Angeles sued Rockstar Entertainment for the inclusion of a strip club called the "PigPen" in the virtual universe of Grand Theft Auto: San Andreas. The PlayPen alleged that the PigPen violated the PlayPen's trademark and trade dress rights because it was a similarly situated strip club with a similar name.

These types of arguments are common in trademark and trade dress lawsuits. Trademarks and trade dress are an area of intellectual property law giving a party the right to protect the distinctive logo or layout that serves to identify its goods and services.

Developers looking to populate a virtual world with real-world landmarks bearing distinctive features, signs, color patterns or slogans should be on guard against potential trademark or trade dress lawsuits from the real world owner of that mark. This form of protection does not just apply to famous marks (such as the McDonald's Golden Arches), but can also be applied to locally known distinctive marks, such as those of the PlayPen plaintiffs in the Rockstar case.

The owners of PlayPen argued that the inclusion of the PigPen strip club in the game violated the PlayPen trademark and trade dress.

GTA: San Andreas, includes the virtual city of Los Santos, which closely emulates Los Angeles. Since the virtual PigPen was located in East Los Santos, the PlayPen argued that gamers would be confused and believe that the depiction of the PigPen in GTA was endorsed by the PlayPen. The PlayPen also argued that the name PigPen sounds similar to the name PlayPen, and that the PigPen looked like the PlayPen in some ways (though the PigPen also looked clearly different in many ways). Further supporting this claim was the admission by Rockstar that its developers had surveyed parts of East Los Angeles, including the PlayPen, for inspiration for the depiction of Los Santos in GTA.

Nevertheless, the Court ruled in Rockstar's favor, again based on the First Amendment. The Court determined that the PigPen had "artistic relevance" to the overall artistic design of the GTA universe, meaning that it was not a gratuitous use of a well-known mark, and further that Rockstar did not explicitly mislead consumers to believe that PlayPen had sponsored GTA or approved the use of the PigPen. In making this finding, the Court also took into account that the PigPen was physically different in many ways from PlayPen. Under the First Amendment law applying to trademark cases in California, the Court found that the PigPen strip club was protected artistic speech.

Don't Celebrate Yet: Some Words of Caution

While Sega and Rockstar prevailed in these cases on First Amendment grounds, developers are not out the woods yet. Despite these rulings, you cannot disregard the identity rights of real world personas, brands, or locations. Both the Sega and Rockstar cases were decided on a fact-specific basis, balancing the video game developer's right to creative expression against the extent of infringement on the plaintiffs' identities. There is no guarantee that future cases will come out the same way.

Another important thing to note is that both cases were decided under the First Amendment. However, these decisions are not binding on other courts, and there is no guarantee that different courts in different states would apply the First Amendment in the same way (or at all).

Lessons Learned

What lessons can a developer learn from the Space Channel 5 and GTA cases? First, that, at least in California, video games are a form of protected expression, like books, music or movies; and thus video game developers are allowed creative expression in creating realistic gaming environments.

The keyword, however, is "creative."

Sega escaped liability in its case because the main character had notable physical differences from Lady Kier, and the game's setting differed completely from that of Dee-Lite's music and videos. Similarly, Rockstar escaped liability by showing that the virtual PigPen looked different in many ways from the PlayPen, and was in line with GTA's vision of the real world that is both gritty and satirical.

These results were extremely fact-specific. The fact that PigPen was only a small part of the GTA universe and different in many respects from the PlayPen surely weighed in Rockstar's favor, and had PigPen been found to be more similar to PlayPen or if it played a larger role in GTA, the case could have resulted differently.

In modeling the real world in a virtual environment, game developers should always think carefully when including distinctive individuals, landmarks, or locally known businesses or logos. Any such inclusion could ultimately result in an intellectual property lawsuit.

While the First Amendment does protect creative renditions of the real world, so long as they are keeping with the artistic vision intended by the developer and not likely to lead one to the belief that the game was sponsored, this protection is limited. Many of these potential disputes can be avoided much more simply through a license or other negotiation with a potential plaintiff.

In sum, if your virtual world starts getting a bit too "real," it may be time to consult an attorney.

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