About chips, cards and pirates

by | Jun 25, 2018

What is the legality of circumvention devices (mod chips, flash cards, game copiers) for video games and consoles in Europe (and around the world)?

At the center of this global topic is the interaction between the creator of the video game and its user (the gamer). Producers in the gaming industry apply technological protective measures (TPM) to ‘lock’ their creative work and prevent counterfeit or “pirate” copies of games from being played on their consoles. A wide range of TPM such as electronic watermarks, encryption, specific log-in procedures or password codes are set into place against unauthorized use.

Players might see things slightly different: paying the price for the console would give them the right to use the product as they wish, even playing pirated games. In the EU, video games are obviously software (Computer Program Directive 2009/24) which opens the door for the user to alter or even reverse engineer the program. But a game is more than just a computer program: there is also some part of literary, audio-visual and or musical work (‘complex intellectual work’) covered by copyright protection. Despite opinions from the AG on EU level, domestic courts tend to assess the principles differently.

A landmark case in the United Kingdom is Sony v. Ball (2004)

Sony’s CDs and DVDs containing the software to run the PlayStation2 (PS2) games consoles have encrypted data embedded. Without the encrypted data, the consoles will not allow the software to be used. The defendants were involved in the design, manufacture, sale and installation of an electronic chip, called Messiah 2, bypassing the TPM. Sony stated that these activities constitute breaches of its copyrights. The defendant argued that he could not be held liable as the ‘mod chip’ was not used to make infringing copies.

A mod chip – modification computer chip – is a small electronic device used to modify or disable built-in restrictions of video game consoles. It simplifies gaming piracy by allowing the players access to unauthorized copies of games leaving the console to mistakenly assume that the player owns an authentic, licensed copy of the game.

According to the defendant the ‘sole intended purpose’ of the mod chip was not to circumvent the copy-protection mechanism, but rather to allow making back-up copies and playing games from other regions.

This case is landmark because it confirmed the illegality of manufacturing and dealing in mod chips. In addition, the defendant was held liable and could not escape invoking lack of knowledge of the infringing use.

In 2008, a judge in the Netherlands reflected on the same problem of legality of mod chips and flash cards in the Nintendo v. Webwinkels case.

When both copyright protection and software protection can be invoked, the deciding factor should be which element of the copyright protected work prevails (software or the audiovisual art work).

In 2008, a judge in the Netherlands reflected on the same problem of legality of mod chips and flash cards in the Nintendo v. Webwinkels case.

When both copyright protection and software protection can be invoked, the deciding factor should be which element of the copyright protected work prevails (software or the audiovisual art work).

Nintendo based its action on the principle that circumvention of ‘effective technological measures’ is prohibited. The defence argued that Nintendo described its games as ‘video game software’ in the writ of summons, but the judge did not follow this reasoning. Nintendo games are not only software but also works in the meaning of audiovisual works protected by the Dutch copyright law.

Also the Nintendo games consoles are designed for playing Nintendo games, not for playing music files or other use on the internet.

The judge found that the cards are intended exclusively for playing unauthorized pirated copies of the Nintendo games. As a result, Nintendo could confiscate and destroy all the mod chips and flashcards from the online stores.

In Germany, the World of Warcraft I case (2016) concentrated the discussion on the interaction between copyright on software, copyright licensing and the more general principles of contract law.

Games are often operated with so-called ‘end user license agreements’ (EULA). For World of Warcraft, the computer game manufacturer explicitly mentions in its EULA that rights of use granted would be revocable and not transferable. The EULA for the Daiblo III game, involved in the same case, also prohibits the use of ‘bots’. Bots are computer programs to enable the player to develop his game character in an easy and fast way.

The claims brought before the Bundesgerichtshof (Federal Supreme Court) concerned the issue of unauthorised duplication of the computer games in the field of copyright law.

The Federal Supreme Court states that gaming software consists not only of a computer program but also of audiovisual ‘game data’ (graphics, music and text) and film sequences. But by mentioning ‘duplication of client software’ in its judgment, the Court is not very clear on which right is to be applied to which component of the computer game. In this post, we focus on three cases where infringement was accepted. Feel free to compare case law in a broader search with the keywords ‘computer game / video game’ combined with the POL ‘infringement’ in our copyright database. You will find that surprisingly mod chips have been held lawful for instance in Spain and Italy.

Cases referenced in this post:

Sony v. Ball: Darts-IP internal reference: uk-2004-ewhc-1738-ch_20040719

Nintendo v. Webwinkels: Darts-IP internal reference: nl-HA-ZA-08-3879_20100721

World of Warcraft II: Darts-IP internal reference: de-I_ZR_25_15_20161006

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