A recent federal district court decision denied a motion to dismiss a complaint brought by Artifex Software Inc. (“Artifex”) for breach of contract and copyright infringement claims against Defendant Hancom, Inc. based on breach of an open source software license. The software, referred to as Ghostscript, was dual-licensed under the GPL license and a commercial license. According to the Plaintiff, those seeking to commercially distribute Ghostscript could obtain a commercial license to use, modify, copy, and/or distribute Ghostscript for a fee. Otherwise, the software was available without a fee under the GNU GPL, which required users to comply with certain open-source licensing requirements. The requirements included an obligation to “convey the machine-readable Corresponding Source under the terms of this License” of any covered code. In other words, under the open source license option, certain combinations of proprietary software with Ghostscript are governed by the terms of the GNU GPL.
Continue Reading Important Open Source Ruling Confirms Enforceability of Dual-Licensing and Breach of GPL for Failing to Distribute Source Code

Another lawsuit alleging illegal gambling in a social game has been dismissed.  Over the last year, social gaming mobile applications have come under attack from the Plaintiffs’ bar as gambling in disguise.  Plaintiffs’ attorneys theorize that in-app micro-transactions where consumers pay cash for virtual items (i.e., gold coins or gems) designed to speed up or otherwise enhance gameplay are, in effect, wagers insofar as other in-game materials can subsequently be “won” with those items.  None of the plaintiffs have prevailed in these recent cases.
Continue Reading The Game Goes On: Sheppard Mullin Obtains Dismissal With Prejudice of Class Action Alleging Social Gaming Micro-transactions Constitute Illegal Gambling

Over the past decade, the gaming industry has evolved into one of the hottest sectors of mobile internet services.  VentureBeat recently reported that in the trailing twelve months of Q3 2014, gaming accounted for $18 billion in trade exits and IPOs.  A prime example of this is Amazon’s acquisition of game-livestreaming startup Twitch for $970 million in August of this year. Gaming is also currently one of the more profitable parts of the mobile internet sector, boasting an average 9.9x return on a three year investment.
Continue Reading Investment Trends in the Gaming Industry

The Federal Trade Commission has recently focused its consumer protection efforts on the mobile arena, and particularly video game companies operating in that arena.

Early last year, the FTC issued several staff reports related to mobile commerce and gaming.  The reports (1) examined the use of mobile payments (see “Paper, Plastic… or Mobile?  An FTC Workshop on Mobile Payments”), (2) promoted improved privacy disclosures for mobile consumers (see “Mobile Privacy Disclosures, Building Trust through Transparency”) and (3) revised online advertising disclosure guidelines (see “.com Disclosures, How to Make Effective Advertising Disclosures in Digital Advertising”).  As with all FTC guidance, such reports do not represent the law.  However, the reports do create safe harbors for companies that want to avoid FTC scrutiny.


Continue Reading The FTC Continues Its Focus on the Mobile Arena

On April 15,[1] Georgia passed a law[2] amending its tax code to provide a limited tax credit to qualified interactive entertainment companies. The law provides incentives for mid-size game developers who demonstrate sufficient ties to Georgia. Qualified interactive entertainment companies are those that:
Continue Reading Georgia’s Limited Tax Credits for Interactive Entertainment Producers

This blog entry, which focuses on the Google Play Developer Distribution Agreement, is the first of two articles geared at helping app developers understand the fine print of the agreements they are asked to enter into with the companies that distribute their products. Following later this year, the second installment will focus on the iOS Program Developer Program License Agreement.
Continue Reading Bargaining with the Little Green Robot: Understanding the Google Play Developer Distribution Agreement [1]

Video games and feature films have a lot in common. Both tell stories and have exciting visuals and music. Although one is "interactive", recent Blu-ray HD discs are now turning linear films into more immersive, interactive experiences. Rights and talent deals for both have likewise followed a path towards convergence with terms and consideration often being negotiated and drafted the same way. Nowhere is this trend more obvious than the increasing popularity of product placement in enhancing the economic value of video games by making the game play more realistic while providing increased marketing value and good will by allowing the game developer and product owner, generally at no out-of-pocket cost, to reach new audiences.


Continue Reading Branded: Product Placement and Video Games