Super-Grokster: Untangling Secondary Liability, Comic Book Heroes and the DMCA, and a Filtering Solution for Infringing Digital Creations

Fordham Intellectual Property, Media and Entertainment Law Fordham Intellectual Property, Media and Entertainment Law

Journal Journal

Volume 16

Volume XVI

Number 3

Volume XVI Book 3

Article 9

2006

Super-Grokster: Untangling Secondary Liability, Comic Book Super-Grokster: Untangling Secondary Liability, Comic Book

Heroes and the DMCA, and a Filtering Solution for Infringing Heroes and the DMCA, and a Filtering Solution for Infringing

Digital Creations Digital Creations

Britton Payne

Fordham University School of Law

Follow this and additional works at: https://ir.lawnet.fordham.edu/iplj

Part of the Entertainment, Arts, and Sports Law Commons, and the Intellectual Property Law

Commons

Recommended Citation Recommended Citation

Britton Payne,

Super-Grokster: Untangling Secondary Liability, Comic Book Heroes and the DMCA, and a

Filtering Solution for Infringing Digital Creations

, 16 Fordham Intell. Prop. Media & Ent. L.J. 939 (2006).

Available at: https://ir.lawnet.fordham.edu/iplj/vol16/iss3/9

This Note is brought to you for free and open access by FLASH: The Fordham Law Archive of Scholarship and

History. It has been accepted for inclusion in Fordham Intellectual Property, Media and Entertainment Law Journal

by an authorized editor of FLASH: The Fordham Law Archive of Scholarship and History. For more information,

please contact tmelnick@law.fordham.edu.

Super-Grokster: Untangling Secondary Liability, Comic Book Heroes and the Super-Grokster: Untangling Secondary Liability, Comic Book Heroes and the

DMCA, and a Filtering Solution for Infringing Digital Creations DMCA, and a Filtering Solution for Infringing Digital Creations

Cover Page Footnote Cover Page Footnote

like to thank Professor Hugh Hansen for helping me mold and re>ne this Note, Professor Jay Kogan for

his insights into the issues, Ashok Chandra, Hazel Malcolmson and Dick Grayson for their comments and

help. I would also like to thank my friends and family, especially my wife Tara Higgins.

This note is available in Fordham Intellectual Property, Media and Entertainment Law Journal:

https://ir.lawnet.fordham.edu/iplj/vol16/iss3/9

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939

Super-Grokster: Untangling Secondary

Liability, Comic Book Heroes and the

DMCA, and a Filtering Solution for

Infringing Digital Creations

Britton Payne

INTRODUCTION ............................................................................ 941

I. HOW DID WE GET TO GROKSTER?......................................... 945

A. A DASH OF COPYRIGHT HISTORY.................................... 946

B. BREYER’S GROKSTER ANALYSIS PROVIDES TOO LITTLE

INTELLECTUAL PROPERTY PROTECTION.......................... 948

C. GINSBURG’S GROKSTER ANALYSIS LEAVES LOOPHOLES

IN INTELLECTUAL PROPERTY PROTECTION, AND IS NOT

PROTECTIVE ENOUGH OF TECHNOLOGY ......................... 950

II. SUPERHEROES ........................................................................ 952

A. A VERY BRIEF HISTORY OF SUPERHEROES ...................... 952

B. PROTECTING COMIC BOOK CHARACTERS ....................... 954

C. CITY OF HEROES VIDEO GAME: A METROPOLIS

WITHOUT SUPERMAN ..................................................... 955

D. M

ARVEL BATTLES THE INFRINGERS................................. 957

III. M

ARVEL SUES NCSOFT AND CRYPTIC ON INFRINGEMENT

THEORIES............................................................................... 959

IV. THE INFRINGEMENT-ENABLING PUZZLE ................................ 960

J.D. candidate, Fordham University School of Law, 2007; B.A., American Studies with

Theater Studies, Yale University, 1992. I would like to thank Professor Hugh Hansen for

helping me mold and refine this Note, Professor Jay Kogan for his insights into the

issues, Ashok Chandra, Hazel Malcolmson and Dick Grayson for their comments and

help. I would also like to thank my friends and family, especially my wife Tara Higgins.

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A. OPERATORS OF MMORPGS APPROPRIATELY FALL

WITHIN THE SCOPE OF THE DMCA................................. 961

B. THE INDUCEMENT TO INFRINGE IN CITY OF HEROES

DOES NOT RISE TO THE LEVEL OF A VIOLATION UNDER

GROKSTER ..................................................................... 964

C. THE INTERSECTION OF SONY AND NOTICE AND

KNOCKDOWN ................................................................. 967

D. STRICTLY INTERPRETED NOTICE AND KNOCKDOWN

DOES NOT PROVIDE ADEQUATELY PROTECT

V. INFRINGEMENT IN THE MILIEU OF SUPERHEROES................... 971

A. SUPERHERO INFRINGEMENT CASES................................. 972

1. 1941: Wonderman: Closely Imitating the

Costume ................................................................. 972

2. 1942: The Lynx with Blackie the Mystery

Boy: A Comparison of the Cartoons...................... 973

3. 1951: Shazam!: It Takes Scarcely More than a

Glance.................................................................... 974

4. 1980: Manta and Superstretch: Trademark

Protection for Superhero Ingredients.................... 976

5. 1984: Super Stud and Wonder Wench: Seven

Costume Elements are Enough.............................. 978

6. 1983: Greatest American Hero: Visual

Impression is Dominant; Powers are

Copyrightable!....................................................... 979

7. 2000: Flex Mentallo: Parody Can Protect

Obvious Copying of a Character........................... 982

8. 2000: Black Nova: Fully realized.......................... 984

9. 2004: Medieval Spawn: Appearance is

Everything.............................................................. 986

B. WHEN COMPARING SUPERHEROES, LOOK AT NAMES,

COSTUMES AND TEXT, NOT POWERS OR PLOTS ............... 987

C. THE CITY OF HEROES USER-CREATED CHARACTERS

DIRECTLY INFRINGE....................................................... 989

D. C

ITY OF HEROES IMPLICATES DIRECT INFRINGEMENT

THROUGH

JOINT OWNERSHIP ......................................... 991

E. SKINS: IMPORTING A SUPERHERO COSTUME ................... 992

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F. THE SUPER HERO AND SUPER VILLAIN TRADEMARKS

SHOULD BE GENERIC ..................................................... 995

VI. A

FAIR FILTERING SOLUTION ................................................ 999

A. C

ALIBRATING NOTICE AND KNOCKDOWN FOR

CONTINUING RELATIONSHIPS ....................................... 1000

B. NAME: THE TRADEMARK STRING SOLUTION.................. 1001

C. APPEARANCE: THE ROY G. BIV 7% SOLUTION .............. 1002

D. POWERS: SCÈNES À FAIRE ............................................ 1004

E. COST WILL KEEP MARVEL FROM PROTECTING MORE

THAN ITS

BIGGEST CHARACTERS ................................... 1006

VII.THE SONY STANDARD IS OBSOLETE: THE ENABLING

TECHNOLOGY THEORY OF SECONDARY LIABLITY ............... 1007

A. SQUARING GROKSTER, SONY, AND SECONDARY

LIABILITY FOR COPYRIGHT INFRINGEMENT ................... 1007

B. PRESUMPTION OF LIABILITY FOR INTELLECTUAL

PROPERTY TRANSFER ENABLERS................................... 1009

C. BIFF BALANCING TEST ................................................ 1010

1. Budding Technology............................................ 1010

2. Infringing and Non-Infringing Use...................... 1011

3. Foreseeable Infringement .................................... 1012

4. Filtering................................................................ 1013

D. NCSOFT AND CRYPTIC FAIL THE BIFF TEST................. 1013

CONCLUSION.............................................................................. 1015

NTRODUCTION

City of Heroes, an online superhero video game, allows its

users to create their own characters, including many that infringe

copyrights.

The game, created by NCsoft and Cryptic Studios,

has been in use for about two years

and has earned tens of

See infra Part I.C.

See Quentin Hardy, Ordinary Hero, FORBES, Oct. 4, 2004, at 100, available at

http://www.forbes.com/forbes/2004/1004/100_print.html. The game was launched in

April 2004 and it is March 2006 as of this writing. See id.

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millions of dollars.

Marvel, the owner of many of the infringed

characters, has licensed them for exclusive use in authorized video

games and other media for over two decades,

and has earned

billions of dollars.

Marvel sued the game-makers for both direct

and secondary infringement.

This case ultimately would have addressed the question left

unanswered by the limited Grokster holding—absent inducement,

“under what circumstances [is] the distributor of a product capable

of both lawful and unlawful use . . . liable for acts of copyright

infringement by third parties using the product[?]”

As of

December 14, 2005, the parties in Marvel v. NCsoft have settled

their dispute, leaving this billion-dollar question of secondary

liability unresolved for future Internet Service Providers (“ISPs”).

This Note offers a resolution to the problem of character

infringement in online video games with the BIFF Factors,

the

String Solution

and the 7% Solution

that will apply wherever a

technology enables its users to infringe copyright.

See id. (noting that as of October 2004 “City of Heroes . . . has 180,000 users, adding

6,000 more newcomers every week. They pay $50 up front and $15 a month” for a total

of $9 million in upfront fees and $2.7 million more per month). NCsoft revenues

attributed to City of Heroes were approximately $6.1 million for the quarter ending

September 30, 2005. See Press Release, NCsoft, NCsoft Announces Third Quarter

Financial Results, (Nov. 5 2005), available at http://www.ncsoft.com/eng/

NCPress/View.asp?hSeq=1) (announcing that City of Heroes brought in revenues of

6.4 billion in Korean Won (KRW), which, with a ratio of 1 United States dollar (USD) to

1,043 KRW, is $6.1 million USD).

See Chad Mullikin, The History of Marvel Video Games, XBOX ADVANCED, Sept. 19,

2005, http://xbox.advancedmn.com/article.php?artid=5792.

See infra note 119 and accompanying text.

Complaint, Marvel Enters., Inc. v. NCsoft Corp., Case No. CV 04-9253-RGK

(PLAx) 9–16 (C.D. Ca. Nov. 10, 2004) [hereinafter Marvel Complaint].

Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 125 S. Ct. 2764, 2770 (2005).

Press Release, NCsoft, Marvel Entertainment, Inc., NCsoft Corporation, NC

Interactive, Inc., Cryptic Studios, Inc. Settle All Litigation, (Dec. 14, 2005), available at

http://www.plaync.com/about/2005/12/marvel_entertai.html; Matt Brady, Marvel Settles

With NCsoft/Cryptic Studios, N

EWSARAMA.COM, http://www.newsarama.com/

forums/showthread.php?s=d8c3b41999a4c0193955aa5e93de62c3&threadid=52452 (last

visited Dec. 20, 2005).

See infra Part VII.C.

See infra Part VI.B.

See infra Part VI.C.

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It is important that the courts find a balance between the

fostering of new technologies and the protection of intellectual

property.

Our legal system must address digital encroachments

that threaten to overwhelm the ability of intellectual property

companies to protect their billion-dollar investments. It must also

prevent important new technological developments from being

trampled in a rush to protect copyright owners. Without firm and

clear guidance from the courts in cases like Marvel v. NCsoft, we

will see an irreversible erosion of not only the business models of

America’s character companies, but our country’s ability to protect

our most valuable export: culture.

This Note proposes the implementation of a clear and effective

solution that acknowledges the responsibility of ISPs like NCsoft

and Cryptic to prevent or reduce infringing uses of their products.

Marvel’s claims depend on an understanding of when one

superhero infringes another, a matter discussed later in this Note.

The “capable of substantial noninfringing use[]” standard for

triggering safe harbor for non-induced third party infringements

articulated in Sony

needs to be revisited in light of the digital

revolution and the Digital Millennium Copyright Act of 1998

(“DMCA”),

and rearticulated or entirely reconstructed to provide

more practical guidance for companies at odds with each other

over the protection of intellectual property rights.

This Note will explore claims of copyright and trademark

infringement that arise when an internet company’s users pay to

create and play with characters that infringe on another character-

based company’s intellectual property rights. The issues that were

present in Marvel v. NCsoft provide ample opportunity to explore

problems that have persisted as digital technology has threatened

intellectual property interests—this Note offers a solution.

This note proposes that courts should solve problems in online

infringement through the congressionally considered mechanisms

of the DMCA, and use its injunctive relief liberally to craft

See Grokster, 125 S. Ct. at 2775.

See infra Part V.

Sony Corp. of Am. v. Universal City Studios, Inc., 104 S. Ct. 774, 789 (1984).

Pub. L. No. 105-304, 112 Stat. 2860 (1998).

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solutions as they arise. Over twenty years ago, a case involving

the awesome, futuristic video-cassette recorder (“VCR”) resulted

in safe harbor for enabling technologies

from contributory and

vicarious infringement claims where the product is “capable of

substantial noninfringing use[].”

Following this 5-4 decision,

paradoxically, the VCR and video rental industries became a boon

for the copyright owners who brought and lost the case.

However, this ham-fisted standard does not effectively protect the

interests of intellectual property companies like Marvel in the

digital age.

Because of the ways in which new technologies

emerge, the most efficient solution to a digital infringement

problem will place liability on the party most equipped to prevent

the violation: the technology company.

Congress laid out a

principled set of guidelines for dealing with these problems with

This Note uses “enablers” and “enabling technologies” to refer to companies and

products that facilitate users’ creation or consumption of intellectual property, thus

implicating copyright and trademark infringement by their users. The use of these terms

is in no way meant to suggest the presence of inducement, but merely the known

capabilities of the product. Although this Note largely discusses digital enablers, there

have been many enablers that came into existence prior to the emergence of digital

technology, such as Xerox, photography, cassette recorders and player pianos.

Sony, 104 S. Ct. at 789.

See id. at 777, 796.

See In re Aimster Copyright Litig., 334 F.3d 643, 650 (7th Cir. 2003). As Judge

Posner noted, “[a]n enormous new market thus opened for the movie industry[.]” Id. In

one notable example, Disney was reluctant to release their animated classics on video,

fearing decreased overall revenue because of the impact they felt home videos could have

on the septennial theatrical re-releases. CEO Michael Eisner predicted in 1984 that the

value of the entire Disney library in home video and cable TV markets was $200 million.

In 1988, the then-present value of four theatrical re-releases of Cinderella over 28 years

was estimated at $25 million. Disney’s revenue from the Cinderella home video release

came in at $180 million in its first year alone, and home video sales of their film library

rapidly became Disney’s second biggest profit center. See J

AMES B. STEWART, DISNEY

WAR 64, 91–93 (Simon & Schuster 2005).

Marvel’s intellectual property interests are not insubstantial. “By the late 1970’s, the

licensing of Marvel characters for merchandise had become a principal line of Marvel’s

business, . . . Spider-Man: The Movie, which was released in May, 2002, [earned] $800

million in worldwide box-office gross, . . . [yielding] more than $50,000,000 to

Marvel. . . . Marvel’s toy division alone reported over $100 million in sales of Spider-

Man: The Movie toys.” Lee v. Marvel Enters., Inc, 386 F. Supp. 2d 235 (S.D.N.Y. 2005).

DC Comics licensing of Superman “generated several billion dollars worth of income”

from 1969 to 1984. DC Comics Inc. v. Unlimited Monkey Business, Inc., 598 F. Supp.

110, 113 (N.D. Ga. 1984).

See Aimster, 334 F.3d at 646.

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the DMCA,

but its intended benefits will be frustrated and

delayed if those laws are interpreted narrowly. Congress must not

be expected to pass new legislation for each new twist on

infringing uses due to advances in technology. The courts are

much better prepared to craft solutions that deal with the problems

at hand and set out fact-specific solutions, so that resolutions can

be achieved despite the changing terrain of technological advances.

Only if the courts run too far afield of Congress’ wishes should

new legislation guide the determination of liability for third-party

infringements online. Until then, courts should endeavor to solve

the problems that come before them using the tools Congress has

provided, rather than search for reasons to dodge the task of

crafting a solution.

The courts should set out clear guidelines for interpreting the

standards of the DMCA in facilitating copyright infringement

remedies and replace the unclear and outmoded Sony rule, which

looks to whether the product is “capable of substantial

noninfringing uses.”

enablers need to know their rights and responsibilities more clearly

than they do today. Marvel v. NCsoft provided an opportunity for

the courts to clarify these uncertainties and to present strong

guidance that would keep many similar infringement cases out of

the courts and solved instead by the self-regulating aspects of the

DMCA. In the wake of the settlement, an exploration of the issues

presented by the case will clarify the pressures emerging with the

evolving nature of ISPs, demonstrate the need to alleviate the

uncertainties that still exist post-Grokster, and provide guidance

for the inevitable case that will pit an intellectual property owner

against an ISP that enables infringement.

I. H

OW DID WE GET TO GROKSTER?

Grokster is only one of the latest cases attempting to balance

the interests of creators protecting their works and the

constitutionally mandated public interest in the advancement of

See 17 U.S.C. § 512 (2000); see also infra Part IV. for further discussion.

Sony, 104 S. Ct. at 789.

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technology.

“The more artistic protection is favored, the more

technological innovation may be discouraged; the administration

of copyright law is an exercise in managing the trade-off.”

order to understand what should follow Grokster, it is helpful to

take a look into what came before.

A. A Dash of Copyright History

Intellectual property was first protected in the West by the

Statute of Anne in 1710.

Printers were worried that they would

not be able to protect their investments in printing without some

kind of monopoly on the material they published.

To address this

concern, the British government stepped in and granted writers a

monopoly on their works, as long as they complied with certain

procedures.

This prevented others from using that same work to

make money, unless they were willing to work out a deal with the

principles and first federalized copyright protection in the United

States, granting authors the sole right to control the use of their

works.

The Act was given a major revision in 1909, in response

to authors’ inability to adequately protect their rights under the old

regime.

The modern copyright regime was introduced with the

next major revision, the Copyright Act of 1976, in which the U.S.

Id. at 782 (noting that “[f]rom its beginning, the law of copyright has developed in

response to significant changes in technology”). “The Congress shall have Power . . . To

promote the Progress of Science and useful Arts, by securing for limited Times to

Authors and Inventors the exclusive Right to their respective Writings and

Discoveries[.]” U.S. C

ONST. art. I, § 8, cl. 8.

Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 125 S. Ct. 2764, 2775 (2005).

8 Anne c.19 (1710), reprinted in 8 MELVILLE B. NIMMER & DAVID NIMMER, NIMMER

See CRAIG JOYCE, ET AL., COPYRIGHT LAW 15–16 (5th ed. 2001).

8 Anne c. 19 § 1 (1710), reprinted in 8 MELVILLE B. NIMMER & DAVID NIMMER,

NIMMER ON COPYRIGHT app. 7 § A (Matthew Bender 2005) (1963); JOYCE ET AL., supra

note 26, at 16.

See Gregory S. Schienke, The Spawn of Learned Hand—A Reexamination of

Story Be Told?, 9 M

ARQ. INTELL. PROP. L. REV. 63, 65 (2005), (citing Act of May 31,

1790, ch. 15, 1 Stat. 124, reprinted in 8 M

ELVILLE B. NIMMER & DAVID NIMMER, NIMMER

See The Copyright Act of 1909 §§ 23–24, reprinted in 8 MELVILLE B. NIMMER &

DAVID NIMMER, NIMMER ON COPYRIGHT app. 6 (Matthew Bender 2005) (1963).

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made it even easier for authors to assert protection over their

works.

By the late 1990s, digital technology had become so

integrated into art, that perfect copies of music and images could

be transmitted instantly, making infringement of copyrighted

material easier than it had ever been, and leaving the guidelines of

the 1976 Act wanting.

The DMCA of 1998 addressed this new

technological reality and attempted to balance the need to protect

intellectual property holders with the need to foster the technology

that facilitated their transmission.

In Marvel’s action against

NCsoft and Cryptic, the protection Marvel sought hinged on the

interpretation of not only this legislation, but on what exactly

comprises contributory infringement and vicarious liability in a

digital medium. The question has been wrestled with in the courts

since the enactment of the DMCA—some decisions offering strong

protection for copyright holders, some protecting nascent

technology. However, the decisions only slowly chip away at

growing insecurity between intellectual property holders and ISPs

with regards to secondary liability.

A few years after the DMCA was passed, rights-holders of

music and movie properties went after companies that enabled

users to illegally share these properties. The Supreme Court

addressed this case in its 2005 Grokster decision, where they posed

the question “under what circumstances [is] the distributor of a

product capable of both lawful and unlawful use . . . liable for acts

of copyright infringement by third parties using the product[?]”

Decisions prior to the DMCA indicated that the substantiality of

the present and potential noninfringing use would determine the

liability based on the 1984 Sony decision, which addressed the

VCR phenomenon.

However, the Grokster Court unanimously

found contributory copyright infringement because the enablers

See Pub. L. 94-553, § 302(a), 90 Stat. 2541 (1976).

See Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 125 S. Ct. 2764, 2775

(2005) (comparing the analog technology implicated in Sony with the digital technology

of Grokster).

See In re Aimster Copyright Litig., 334 F.3d 643, 655 (7th Cir. 2003).

Grokster, 125 S. Ct. at 2770.

See Sony Corp. of Am. v. Universal City Studios, Inc., 104 S. Ct. 774, 789 (1984).

See accord, Religious Tech Center v. Netcom, 907 F.Supp 1361 (N.D. Cal. 1995).

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had actively induced infringing behavior.

The opinion

specifically left open the question of the standards to determine

secondary liability for copyright infringement, where the level of

inducement is not equivalent to that found in the Grokster case.

The two concurrences offered contradictory positions on that sub-

issue, as discussed below. Each interprets the “capable of

substantial noninfringing uses” standard set out in Sony to support

its finding.

B. Breyer’s Grokster Analysis Provides Too Little Intellectual

Property Protection

Sony’s “capable of substantial noninfringing uses” is so loose a

standard as to be illusory. The Breyer concurrence in Grokster

(joined by Justices Stevens and O’Connor) shows just how

malleable a standard it is.

Although the goal of protecting

nascent technologies is essential, using that goal as a decisive

factor in rebuffing a claim of contributory infringement will almost

always cause infringement enablers to elude responsibility for their

actions, under Justice Breyer’s reading. In Marvel v. NCsoft, a

Breyer reading of Sony would mean that Marvel would have no

right to seek any relief from NCsoft and Cryptic, absent a finding

of inducement, and would be forced to inefficiently protect its

properties by asserting claims against one infringing user at a

time.

These “John Doe lawsuits”

offer no meaningful

protection at all.

Grokster, 125 S. Ct. at 2770. The unanimous decision in Grokster held that a

distributor of file-sharing software is liable for its users’ copyright violations that were

actively enabled, intended and induced through the company’s business plan and

advertisements. Id.

See id. at 2776.

See infra notes 41–43 and accompanying text.

See Grokster, 125 S. Ct. at 2791–93.

When a widely shared service or product is used to commit infringement, it

may be impossible to enforce rights in the protected work effectively against all

direct infringers, the only practical alternative being to go against the

distributor of the copying device for secondary liability on a theory of

contributory or vicarious infringement.

See also id. at 2776 (citing In re Aimster Copyright Litig., 334 F.3d 643, 645–46 (7th Cir.

2003)).

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Justice Breyer wrote to agree with the Ninth Circuit’s

interpretation of Sony that, absent inducement, the barest

inclination of a potential non-infringing use would render the

producer of an enabling technology not subject to liability for its

users’ infringements.

The reasoning he followed interpreted the

Sony standard to measure “substantial noninfringing uses” at

approximately nine percent, and that only included then-present

uses.

He then found Grokster to have a comparable present rate

of ten percent noninfringing use, and a now-unforeseen, nearly

magical future capability for noninfringing uses.

Similarly, the

evidence available in Marvel v. NCsoft easily passes the Sony

standard as interpreted by Justice Breyer, that the noninfringing

uses constitute at least ten percent of all uses.

Most City of

Heroes users do not play infringing characters.

However, even a

small percentage of infringing use can still account for a large

number of infringing uses and substantially affect the bottom line

of the copyright holder. Marvel has the right to make an exclusive

Massively Multi-Player Online Role Playing Game (“MMORPG,”

pronounced “morg”) deal for its characters, but it cannot

meaningfully do so if its characters are running around City of

Heroes.

Justice Breyer’s reading of Sony provides ample

protection for nascent technologies, but similarly protects mature

technologies to the unacceptable detriment of intellectual property

holders. Justice Ginsburg’s concurrence addresses this deficiency,

but swings too far in the other direction.

See Elektra Entm’t Group, Inc v. Does 1–9, No. 04 Civ. 2289, 2004 WL 2095581

(S.D.N.Y. Sept. 8, 2004); Order and Attachment, Elektra Entm’t Group, Inc. v. Does 1–6,

Civ. No. 04-1241 (E.D. Pa. Oct. 13, 2004), available at http://www.eff.org/IP/P2P/

RIAA_v_ThePeople/20041012_Order_Granting_Request.pdf; see also John Doe

Lawsuits, Electronic Frontier Foundation, http://www.eff.org/IP/P2P/riaa-v-

thepeople.php (last visited Nov. 26, 2005).

See Grokster, 125 S. Ct. at 2787–88 (Breyer, J., concurring).

See id. at 2788–89.

See id at 2789–90.

See id.

See, e.g., City of Heroes, City of Heroes Fan Site, City of Hero Screenshots,

http://www.saguisag.com/column/cityofheroes/ (click on individual calendar dates to see

images of heroes created for and used in the City of Heroes game) (last visited

Jan. 1, 2006).

See Seth Schiesel, Microsoft Joins Marvel in Online Game Deal, N.Y. TIMES,

July 15, 2005, at C2.

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C. Ginsburg’s Grokster Analysis Leaves Loopholes in Intellectual

Property Protection, and Is Not Protective Enough of

Technology

Looking only to present substantial non-infringing use, as the

Ginsburg concurrence does, is also too forgiving to be a useful

standard. Absent inducement, the Ginsburg concurrence in

Grokster (joined by Chief Justice Rehnquist and Justice Kennedy)

would have found the company liable for contributing to the

infringement of its users. The “ten percent” Justice Breyer wrote

of was interpreted by Justice Ginsburg as “little beyond anecdotal

evidence of noninfringing uses.”

However, the Ginsburg

concurrence did not indicate a willingness to find liability where

the infringing use was less than “overwhelming.”

As articulated,

Justice Ginsburg’s standard would not protect against

infringements that constitute a small, or unknowable, percentage of

the overall use of the technology, even if they occur in significant

numbers.

If an infringement is significant enough to merit the

expense of pursuing a claim, rights holders should not be rebuffed

simply because the infringement is not particularly important to the

enabler. As iPods merge with cell phones

and PCs mirror TVs,

consolidation of technologies will make a singular percentage-use

analysis as obsolete has having a separate knife, scissors, awl,

corkscrew and toothpick in your hunting belt.

Concurrently, the Ginsburg analysis does not adequately

protect nascent technology. Justice Ginsburg’s interpretation of

the Sony standard determines a technology’s capable uses by

looking no further than to its present uses.

New technologies

See Grokster, 125 S. Ct. at 2785 (Ginsburg, J., concurring).

See id. at 2786.

See id.

See, e.g., Motorola ROKR, http://direct.motorola.com/ENS/web_producthome.asp?

Country=USA&language=ENS&productid=29790 (last visited Feb. 6, 2006).

See, e.g., Saul Hansell, Google and Yahoo Aim at Another Screen, N.Y. TIMES,

Jan. 6, 2006, at C1; John Markoff, Coming Soon to TV Land, N.Y. T

IMES, Jan. 7, 2006, at

C1; Wikipedia, Liquid Crystal Display, http://en.wikipedia.org/wiki/LCD (last visited

Nov. 29, 2005).

See Grokster, 125 S. Ct. at 2783–84, (Ginsburg, J., concurring).

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might be based on infringement, but might also have the potential

to be a useful and non-infringing technology, just as a writer might

evolve a copyrighted storyline until it becomes a sufficiently

original and non-infringing work.

The Ginsburg analysis would

hold a company liable in its beginning stages, before it has a

chance to fully develop its technology into a useful and ultimately

noninfringing purpose.

By looking exclusively to the percentage

of present noninfringing use, the Ginsburg standard shortsightedly

does not provide for a company that has yet to reach a plateau of

use before burdening it with the risk of third-party copyright

liability.

To adequately protect both intellectual property rights, such as

Marvel’s, and the development of the useful technology, like that

employed by NCsoft and Cryptic, at the very least a more balanced

interpretation of the Sony standard is needed than is articulated in

any of the Grokster opinions. A better solution is to more fully

articulate the principles at play in Sony and the Grokster

concurrences by establishing a new standard that incorporates all

three and creates workable guidelines that fully address both

technology and intellectual property concerns. Marvel v. NCsoft

offers a look at an important and discrete situation in which a new

See, e.g., Sapon v. DC Comics, 00 Civ. 8992, 2002 U.S. Dist. LEXIS 5395, at *19–

20 (S.D.N.Y. Mar. 29, 2002) (citing, e.g., Silverman v. CBS, Inc., 870 F.2d 40, 49 (2d

Cir. 1989) (using the phrase “incremental addition”)). “Professor Nimmer

recognizes . . . that ‘a defendant may legitimately avoid infringement by intentionally

making sufficient changes in a work which would otherwise be regarded as substantially

similar to that of the plaintiff’s,’ a proposition we recognized on the prior appeal of this

case, and elsewhere.” Warner Bros. v. Am. Broad. Cos. 720 F.2d 231, 241 (2d Cir. 1983)

(internal citations omitted).

[E]vidence of intentional copying raises a presumption that a second comer

intended to create a confusing similarity of appearance and succeeded. But if

comparison of the works reveals no fair jury issue concerning likelihood of

confusion, then intent to copy, even if found from the proffered evidence,

would not establish a Lanham Act violation.

Id. at 246–47 (internal citations omitted) (citing B & L Sales Assocs. v. H. Daroff &

Sons, Inc., 421 F.2d 352, 354 (2d Cir. 1970); Mastercrafters Clock & Radio Co. v.

Vacheron & Constantin-le Coultre Watches, Inc., 221 F.2d 464, 466-67 (2d Cir. 1955);

Vitarroz Corp. v. River Brand Rice Mills, Inc., 266 F. Supp. 981, 986 (S.D.N.Y. 1967)).

See Grokster, 125 S. Ct. at 2791–96 (Breyer, J., concurring) (discussing the “chill of

technological development”).

See id.; see also infra Part VII.C.1.

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technology allows users to infringe on copyright to the significant

detriment of the rights-holders, but does allow for availment of the

protections afforded by Grokster and Sony, necessitating a new

standard.

II. SUPERHEROES

In order to fully discuss the issues at play in Marvel v. NCsoft,

it is necessary to look into the discrete milieu of superheroes—a

form of intellectual property that has earned billions of dollars and

has successfully adapted its specific subset of character properties

into emerging entertainment technologies.

A. A Very Brief History of Superheroes

Superheroes as we know them were first created in the 1930s.

Drawing inspiration from literary characters like Hercules,

Zorro,

and the Scarlet Pimpernel,

and real-life circus

performers and daredevils,

the first brightly-clad, crime-fighting

superheroes were seen in the pages of comic books.

They have

since been featured in every milieu that could hold an image or tell

a story: toys, clothing, food packaging, radio, television, movies,

and more recently, video games.

Although “Super Hero” and “Super Villain” are part of

common parlance, they are actually trademarked terms held jointly

by the two biggest American comic book publishers.

DC Comics

See LES DANIELS, SUPERMAN: THE COMPLETE HISTORY passim (1st paperback ed.,

Steve Korté ed., Chronicle Books 2004) (1998) [hereinafter D

ANIELS: SUPERMAN].

See LES DANIELS, CHIP KIDD & GEOFF SPEAR, THE GOLDEN AGE OF DC COMICS: 365

DAYS 4 (2004) [hereinafter DANIELS: GOLDEN AGE].

See Detective Comics, Inc. v. Bruns Publ’ns, Inc., 111 F.2d 432, 433 (2d Cir. 1940).

See Redboots, Secret Identity: And who, disguised as Clark Kent . . . ,

http://www.redboots.net/comics/secret_identity.htm (last visited Nov. 29, 2005).

See GERARD JONES, MEN OF TOMORROW: GEEKS, GANGSTERS, AND THE BIRTH OF THE

COMIC BOOK 116 (Basic Books 2004).

See Redboots, Secret Identity: And who, disguised as Clark Kent . . . ,

http://www.redboots.net/comics/ powers_costume.htm (last visited Nov. 29, 2005).

See DANIELS: SUPERMAN, supra note 56, 18–22.

See id., passim.

Word Mark SUPER HEROES, Serial No. 73222079 (1981); available at

http://www.uspto.gov/main/trademarks.htm (select “Search Trademarks” under “Get a

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counts in its vast roster of characters Superman, Batman and

Robin, Wonder Woman, Captain Marvel (Shazam!), Green

Lantern, Aquaman, Plastic Man and the Flash, among many

others.

Marvel Comics started as Timely Comics in the 1930s,

when it published Captain America, the Human Torch, and Sub-

Mariner comic books.

The company changed its name and

reinvigorated the genre in the 1960s,

with its tragic heroes

Spider-Man, the Fantastic Four, the Incredible Hulk, and the X-

Men as part of its developing cast of thousands of costumed

characters.

Both companies have published or licensed their

superheroes to earn billions of dollars over the last seventy years,

and they protect their intellectual property rights in the characters

assiduously.

Trademark Registration”; then select “New User Form Search” and enter the term “super

heroes” into the “Search Term” box; then select the trademark with the corresponding

serial number). DC Comics and Marvel have co-owned these terms since 1981. See

Brian Cronin, Comic Book Urban Legends Revealed #9!, C

OMICS SHOULD BE GOOD,

July 28, 2005, http://goodcomics.blogspot.com/2005/07/comic-book-urban-legends-

revealed-9.html; see also infra Part V.F. and accompanying notes.

See SCOTT BEATTY ET AL., THE DC COMICS ENCYCLOPEDIA: THE DEFINITIVE GUIDE

TO THE

CHARACTERS OF THE DC UNIVERSE passim (Alastair Dougall, ed., DK Publishing,

Inc. 2004).

Wikipedia Marvel Comics, http://en.wikipedia.org/wiki/Marvel_Comics (last visited

Dec. 1, 2005); see RON GOULART, GREAT HISTORY OF COMIC BOOKS 145–58

(Contemporary Books, Inc. 1986).

See Donald D. Markstein, Marvel Comics, TOONOPEDIA.COM,

http://www.toonopedia.com/marvel.htm (last visited Dec. 1, 2005) (“Marvel Comics may

have been the name of the comic (for one issue, anyway—with #2, it became Marvel

Mystery Comics), but it wasn’t the name of the publisher. In fact, there wasn’t any one

name the publisher was known by for any great length of time until the 1950s, when, for

several consecutive years, it used “Atlas” as an imprint. It put a “Marvel Comics” logo

on its covers for a couple of brief periods in the late ‘40s, but didn’t assume that name

once and for all until 1963. Among the dozens of company names it used over the years

was “Timely.”); see also B

RADFORD W. WRIGHT, COMIC BOOK NATION: THE

TRANSFORMATION OF YOUTH CULTURE IN AMERICA 212 (Johns Hopkins University Press

2001) (discussing the impact of Marvel Comics’ comic books on the industry).

WRIGHT, supra note 67, at 204–15.

See DANIELS: SUPERMAN, supra note 56, passim. Merchandising and licensing

account for over 70% of Marvel’s annual income. See Second Amended Complaint,

Marvel Enters., Inc. v. NCsoft Corp., No. CV 04-9253-RGK (PLAx) 5 (C.D. Ca. Jan 25,

2005) [hereinafter Marvel Second Amended Complaint].

See, e.g., infra Part V.A. They protect their rights with good reason. For example,

DC Comics strictly adheres to its policy of taking great care in the selection of licensees

who will responsibly utilize and promote the Superman character, costumes, phrases,

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B. Protecting Comic Book Characters

Apart from the stories that detail their adventures, superheroes

and other characters themselves are protected under both copyright

and trademark principles.

Unauthorized use of characters from

one work can lead to copyright violation when used in another.

Common superhero phrases that started as copyrightable text have

subsequently been trademarked, such as “up, up and away”

and

“faster than a speeding bullet.”

These and other aspects of

superheroes are protected by trademark law to the extent that they

confuse consumers as to their source.

Intellectual property rights holders are threatened any time a

new communication technology comes along—and the Internet

was no exception.

Fears over digital transmission through wide-

reaching and inexpensive worldwide web channels through the

mid-1990s led to the enactment of the DMCA.

Companies that

operated an ISP were concerned that they could be liable for

names and images, and has maintained strict quality requirements, to the tune of several

billion dollars between 1969 and 1985 alone. DC Comics Inc. v. Unlimited Monkey

Business, Inc., 598 F. Supp. 110, 113 (N.D. Ga. 1984).

See, e.g., Warner Bros., Inc. v. Am. Broad. Cos., Inc, 720 F.2d 231, 236 (2d Cir.

1983). See also Jay Kogan, Trademark Protection for “Identity” Elements of Characters

After Copyright Expires, N.Y.

ST. B.A. ENT., ARTS & SPORTS L.J. 26, 26 (Fall/Winter

2001) (explaining that “[c]haracters are entitled to protection under both copyright and

trademark and related doctrines”).

See, e.g., Walt Disney Prods. v. Air Pirates, 581 F.2d 751 (9th Cir. 1978).

Word Mark FASTER THAN A SPEEDING BULLET, Serial Number 73722620

(1989), available at http://www.uspto.gov/main/trademarks.htm (select “Search

Trademarks” under “Get a Trademark Registration”; then select “New User Form

Search” and enter the term “faster than a speeding bullet” into the “Search Term” box;

then select the trademark with the corresponding serial number).

Word Mark UP, UP AND AWAY, Serial Number 73176950 (1979), available at

http://www.uspto.gov/main/trademarks.htm (select “Search Trademarks” under “Get a

Trademark Registration”; then select “New User Form Search” and enter the term “up, up

and away” into the “Search Term” box; then select the trademark with the corresponding

serial number); see Kogan, supra note 71, at 32 (discussing the protection of “Faster

Than A Speeding Bullet”).

See Kogan, supra note 71, at 27–28.

See, e.g., Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 380 F.3d 1154,

1158 (9th Cir. 2004).

See In re Aimster Copyright Litig., 334 F.3d 643, 655 (7th Cir. 2003).

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whom they had no meaningful supervision.

To address this

concern, the DMCA provides a safe harbor against a claim of

a website when notified by the copyright holder

(“Notice and

Knockdown”).

Comic book companies regularly use Notice and Knockdown

to combat illegal online profiting from their superhero properties,

but also appear to ignore certain benign uses that encourage

fandom.

For example, unauthorized tales of their superheroes

called fan fiction, or “fanfic,” written by professional writers, or

sold as if authorized by the copyright owner, are usually pursued

by the publisher.

Stories posted by amateurs for the pleasure of a

small community are not generally targeted.

The line seems to

be drawn at moneymaking.

C. City of Heroes Video Game: A Metropolis Without Superman

Seeking to take advantage of the online market for superhero

adventure, NCsoft and Cryptic Studios launched the superhero-

Id.

See id.; 17 U.S.C. § 512 (2000).

See 17 U.S.C. § 512 (2000). This section is the notice-and-takedown provision,

more pleasantly alliterative when referred to as “Notice and Knockdown.” “Notice-and-

takedown” phrase is used in Rossi v. Motion Picture Ass’n of Am., Inc., 391 F.3d 1000,

1002 (9th Cir. 2004); Yijun Tian, Problems of Anti-Circumvention Rules in the DMCA &

More Heterogeneous Solutions, 15 F

ORDHAM INTELL. PROP. MEDIA & ENT. L.J. 749, 779

(Spring 2005); Richard S. Whitt, A Horizontal Leap Forward: Formulating a New

Communications Public Policy Framework Based on the Network Layers Model, 56 F

ED.

COMM. L.J. 587, 613 (2003–2004).

See, e.g., Ruling on Marvel’s Motion to Dismiss Counterclaims, Marvel Enters., Inc.

v. NCsoft Corp., No. CV 04-9253-RGK (PLAx) 2–3 (C.D. Ca. Jan 25, 2005) [hereinafter

Ruling on Marvel’s Motion to Dismiss Counterclaims].

See Frequently Asked Questions (and Answers) about Fan Fiction, Stanford Center

for Internet & Society, http://www.chillingeffects.org/fanfic/faq.cgi#QID302 (last visited

Dec. 1, 2005). This site talks about movies and Star Trek, not comics, but the operating

principles are the same.

Id.

See Rik Offenberger, DarkMark: The Mark Waid of Fan Fiction, THE MIGHTY

CRUSADERS NETWORK, Apr. 19, 2005, http://www.mightycrusaders.net/darkmark.htm.

“[T]he powers that be could stop any of us with a word. There have been authors who

have asked that fanfic not be written about their stuff, and we’ve complied. On the other

hand, if you don’t make money from it and don’t kick up too much of a fuss, the owners

aren’t much bothered by it.” Id.

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themed MMORPG City of Heroes in April, 2004.

Cryptic, a

video game development studio, developed City of Heroes with

financial, distribution and back end support from the South Korean

video game company NCsoft.

Users create original superheroes

using a character generation feature called the “Creation Engine”

and share adventures with other players in the game’s virtual

city.

“Paragon City,” the eponymous city of heroes, also has a

“tailor” among its offices, courthouses and stores, which enables

accomplished game players to create variant or totally new

costumes for their characters mid-game, using features similar to

the Creation Engine.

It was promoted as a game that “brings the

world of comic books alive”

and “enables players to realize their

comic book dreams.”

Within a month, it had exceeded its break-

even subscriber number of 100,000.

Cryptic also began

publishing a print comic book series based on the game.

Cryptic’s intention was to create a game of superhero action

without having to license characters from comic book publishers.

The City of Heroes User Agreement forbids the user of the game

See Hardy, supra note 2, at 100.

See id.

See Ruling on Marvel’s Motion to Dismiss Counterclaims, supra note 81, at 1.

See Press Release, Play NC, City of Heroes Launches Issue 1: Through the Looking

Glass, June 30, 2004, http://www.plaync.com/about/2004/06/city_of_heroes_18.html.

(noting that “Icon, a company in the game’s fictional Paragon City, will make costume

and body modifications.”).

See, e.g., Judd Winick, Dusting Nguyen, Richard Friend & Alex Sinclair, As the

Crow Flies Part Two: Partners in Crime, B

ATMAN 627, at City of Heroes Advertisement

(DC Comics, Jun. 2004) (on sale Apr. 2004) [hereinafter City of Heroes Advertisement];

Marvel Second Amended Complaint, supra note 69, at 2.

Press Release, Play NC, NCsoft Launches City of Heroes Commercial Service:

Comic Book-Based Online Game Trailblazes New Territory (Apr. 28, 2004), available at

http://www.plaync.com/about/2004/04/ncsoft_launches_3.html [hereinafter Press

Release: City of Heroes Launch].

See Andrew S. Bub, City of Heroes, Issue #2 (PC), GAMESPYPC.COM, Aug. 19,

2004, http://pc.gamespy.com/pc/city-of-heroes/540482p1.html (interview with Kevin

Sullivan, NCsoft product marketing manager).

See Ruling on Marvel’s Motion to Dismiss Counterclaims, supra note 81, at 2; Rick

Dakan, Brandon Mckinney & Moose Bauman, Undead in the Big City Part 1, CITY OF

HEROES 1, at 1 (NCSoft Corporation and Cryptic Studios, Inc. Apr. 2004).

See Hardy, supra note 2 at 100; see User Agreement, City of Heroes, §§ 4(e), 6(d)

(July 2005), available at http://www.plaync.com/help/eula_coh.html (last visited Dec. 1,

2005) [hereinafter City of Heroes User Agreement].

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from infringing any copyrights.

The game also has a “Block

List” to prevent its players from using certain potentially infringing

or obscene character names.

D. Marvel Battles the Infringers

Despite these efforts by Cryptic, users created superheroes that

infringed on the intellectual property rights of Marvel Comics.

The Creation Engine was touted in reviews as the best in the

medium, giving users the ability to create costumes and powers for

their characters with more flexibility and particularity than any

other game.

Although the game had a “no infringement” policy,

gameplayers frequently encountered characters intended to

represent not the original creations touted by some of the game’s

literature, but replications of licensed characters, or even real

people.

City of Heroes User Agreement , supra note 93, at § 3. See also Ruling on Marvel’s

Motion to Dismiss Counterclaims, supra note 81, at 1.

Ruling on Marvel’s Motion to Dismiss Counterclaims, supra note 81, at 1.

See Marvel Second Amended Complaint, supra note 69, at 2. For a fuller discussion

of City of Heroes user-created infringing characters, including visual examples, visit this

Note’s companion website at http://brittonpayne.com/Marvel.html (last visited Apr. 11,

2006).

See, e.g., Michael Lafferty, Does Character Customization Get Any Better than City

of Heroes?, GAMEZONE.COM, http://pc.gamezone.com/news/06_10_04_03_28PM.htm

(last visited Dec. 1, 2005).

See Richard Duffek, City of Heroes Review, MMORPG.COM, Aug. 20, 2004,

http://www.mmorpg.com/gamelist.cfm/setview/reviews/gameID/3/loadReview/11/page/2

/from/%2Ffeatures%2Ecfm%2Fview%2Freviews. Although it is difficult to come by

thorough empirical data demonstrating this reality, players often take screenshots of their

gameplay and post them online. It is not difficult to find evidence of characters

infringing either the name or likeness, or both, of Marvel characters such as Hulk, Spider-

Man, Wolverine, Colossus, Tigra. Simulations of DC Comics characters Superman,

Batman, Wonder Woman, Shazam!, Green Lantern, and Flash abound, among many

others. There are infringements of property from other media, like Rayden from the

video game Mortal Kombat, movie characters from Kill Bill and Robocop, and television

characters like The Tick and Sydney Bristow from Alias. Recalling one of the most

famous cases in character copyright, a black and white character called Bogie was created

by a user of the game. Real people also have been created and used as characters in the

game, including NFL stars John Elway and Brett Favre, Maxim Magazine model Mandy

Amano, and the game-player themselves, although the right of publicity implicated is

beyond the scope of this Note. These examples are a testament not only to the vast

creative powers the game grants to users, but to the disinclination of many users to create

wholly original characters to play City of Heroes and the degree to which Cryptic allows

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In September of 2004, Marvel first contacted Cryptic and

NCsoft to complain that City of Heroes contained infringing

characters.

Marvel felt the game allowed and encouraged its

users to infringe character rights it held in characters like the

Incredible Hulk, Wolverine, and the Thing.

100

Apparently leading to an unsatisfactory result, the contact was

followed with a DMCA notification in October of 2004.

101

The

notification was rebuffed by NCsoft and Cryptic as lacking

“statements of accuracy or good faith belief.”

102

In addition,

NCsoft and Cryptic “objected that the names of [the] characters

specified in the letter had already been added to the software’s

Block List.”

103

Nevertheless, NCsoft and Cryptic agreed to

“review the characters and modify the Block List if needed.”

104

Still unsatisfied, on November 2, 2004, Marvel sent another

DMCA infringement notification to NCsoft, citing the characters

“Hulk10” and “Wolverine20” that were found in City of Heroes.

105

This time, NCsoft followed up by deleting many characters to

ensure the infringing characters were removed.

106

These efforts to

solve the problem without involving the courts were unsuccessful.

Judging from the mere eight days before Marvel’s next action, they

were perhaps unsuccessful by design.

infringement as a commonplace aspect of the game. For a collection of images culled

from City of Heroes fan websites posting these infringing images and more, visit this

Note’s companion website at http://brittonpayne.com/Marvel.html (last visited Apr. 11,

2006). For a sense of the long-term flow of the game, without actually having to play,

visit Christopher Sauisag’s illuminating 18 month screenshot diary of City of Heroes

gameplay, at City of Heroes, City of Heroes Fan Site, City of Hero Screenshots,

http://www.saguisag.com/column/cityofheroes/ (last visited Jan. 1, 2006) [hereinafter

Sauisag City of Heroes Diary].

Ruling on Marvel’s Motion to Dismiss Counterclaims, supra note 81, at 2.

100

Marvel Enters., Inc. v. NCsoft Corp., No. CV 04-9253, 2005 U.S. Dist. LEXIS 8448,

at *6 (C.D. Cal. Mar. 9, 2005) [hereinafter Ruling on NCsoft and Cryptic’s Motions to

Strike and Dismiss].

101

See Ruling on Marvel’s Motion to Dismiss Counterclaims, supra note 81, at 2.

102

Id.

103

Id.

104

Id.

105

See id.

106

Id.

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III. MARVEL SUES NCSOFT AND CRYPTIC ON INFRINGEMENT

THEORIES

On November 10, 2004, Marvel filed suit against NCsoft and

Cryptic Studios for infringement in the Central District of

California.

107

Marvel claimed that the game unlawfully permitted

and induced infringement of Marvel’s copyrights and

trademarks.

108

As it stood at the time of the December 14, 2005

settlement after more than a year of motion practice, Marvel had

five surviving complaints.

109

The first claim, direct copyright

infringement, was based on copyrighted Marvel characters.

110

Marvel not only claimed that the aspects of the game and its

marketing materials created by Cryptic such as Statesman directly

infringed,

111

but that NCsoft and Cryptic were guilty of aiding the

direct infringements of their users.

112

Marvel’s second claim, contributory copyright infringement,

was to be judged on the A&M Records v. Napster standard,

113

which would have required that NCsoft and Cryptic had

knowledge of the infringing conduct by their users, and that they

induced, caused, or contributed to the infringing conduct.

114

107

Marvel Complaint, supra note 6.

108

See id. at 2–3.

109

See Ruling on NCsoft and Cryptic’s Motions to Strike and Dismiss, supra note 100

at *20.

110

Id. at *6.

111

Marvel Second Amended Complaint, supra note 69, at 11.

112

Id. at 11–12. This claim of direct infringement is presumably based on the theory

that the user-generated characters are actually works jointly created by both NCsoft and

Cryptic and the user, and wholly-owned by NCsoft and Cryptic by the terms of the User

Agreement, see City of Heroes User Agreement, supra note 93, thus conferring direct

liability, although this is not articulated in the complaint.

113

239 F.3d 1004, 1020–22 (9th Cir. 2001) (stating that the test involves the company’s

“actual knowledge that specific infringing material is available using its system, that it

could block access to the system by suppliers of the infringing material, and that it failed

to remove the material”).

114

Ruling on NCsoft and Cryptic’s Motions to Strike and Dismiss, supra note 100, at *7

(citing Napster, 239 F.3d at 1019). This ruling was written a few months before Grokster

was handed down by the Supreme Court, so as of this writing, it is unclear if the Central

District will revise its standard to preclude the “caused, or contributed” clause based on

that opinion in a future case. It is clear that the Central District will follow Grokster’s

analysis of inducement, whether it is as a prong of the claim or its entirety. For further

discussion, see infra Part VII.A.

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Marvel’s third claim, vicarious copyright infringement, was

defined in the Napster decision as well, requiring direct

infringement by the user, direct financial benefit to NCsoft and

Cryptic, and their ability to supervise.

115

The fourth claim,

common-law trademark infringement, suggested that the image of

Statesman was a rip-off of Marvel’s Captain America.

116

Interpretations of these standards in an inevitable future case based

on the unresolved issues will provide the opportunity for the Court

to fully answer the question posed by Grokster and correct the

limitations of Sony inquiry.

IV. THE INFRINGEMENT-ENABLING PUZZLE

Examination of Marvel’s surviving claims of copyright and

trademark infringement address the larger debate about how and

when to protect copyright in the face of rapidly advancing digital

technology.

117

A company making millions of dollars

118

in a

billion-dollar industry

119

is enabling its users to infringe the

intellectual property of a company that has exploited those rights to

the tune of billions of dollars.

120

It is important that these issues

are resolved, as they affect all companies that commerce in

intellectual property.

115

Ruling on NCsoft and Cryptic’s Motions to Strike and Dismiss, supra note 100, at *9

(citing Napster, 239 F.3d at 1022).

116

Id. at *11–12.

117

Marvel’s claims of economic interference and the counterclaims of trademark

infringement and false notification will be mentioned, but are not the focus of this Note.

118

See supra note 3 and accompanying text.

119

“Video games are a $6.35 billion industry with online game revenue forecasted to

reach $9.8 billion in 2009.” Center for Strategic and International Studies, Massively

Multiplayer Online Games and the Video Game Revolution, Aug. 3, 2005,

http://www.globalization101.org/index.php?file=news1&id=10.

120

In 2004 alone, Marvel Enterprises reported $4 billion in worldwide retail sales. See

Dawn Wilensky, Are You on the List? Most Leading Licensors Remained Flat 2004

over 2003, L

ICENSE!, Apr. 2005, at 16, available at http://www.licensemag.com/

licensemag/article/articleDetail.jsp?id=154144.

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A. Operators of MMORPGs Appropriately Fall within the Scope

of the DMCA

The original inspirations for the safe harbor provision of the

DMCA were internet companies like America Online (AOL) and

Verizon.

121

These companies were basically paving the virtual

roads of the “information superhighway” that fueled imaginations

and the economy through the nineties, and were concerned that

they not become liable for the infringing uses of their millions of

users. Since they had little oversight of the content on web pages

they hosted, they were able to secure a safe harbor provision.

122

Further litigation fleshed out the scope of the definition of ISP, to

whom safe harbors are afforded—some cases limiting it to only

those companies that provide back-end support for transferring

information, some extending it to anyone with a web presence.

In the Marvel v. NCsoft litigation, the Central District of

California Western Division found that NCsoft and Cryptic qualify

as ISPs under the DMCA.

123

The court chose an inclusive reading

of the Section 512(c) safe harbor provision, which defines an ISP

as “a provider of online services or network access, or the operator

of facilities therefore . . . .”

124

Previous rulings from the court have

found internet vendors eBay and Amazon to be ISPs under the

DMCA.

125

Other courts have held similarly, including the Western

121

See In re Aimster Copyright Litig., 334 F.3d 643, 655 (7th Cir. 2003).

122

17 U.S.C. § 512 (2000); see, e.g., TECH LAW JOURNAL, BLUMENTHAL V. DRUDGE AND

AOL, Dec. 18, 1999, http://www.techlawjournal.com/courts/drudge/Default.htm (AOL

dismissed from a slander case against The Drudge Report). But see Sarah Deveaux,

Yahoo Wins Court Reprieve in Nazi Sales Case, CNN.

COM, July 26, 2000,

http://archives.cnn.com/2000/TECH/computing/07/26/yahoo.nazi.idg (Yahoo subject to

prosecution in France for allowing its users to offer Nazi memorabilia, which is illegal in

France).

123

Ruling on Marvel’s Motion to Dismiss Counterclaims, supra note 81, at 5.

124

17 U.S.C. § 512(k)(1)(B) (2000).

125

See Hendrickson v. Amazon.com, Inc., 298 F. Supp. 2d 914, 915 (C.D. Cal. 2003)

(finding that Amazon meets the DMCA’s definition of a service provider); Hendrickson

v. eBay, Inc., 165 F. Supp. 2d 1082, 1088 (C.D. Cal. 2001) (finding that eBay qualifies as

a service provider). “The DMCA also provides a different, more restrictive, definition of

‘service provider.’ See 17 U.S.C. § 512(k)(1)(A). This definition only applies to entities

seeking protection from liability under the ‘transitory digital network communications’

safe harbor. See 17 U.S.C. § 512(a). The more restrictive definition does not apply to an

entity, such as Amazon, that seeks protection under the ‘information residing on systems

or networks at the direction of users’ safe harbor. See 17 U.S.C. § 512(k)(1)(B).” Corbis

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District of Washington,

126

the Seventh Circuit,

127

the D.C.

District,

128

and the Fourth Circuit.

129

They have found that the

definition of an ISP should be read inclusively in order to grant

safe harbor for cooperating internet entities. There are other courts

and scholars that have suggested the safe harbor provision should

be read more narrowly. The Eighth Circuit has noted that if

Congress wants a more inclusive law, they should pass new

legislation.

130

Similarly less inclusive readings of the definition of

an ISP have appeared in the D.C. Circuit

131

and in North

Carolina.

132

Because the DCMA provides sufficient tools for courts to use

in fashioning responsible solutions for questions of digital

infringement, it should be read to include game operators like

Corp. v. Amazon.com, Inc., 351 F. Supp. 2d 1090, 1100 n. 5 (W.D. Wa. 2004). “Corbis

argues that Amazon is not a service provider because Amazon does not ‘serve to route or

connect online digital communications.’ This argument is unavailing—the relevant

definition of service provider does not require Amazon to engage in such activity. See 17

U.S.C. § 512(k)(1)(B).” Corbis, 351 F. Supp. 2d at 1100 n. 6 (internal citations omitted).

126

Corbis, 351 F. Supp. 2d at 1100 (noting that the definition of an ISP under 17 U.S.C.

§ 512(k)(1)(B) (2000) “encompasses a broad variety of Internet activities” and that “there

is no doubt that Amazon fits within the definition”).

127

In re Aimster Copyright Litig., 252 F. Supp. 2d 634, 657–58 (N.D. Ill. 2003) (noting

that “‘service provider’ is defined so broadly that we have trouble imagining the

existence of an online service that would not fall under the definitions” in a case about a

file-sharing/music downloading service). This decision was affirmed in the Seventh

Circuit. In re Aimster Copyright Litig., 334 F.3d 643, 655 (7th Cir. 2003) (noting that

“the definition of Internet service provider is broad (‘a provider of online services or

network access, or the operator of facilities therefor,’ 17 U.S.C. § 512(k)(1)(B) (2000))

and, as the district judge ruled, Aimster fits it”).

128

In re Verizon Internet Servs., Inc., 240 F. Supp. 2d 24, 30 (D.D.C. 2003) (noting the

narrow definition of “service provider” in 17 U.S.C. § 512(a) (2000) and the inclusive

broader definition of “service provider” in 17 U.S.C. § 512(b)–(d) (2000)).

129

ALS Scan, Inc. v. RemarQ Cmtys., Inc., 239 F.3d 619, 623 (4th Cir. 2001) (noting

that the Act defines a service provider broadly).

130

In re Charter Communs., Inc., 393 F.3d 771, 777 (8th Cir. 2005) (“[I]t is the

province of Congress, not the courts, to decide whether to rewrite the DMCA in order to

make it fit a new and unforeseen [I]nternet architecture and accommodate fully the varied

permutations of competing interests that are inevitably implicated by new technology.”

(internal quotations and citation omitted)). It appears that the Eighth Circuit’s desire to

get at infringers contributed materially to this finding. See id.

131

See Recording Industry Ass’n of Am., Inc. v. Verizon Internet Servs., Inc., 351 F.3d

1229, 1237–38 (D.C. Cir. 2003).

132

See In re Subpoena To University of North Carolina at Chapel Hill, 367 F. Supp. 2d

945, 953 (M.D.N.C 2005).

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NCsoft.

133

The letter of the law makes it fairly clear that they

should fall under the safe harbor provisions of Sections 512 (b)

and (c).

134

Moreover, there are more important reasons for having

an expansive view of the scope of the DMCA. Ease of publication

in a digital environment ensures that copyright infringement

situations will continue to arise. If the DMCA is not read liberally,

the only recourse intellectual property companies will have is to

bring an action in court. The DMCA provides a way to lessen that

burden. Given the complexity of the DMCA and the acceptance

among circuits of an inclusive definition of an ISP, it seems

inefficient to require Congress to revisit the issue when the result

would likely be similar. It is more sensible to accept the

interpretation that would allow courts to solve the problem.

Congress should only be expected to step in where the courts have

clearly acted outside of the purpose of the legislation.

However, concurrent with an inclusive reading, there should be

a fact-intensive inquiry leading to an active use of injunctive relief

available under Section 512(j)(1)(A)(iii). Filtering technology is

already considered in the DMCA,

135

but courts should use the

injunctive authority to craft the scope of the filtering necessary.

Each new use of the technology threatens an imbalance. Where

traditional market forces and economic incentives fail to solve

problems, courts must have a free hand in crafting solutions within

the power granted by Congress in the DMCA. Where a court has

been drawn into a dispute, that court is in the best position to

dictate the appropriate future filtering behavior required to grant a

safe harbor. Further discussion in this Note will consider exactly

what that scope of injunctive relief available under the DMCA

should be.

136

133

See Charter Communs., 393 F.3d at 778 (Murphy, J. dissenting) (“The legislative

solution in response to these concerns significantly limited the liability of ISPs for

infringement by their customers and provided copyright holders more direct means to

attack digital piracy.”).

134

17 U.S.C. § 512(k)(1)(B) (2000) (defining an ISP under §§ 512 (b) and (c) as “a

provider of online services”).

135

Id. at § 512(j)(2)(D) (stating that, in granting an injunction, courts should consider

“whether other less burdensome and comparably effective means of preventing or

restraining access to the infringing material are available”).

136

See infra Part VI.

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B. The Inducement to Infringe in City of Heroes Does Not Rise to

the Level of a Violation under Grokster

The Grokster case was lined up to answer the question of

whether the Sony standard of “capable of substantial noninfringing

use” still existed and how it applied to online infringement.

However, the decision instead added a new layer of inquiry before

the Sony standard needed to be addressed.

137

The Court decided

unanimously that both Grokster’s and StreamCast’s behavior

constituted inducing infringement and that each was thus liable for

the copyright infringements of its users.

138

In order to determine if

any acts by NCsoft or Cryptic would have triggered a Grokster

violation, a look into the Grokster and StreamCast inducing

behavior is appropriate.

Grokster predicated its business model on attracting the

infringing users abandoned by Napster after its services were

found to confer copyright liability.

139

They hoped to attract

advertising linked to their interface by distributing their software

freely and making it clear to its potential users that the software

could aid them in illegally sharing copyrighted materials.

140

The

vast majority of the materials transferred using the software was

copyrighted material and the owners of those copyrights banded

together in the Grokster suit.

141

The Court unanimously found

liability on an inducement theory, based on many actions taken by

Grokster and StreamCast in distributing their product.

142

StreamCast averred that their “goal [was] to get in trouble with the

law and get sued.”

143

They prepared promotional materials that

flaunted the illegal uses of their software.

144

StreamCast rebuffed

other companies’ offers to help them monitor infringement, and

137

See Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 125 S. Ct. 2764, 2770

(2005).

138

See id.

139

Id. at 2772–73.

140

Id. at 2773.

141

Id. at 2771–72; see id. at 2786 n.3 (Ginsburg, J., concurring) (recounting specific

figures which indicate that the vast majority of the materials shared were copyrighted).

142

See id. at 2770.

143

Id. at 2773.

144

See id.

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blocked them from doing so independently.

145

The Court also

looked disfavorably on attempts to attract the user base of the

“notorious” Napster service,

146

who are established as “of a mind

to infringe.”

147

Grokster developed a program that would direct

computer users searching for “Napster” on a search engine to the

Grokster web site.

148

StreamCast presented itself as “similar to

what Napster was.”

149

NCsoft and Cryptic took several actions that Marvel

complained are sufficiently inducing to trigger liability under the

Grokster standard.

150

The City of Heroes marketing exhorted

potential customers to “bring[] the world of comic books alive,”

although at the time it owned no comic book characters of its

own.

151

Marvel claimed that the Creation Engine “encourages

players to create and utilize Heroes that are nearly identical in

name, appearance and characteristics to characters belonging to

Marvel” by including choices that allow power combinations

similar to Marvel characters.

152

Through its lax enforcement of the

non-infringement clause in NCsoft and Cryptic’s user agreement,

Marvel alleged that City of Heroes effectively creates a space

where it is known that there will be no consequence for the

infringement of character rights.

153

Comparisons can be made between NCsoft’s actions and the

inducing behavior in Grokster. The companies in each case were

aware that their users employed their software to engage in acts of

154

Each encouraged that infringement

145

Id. at 2774.

146

See id. at 2772.

147

Id. at 2774.

148

Id. at 2773.

149

Id.

150

See Marvel Second Amended Complaint, supra note 69, at 2.

151

See id.

152

See id. (noting that City of Heroes allows a player to create a character “nearly

identical in appearance and attributes as” Marvel’s characters).

153

See, e.g., id. at 7.

154

Grokster, 125 S. Ct. at 2772 (noting that “Grokster and StreamCast concede the

infringement in most downloads and it is uncontested that they are aware that users

employ their software primarily to download copyrighted files”); see Ruling on Marvel’s

Motion to Dismiss Counterclaims, supra note 81, at 1–2 (noting that NCsoft and Cryptic

added names to its block list and removed characters from its system that allegedly

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through their advertising and public statements and sought out

customers who were drawn to the protected works.

155

Neither

company made effective efforts to impede their users’ infringing

behavior.

156

Both companies’ opportunities grew as their user base

did, which they knew depended in significant part on users who

intended to infringe.

157

And in both cases, the pursuit of direct

infringers was prohibitively expensive for copyright holders, which

led to underenforcement.

158

Where no action is taken to encourage infringement through

means such as advertising, the distributor will not be subject to

liability for contributory infringement under Grokster,

159

a kind of

“don’t ask, don’t sell” standard.

160

However, Grokster and

StreamCast had clearly induced, and could be found liable for the

infringement of their users.

161

Once Grokster-level inducement

has been found, there is liability for user infringement.

162

However, NCsoft and Cryptic did not induce users to infringe to

the same degree as either Grokster or StreamCast. The main

infringed Marvel’s rights) in conjunction with City of Heroes User Agreement, supra

note 93.

155

Grokster, 125 S. Ct. at 2774; see Hardy, supra note 2 (noting that game co-creator

Richard Dakan brought in Jack Emmert “to build a game featuring the science fiction of

comic-book superheroes—without paying license fees for established characters like

Batman or Spider-Man”); City of Heroes Advertisement, supra note 89 (NCsoft and

Cryptic advertisement in a superhero comic book); Press Release: City of Heroes Launch,

supra note 90 and accompanying text (“everyone can be the hero they’ve always

dreamed of”) (together indicating that NCsoft and Cryptic wanted to create a game for

fans of superhero comics and advertised as such).

156

Grokster, 125 S. Ct. at 2774; see Duffek, supra note 98 (noting that City of Heroes

was riddled with infringing superheroes from launch through the filing of the suit).

157

Grokster, 125 S. Ct. at 2774; see Bub, supra note 91 and accompanying text (noting

how NCsoft calculated its breakeven costs based on the number of subscribers it was able

to enlist to City of Heroes).

158

See Grokster, 125 S. Ct. at 2776; In re Aimster Copyright Litig., 334 F. 3d 643, 645

(7th Cir. 2003) (noting that “chasing individual consumers is time consuming and is a

teaspoon solution to an ocean problem” (citing Randal C. Picker, Copyright as Entry

Policy: The Case of Digital Distribution, 47

ANTITRUST BULL. 423, 442 (2002))); Marvel

Complaint, supra note 6, at 11–13 (alleging “literally thousands of infringing Heroes

roaming the streets of [City of Heroes]”).

159

See Grokster, 125 S. Ct. at 2776 (citing Gershwin Publ’g Corp. v. Columbia Artists

Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971)).

160

Jon Pareles, The Court Ruled, So Enter the Geeks, N.Y. TIMES, June 29, 2005 at E1.

161

Grokster, 125 S. Ct. at 2782.

162

Id. at 2770.

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distinction is that in Grokster, the vast majority of uses of the

software were infringing—practically the sole purpose was to

illegally download copyrighted songs.

163

In Marvel v. NCsoft,

there is no accurate measure of the percentage of users that

infringe and there is certainly evidence of a great deal of non-

infringing use.

164

In Grokster, the non-infringing use was

practically theoretical,

165

as was an effective filtering remedy, due

to the construction of the software.

166

Where software has been

constructed without consideration of reasonably foreseeable

secondary infringement, it seems fair that the burden of correcting

the problem should lie with the enabling software company. The

potentially inducing advertising claim that the game “brings the

world of comic books alive”

167

was an important, but ultimately

small, portion of NCSoft’s promotional text. Although NCsoft

was not completely ignorant as to infringing uses of its service, the

evidence of inducement is not as substantial as it was in Grokster,

and is not even sufficient to trigger liability under the articulated

Grokster standard. Grokster was held liable by the Supreme Court

under its articulated standard that “one who distributes a device

with the object of promoting its use to infringe copyright, as shown

by clear expression or other affirmative steps taken to foster

infringement, is liable for the resulting acts of infringements by

third parties.”

168

Although it appears to have been an object of

NCsoft to promote the fact that users could infringe, it was not the

object that they would, as it was in Grokster.

C. The Intersection of Sony and Notice and Knockdown

The question of the amount of infringement necessary to

trigger liability for third-party infringements absent inducement

that Grokster failed to answer

169

was originally posed in the Sony

163

Id. at 2771.

164

See, e.g., Sauisag, City of Heroes Diary, supra note 98.

165

Grokster, 125 S. Ct. at 2785 (Ginsburg, J., concurring).

166

See id. at 2781 (noting that “neither company attempted to develop filtering tools or

other mechanisms to diminish the infringing activity using their software”).

167

See City of Heroes Advertisement, supra note 89 and accompanying text.

168

Grokster, 125 S. Ct. at 2770 (emphasis added).

169

See id. at 2786 (Ginsburg, J., concurring), 2787 (Breyer, J., concurring).

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decision.

170

There, television program copyright holders pursued

their rights against VCR manufacturers who were enabling their

users to create unauthorized copies of the copyrighted

programming.

171

The Sony Court held that the sale to the general

public of equipment capable of substantial noninfringing uses does

not constitute contributory infringement for users’ infringement of

172

At the time of Sony, some sports, religious and

educational broadcasters allowed VCR owners to tape their

broadcasts.

173

The Court found that this was enough noninfringing

use to provide safe harbor for VCR manufacturers, and found

separately that even if it was not, the “timeshifting” function of the

VCR, the ordinary consumer use to tape a show and watch it later,

constituted “fair use” and was not infringing.

174

Grokster

presented an opportunity for the Court to provide more guidance

for determining what exactly does constitute “substantial

noninfringing uses.”

By basing its unanimous decision on an inducement theory, the

Grokster Court avoided the question of whether the file-sharing

product was sufficiently “capable of substantial noninfringing

uses,” as the Court found a VCR to be in Sony. Two concurring

opinions held opposite positions on the issue. Justice Ginsburg

wrote that the Grokster and StreamCast products are used

overwhelmingly to illegally copy protected works and failed the

Sony standard.

175

Justice Ginsburg also commented that their

supposedly substantial noninfringing use was either speculative or

“little beyond anecdotal.”

176

Justice Breyer disagreed and wrote

that the product clearly satisfied the Sony standard of nine percent

noninfringing use, which included the sharing of authorized copies

of music, free electronic books, public domain and authorized

software, and authorized music videos, as well as possible future

non-infringing uses.

177

Justice Breyer also pointed out other tools

170

Sony Corp. of Am. v. Universal City Studios, Inc., 104 S. Ct. 774, 789 (1984).

171

Id. at 777.

172

Id. at 795–96.

173

Grokster, 125 S. Ct. at 2788 (Breyer, J. concurring) (discussing the facts of Sony).

174

Id.

175

Grokster, 125 S. Ct. at 2785 (Ginsburg, J., concurring).

176

Id.

177

Id. at 2788–89 (Breyer, J. concurring).

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for reducing piracy, like Grokster-style inducement theory suits,

traditional direct infringement suits, new technology, and making

lawful copying cheaper and easier.

178

Each concurring opinion had

the support of three Justices,

179

with the remaining three Justices

seeing no present need to address the issue that will likely define

future file-sharing cases.

180

In its 1996 Fonovisa v. Cherry Auction decision, the Ninth

Circuit ruled that the operators of a swap meet could be held liable

for vicarious and contributory infringement of copyright and

contributory trademark infringement.

181

Although not a

technology decision, it offers a good analogy to Marvel v. NCsoft.

In each case, a company was aware that its service was being used

to infringe and did not fully pursue avenues available to it to

prevent that infringement. In neither case was the infringing

behavior the “overwhelming” use of the service. A finding of

liability absent inducement in Fonovisa opens the door for a

finding of liability in Marvel v. NCsoft. Fonovisa is a post-Sony

finding of vicarious and contributory liability for an enabler.

Although it is pre-DMCA, its analysis of the claims is not

outmoded. The Grokster holding may have foreclosed a Fonovisa

finding of contributory liability absent inducement, but the opinion

specifically reserved the possibility for a finding of vicarious

liability.

182

The Grokster Court held that “[o]ne infringes vicariously by

profiting from direct infringement while declining to exercise a

right to stop or limit it.”

183

NCsoft has the right to stop or limit the

infringement of its users by the terms of its End User License

Agreement (“EULA”).

184

Sony seems to indicate that “profiting

from direct infringement” would be determined in the context of an

enabling technology under its “capable of substantial noninfringing

uses” standard. Unfortunately, its definition is at best unclear, and

178

Id. at 2794–95 (Breyer, J. concurring).

179

See id. at 2783 (Ginsburg, J. concurring), 2787 (Breyer, J. concurring).

180

See id. at 2776 n.9.

181

76 F.3d 259, 264–65 (9th Cir. 1996).

182

Grokster, 125 S. Ct at 2776 n.9.

183

Id. at 2776 (citing Shapiro, Bernstein & Co. v. H. L. Green Co., 316 F.2d 304, 307

(2d Cir. 1963)).

184

See City of Heroes User Agreement, supra note 94 and accompanying text.

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at worst inadequate. The DMCA offers a safe harbor by more

fully defining the phrase “exercise a right” for an ISP.

185

Therefore, under the Sony standard, absent inducement, an enabler

can avoid liability for vicarious infringement by following the

DMCA Notice and Knockdown procedures. A fact-based analysis

will be required to determine what the filtering procedures should

be with regards to new applications of emerging technologies.

This Note offers a solution in the context of character generation in

video games below,

186

and finds that NCsoft and Cryptic would be

secondarily liable, suggesting specific injunctive relief available

for Marvel under the terms of the DMCA.

187

D. Strictly Interpreted Notice and Knockdown Does Not Provide

Adequately Protect Copyright Holders

The biggest problem with Notice and Knockdown is its strict

interpretation of notice. As originally conceived, it works well for

a website that posts the full text of a copyrighted novel. An

infringer would have to create a page in a program, such as

Dreamweaver,

188

upload the page to a website, and lure other

people to the website. The benefit to the infringer comes from

drawing attention to itself, whether it results in selling the

infringing material, or advertising to the people who come to see

the infringing material. The infringing website would thus come to

the attention of the rights-holder, or through a simple web search

of a passage from the copyrighted work, a process that can be

programmed to run automatically. Once the ISP received

notification of the infringing material, the offending work would

185

See Grokster, 125 S.Ct at 2776.

186

See infra Part VI.

187

If the court did not want to find NCsoft and Cryptic liable, it could have found that

the Sony safe harbor survives Grokster one way or another, and confer protection for City

of Heroes as an emerging technology “capable of substantial noninfringing use.” This

approach is unusual and unlikely, but worthy of at least a mention. This Note finds a far

better solution in replacing the Sony standard with the BIFF Factors, discussed infra

Part VI.

188

SiteBuilder.ws, Dreamweaver Video Tutorials, http://www.sitebuilder.ws/

dreamweaver/tutorials/ (last visited Jan. 19, 2006). Dreamweaver is an “industry-leading

development tool enabling users to efficiently design, develop and maintain standards-

based websites and applications.” Macromedia.com, Dreamweaver 8,

http://www.macromedia.com/software/Dreamweaver (last visited Mar. 29, 2006).

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be removed, the infringer would be on notice, and the ISP would

not be burdened with policing its sites. Repeat offenders would be

discouraged because each knockdown would require the offender

to repeatedly invest start-up costs to attract users and would require

a cumbersome turnaround time for reposting.

However, in the context of a game like this, the “posting” of

infringing material is much more fluid. The ISP itself enables the

creation of the material and its posting through the Creation Engine

and the maintenance of the game. When Cryptic is notified of an

infringing character, the character is knocked down, but the

infringing user can simply try again with the same tools provided

by the game.

In addition, a copyright holder cannot generally discover a

player who has infringed its rights without playing the game. Once

the game has been joined, it runs on several different servers

(named Justice, Liberty, etc.), similar to NFL games between

different teams played simultaneously in different stadiums in

different cities.

189

For a company like Marvel to police the game,

they would need a presence in all of the servers at all times, which

is just the kind of monitoring the DMCA discourages in enforcing

its provisions.

190

V. INFRINGEMENT IN THE MILIEU OF SUPERHEROES

For a finding of copyright infringement, whether direct,

contributory or vicarious, there must be an instance of the copying

of protected materials. All of Marvel’s characters at issue are

protected by copyright. Since these characters are all superheroes,

certain discrete issues are raised that have been explored in prior

cases. The scope of copyright protection for superheroes will

inform the scope of the solution necessary in a character

infringement case like Marvel v. NCsoft.

189

See NFL.com, NFL Schedules, http://www.nfl.com/schedules (last visited

Dec. 3, 2005).

190

See 17 U.S.C. § 512(m) (2000) (“Nothing in this section shall be construed to

[require] a service provider monitoring its service . . .”). A more helpful interpretation of

the notice aspect of Notice and Knockdown is discussed below. See infra Part VI.A and

accompanying notes.

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A. Superhero Infringement Cases

1. 1941: Wonderman: Closely Imitating the Costume

There have been several cases involving the infringement of

superheroes since Superman hit the scene in 1938.

191

The first was

inspired by Superman himself.

192

Superman debuted in an

anthology magazine called Action Comics, published by Detective

Comics, Inc., the precursor to DC Comics.

193

It sold surprisingly

well from the beginning, but the publisher was not sure which

feature was driving the sales. However, Detective Comics’

accountant Victor Fox had figured out that it was the popularity of

the colorfully unique Superman, and left the publishing company

to start his own Bruns Publications.

194

He hired his own artists and

writers, and put out the first issue of Wonder Comics in May of

1939, featuring Wonderman.

195

Detective Comics sued him for

infringing Superman.

196

The court found that Bruns Publications

had infringed, citing the copying of panels from the original, and

the copying of story elements.

197

Traditional copyright law covers

the copying of story elements, and was applied here.

198

The

question of additional protection for the character apart from the

story was specifically acknowledged as prohibited by Nichols v.

191

See DANIELS: GOLDEN AGE, supra note 57, at 4 (noting that Superman debuted in

Action Comics in 1938).

192

See Detective Comics, Inc. v. Bruns Publ’ns, Inc., 111 F.2d 432, 433 (2d Cir.1940).

193

See Jerome Siegel & Joe Shuster, Superman, ACTION COMICS 1, at inside cover, 1

(Detective Comics, Inc. June 1938) (first appearance of Superman), reprinted in

UPERMAN IN ACTION COMICS ARCHIVES, VOLUME ONE 9 (Bob Kahan ed., DC Comics

1997), available at http://superman.ws/tales2/action1/?page=0 (last visited Dec. 3, 2005)

(providing image of inside cover); see also Siegel v. Nat’l Periodical Publ’ns, Inc., 508

F.2d 909, 911 (2d Cir. 1974). For the full story of Superman’s journey from creation to

publication, see

DANIELS: SUPERMAN, supra note 56, at 15–35.

194

See Schienke, supra note 29, at 69.

195

See id.; Will Eisner, The Origin of Wonder Man, WONDER COMICS 1, at 1 (Fox

Publ’ns May 1939). Fox hired comics legend Will Eisner to create the first issue, under

orders to create “another Superman.” Eisner subsequently testified against Fox in the

trial. Mikel Midnight, Wonder Man, W

ILDWOOD CEMETERY: THE SPIRIT DATABASE,

http://www.wildwoodcemetery.com/wonderman.shtml (last visited Dec. 3, 2005).

196

See Bruns, 111 F.2d at 433.

197

See id. For a side-by-side comparison of the offending panels, visit this Note’s

companion website at http://brittonpayne.com/Marvel.html (last visited Apr. 11, 2006).

198

See Bruns, 111 F.2d at 433.

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Universal Pictures,

199

but was effectively addressed in the

injunctive relief.

200

Where an infringer is not copying any story

elements, specific feats or particular images, the relevant standard

articulated in Bruns is an injunction prohibiting “closely imitating

[a superhero’s] costume or appearance in any feat whatever.”

201

Since the milieu of superheroes—whether in a comic book or in a

video game—will inherently involve “feats,” infringement can be

established through the similarity of costume or appearance.

202

2. 1942: The Lynx with Blackie the Mystery Boy:

A Comparison of the Cartoons

Unbowed by his loss in the Wonderman case,

203

Fox tried

again in August of 1940 with a feature in his Mystery Man Comics

featuring The Lynx, an athletic crime-fighter with a boy sidekick

called Blackie the Mystery Boy.

204

The judge came to the same

conclusion as in the Wonderman case, finding “deliberate copying

by the defendant of drawings and cartoons of the Batman and his

companion Robin.”

205

The costumes of the Lynx and Blackie do

not look anything like Batman and Robin at first glance, but

considering that the work was copied panel by panel in some

instances, the resemblance of linework that led to the finding of

199

Id. at 434 (citing Nichols v. Universal Pictures Corp., 45 F.2d 119 (2d Cir. 1930)).

200

See id.

201

Id.

202

See, e.g., THE AMERICAN HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE 1802

(3d ed., Houghton Mifflin Co. 1996) (“Superhero: A figure, especially in a comic strip or

cartoon, endowed with superhuman powers and usually portrayed as fighting evil or

crime.”).

203

See supra Part V.A.1.

204

See Detective Comics, Inc. v. Fox Publ’ns, Inc., 46 F. Supp. 872, 873

(S.D.N.Y. 1942); Norton Kingsley, The Coming of the Lynx, M

YSTERY MEN COMICS 13

at 54 (Fox Publ’ns Aug. 1940). This issue has not been reprinted, and an original print is

not readily available, selling for thousands of dollars. See, e.g., William Hughes

Vintage Collectibles.net, http://www.vintagecollectables.net/detail.php?issue_id=889&

PHPSESSID=4a38428f03690da4565a198e7f09bb31 (last visited Dec. 3, 2005). To see

an adventure of The Lynx from a subsequent issue, see Norton Kingsley, The Rook

Strikes, M

YSTERY MEN COMICS 21, at 37 (Fox Publ’ns Apr. 1941), reprinted in Pure

Excitement Comics (Vol. 1) 42, (Bill Nolan ed., Feb. 2002), available at

http://pecomics.tripod.com/42contents.html.

205

Fox, 46 F. Supp. at 873.

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infringement is more apparent.

206

In a case like this, the evidence

of intent seemed to allow a finding of infringement despite a lower

level of similarity among the character images.

3. 1951: Shazam!: It Takes Scarcely More than a Glance

Another Superman infringement case involved Fawcett

Publishing’s Captain Marvel, a boy who could turn into a

costumed, super-powered man by uttering the magic word

“Shazam!”

207

The case dragged on through the 1940s, finally

resolving in the Second Circuit in 1952.

208

Experts on both sides

analyzed the various comic books.

209

The district court compared

206

Compare Kingsley: The Rook Strikes, supra note 204 with, e.g., Bill Finger & Bob

Kane, The Case of the Chemical Syndicate, D

ETECTIVE COMICS 27, at 2 (DC Comics May

1939) (first appearance of Batman), reprinted in BATMAN ARCHIVES, VOLUME ONE 7

(Dale Crain ed., DC Comics 1990). A side-by-side comparison is available at this Note’s

companion website, at http://brittonpayne.com/Marvel.html (last visited Apr. 11, 2006).

207

See Detective Comics, Inc. v. Fawcett Publ’ns, Inc., 4 F.R.D. 237 (S.D.N.Y. 1944);

Bill Parker, C. C. Beck & Pete Costanza, Introducing Captain Marvel, WHIZ COMICS 2,

at 1 (Fawcett Publ’ns Feb. 1940) (first appearance of Captain Marvel), reprinted in T

SHAZAM! ARCHIVES, VOLUME ONE 19 (Bob Kahan ed., DC Comics 1992). In subsequent

years, the character would be entirely abandoned, see Brian Cronin, Comic Book Urban

Legends Revealed #6!, C

OMICS SHOULD BE GOOD, July 7, 2005, http://goodcomics.

blogspot.com/2005/07/comic-book-urban-legends-revealed-6.html, and “Marvel” was

adopted by Timely Comics as its new name. See Markstein, supra, note 67 and

accompanying text. When DC Comics leased the rights to publish Fawcett’s Captain

Marvel character from then-owner Charlton, Marvel Comics immediately produced its

own Captain Marvel comic book starring a new space-based superhero of the same name,

see Stan Lee, Roy Thomas & Gene Colan, Out of the Holocaust . . . A Hero!, C

APTAIN

MARVEL 1, at 1 (Marvel Comics Group, May 1968), reprinted in Stan Lee, et al.,

ARVEL MASTERWORKS: CAPTAIN MARVEL (VOL. 1) (Marvel Comics 2005), to protect its

trademark. By subsequent agreement with Marvel, DC Comics can publish the

adventures of Captain Marvel, but cannot use the term “Captain Marvel” on its covers or

promotional materials. Thus, the DC Comics version is typically identified as “Shazam!”

See Brian Cronin, Comic Book Urban Legends Revealed #12!, C

OMICS SHOULD BE GOOD,

Aug. 18, 2005, http://goodcomics.blogspot.com/2005/08/comic-book-urban-legends-

revealed-12.html.

208

See Nat’l Comics Publ’ns, Inc. v. Fawcett Publ’ns, Inc. 198 F.2d 927 (2d Cir. 1952)

(memorandum to original opinion Nat’l Comics Publ’ns, Inc. v. Fawcett Publ’ns, Inc.,

191 F.2d 594 (2d Cir. 1951).

209

See Nat’l Comics Publ’ns, Inc. v. Fawcett Publ’ns, Inc. 93 F. Supp. 349, 355–56

(S.D.N.Y. 1950), aff’d Fawcett, 198 F.2d 927. Compare, e.g., Siegel, supra note 193,

at 1 (first appearance of Superman), with, e.g., Parker, supra note 207, at 1 (first

appearance of Captain Marvel). For a comparison of similar covers featuring the two

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“facial appearances, costumes, etc., and the superhuman feats

performed,” although notably, the duplication of powers in the

abstract was not considered.

210

Comparison of the characters

included analysis of physical attributes, costumes, recounted feats,

setting, dialogue, and story elements.

211

There was also discussion

of the intent of the creators to infringe, citing interviews with

artists instructed to “imitate the ‘Superman’ strips and the dialogue

and script as closely as possible.”

212

In Judge Learned Hand’s appellate opinion, he accepted the

findings of infringement of the district court and primarily detailed

the arcane copyright notifications required under the now-defunct

1909 Copyright Act.

213

On the issue of the standard of

infringement for “these silly pictures,”

214

Judge Hand stated that “a

plagiarist can never excuse his wrong by showing how much he

did not plagiarize.”

215

He concluded that as to the infringement of

Superman, final judgment required “scarcely more than a glance at

characters, visit this Note’s accompanying website at http://brittonpayne.com/

Marvel.html (last visited Apr. 11, 2006).

210

See Fawcett, 93 F. Supp. at 355–56.

211

See id. On appeal, the Second Circuit found that “changes of a few lines or colors in

a pictorial [work] may be too trivial to be noticeable by an ordinarily attentive reader or

observer; and we will assume arguendo that in such cases the variant cannot be

copyrighted.” Nat’l Comics Publ’ns, Inc. v. Fawcett Publ’ns, Inc., 191 F.2d 594, 600

(2d Cir. 1951).

212

Id.

In the beginning everyone was jumping onto the comic book bandwagon.

There was no question that Captain Marvel derived from Superman . . . We had

our Superman-type character just like everyone else had theirs. So why did

Superman’s publisher pick on us? Simply because we were beating them in

sales! The lawsuits dragged on for years; there were three of them: We won

the first, lost the second, won the third . . . but then there was a problem. One

artist, I don’t know who, took either a page or a panel from Superman comics

and traced it exactly . . . and simply inserted Marvel where Superman was.

That killed us. We settled out of court. We paid them $400,000. The

settlement said that we do not admit to copying Superman but promised never

to publish Captain Marvel ever again.

P.C.

HAMERLINCK, FAWCETT COMPANION: THE BEST OF FCA 12–13 (Paul Hamerlinck ed.,

TwoMorrows Publishing 2001) (quoting Fawcett circulation director Roscoe Kent

Fawcett in “The Fawcetts Could Do It As Well, Or Better, Than Anybody:” The Roscoe

K. Fawcett Interview).

213

See Fawcett, 191 F.2d 594.

214

Id. at 603.

215

Id.

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corresponding ‘strips’ of ‘Superman’ and ‘Captain Marvel’ to

assure the observer that the plagiarism was deliberate and

unabashed.”

216

In all three of these early superhero cases, infringement was

found with considerably less similarity in appearance than in the

City of Heroes case. However, a great deal more emphasis was put

on similarity of the story elements. The decisions both clearly

articulated that similarity in appearance would constitute

infringement and that further examination into intent was

appropriate.

4. 1980: Manta and Superstretch: Trademark Protection for

Superhero Ingredients

Trademark law was implicated in the superhero infringement

case of DC Comics, Inc. v. Filmation Associates.

217

Filmation

produced an animated series for DC Comics featuring its character

Aquaman and had an option to produce a series for Plastic Man.

218

When the deal fell through, Filmation created adventures featuring

Manta and Superstretch, characters similar to DC Comics’

properties, but entirely different in costume.

219

DC Comics sued

for trademark infringement, as well as other theories of liability.

220

The jury found that there was infringement, and the Southern

District of New York declined to vacate their judgment.

221

In its

analysis, it noted:

Protectable “ingredients” recognized in this circuit

include the names and nicknames of entertainment

characters, as well as their physical appearances and

costumes, but not their physical abilities or personality

traits. The failure of any court so far to grant Lanham Act

216

Id. at 597.

217

486 F. Supp. 1273 (S.D.N.Y. 1980).

218

Id. at 1276.

219

Id. In addition to having very different costumes, Plastic Man is Caucasian and

Superstretch is African-American. See Blacksuperhero.com, The Museum of Black

Superheroes—Superstretch, http://www.blacksuperhero.com/exhibithtml/detail.cfm?id

=286 (last visited Dec. 5, 2005).

220

Filmation, 486 F. Supp. at 1276.

221

See id. at 1276, 1285.

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protection for character traits or abilities makes sense since

it is difficult to see how such intangible qualities, having an

infinite number of possible visible and audible

manifestations, can achieve that fixture or consistency of

representation that would seem necessary to constitute a

symbol in the public mind.

222

The court noted that although DC Comics’ “remedy more

properly lies under the Copyright Act[,] . . . an ingredient of the

product itself can amount to a trademark protectable under § 43(a)

because the ingredient can come to symbolize the plaintiff or its

product in the public mind.”

223

Little of the remainder of the

decision focused on elements of superhero infringement, but

accepted the jury’s conclusion that Manta infringed Aquaman and

Superstretch infringed Plastic Man.

224

These cases explore elements that can lead to a finding of

substantial similarity in a superhero case. Superheroes are set

apart from other fictional characters as a subgenre, primarily

because of their costumes, but in the four cases discussed above,

none of the infringing characters had costumes similar to the

characters they were found to infringe.

225

Nevertheless, other bad

behavior led to a finding of character infringement. In the

Wonderman case, Judge Augustus Hand found that there had been

copying of specific plot elements and panels.

226

The Lynx court

also found copying of panels,

227

as did the Shazam! court.

228

The

court in the Manta and Superstretch case upheld the lower court’s

finding of infringement, but largely presented the case as a contract

termination gone bad.

229

Because MMORPGs like City of Heroes

222

Id. at 1277 (emphasis added).

223

Id.

224

See id. at 1276, 1279.

225

Some early cases looked at brightly colored tights and a cape as infringing, but a

casual glance at the hero pairs would not in itself lead to a finding of substantial

similarity. For a side-by-side comparison of the characters, visit this Note’s companion

website at http://brittonpayne.com/Marvel.html (last visited Apr. 11, 2006).

226

See Detective Comics, Inc. v. Bruns Publ’ns, Inc, 111 F.2d 432, 433 (2d Cir. 1940).

227

See Detective Comics, Inc. v. Fox Publ’ns, Inc., 46 F. Supp. 872, 873

(S.D.N.Y. 1942).

228

See Nat’l Comics Publ’ns, Inc. v. Fawcett Publ’ns, Inc., 198 F.2d 927 (2d Cir. 1952).

229

See Filmation, 486 F. Supp. 1273.

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have guided, but ultimately user-generated, stories in the form of a

video game,

230

there are no comparable elements, only milieu,

name and costumes. The Super Stud and Wonder Wench case sets

out a test for comparing costumes.

5. 1984: Super Stud and Wonder Wench: Seven Costume

Elements are Enough

Unlimited Monkey Business franchised singing telegram

companies to perform skits, including two that featured characters

called Super Stud and Wonder Wench.

231

DC Comics pursued

them under trademark and copyright theories for infringing

Superman and Wonder Woman.

232

The court described the

distinctive Superman costume as having seven essential

components: “(1) blue, skin-tight suit (2) with a yellow five-sided

shield on the chest, (3) emblazoned with the red letter “S”; (4) a

red cape, (5) trunks, and (6) boots; and (7) a gold belt.”

233

The

Super Stud costume was similarly described, differing from

Superman only in the color of the boots, which were black.

234

Wonder Woman was also described on the basis of seven costume

elements.

235

Having selected seven elements and described each

element with a level of specificity, the costumes were found to be

230

See, e.g., Trey Walker, City of Heroes Q&A, GAMESPOT, Oct. 8, 2001,

http://www.gamespot.com/pc/rpg/cityofheroes/news.html?sid=2816738.

231

DC Comics Inc. v. Unlimited Monkey Business, Inc., 598 F. Supp. 110, 112

(N.D. Ga. 1984).

232

Id.

233

Id. at 112 (numbering added).

234

Id. at 114.

235

Id.

In virtually every issue, WONDER WOMAN has worn a costume of patriotic

colors and symbols comprising (1) a red top bearing gold, wing-tipped insignia;

(2) a gold and white star-spangled bottom; and (3) red boots. The costume

consistently has also included the following important accessories: (4) a gold

tiara headband with a red star on it (which also serves as a radio receiver); (5) a

magic lasso or rope which she wraps around her captives to compel them to tell

the truth; (6) a gold belt which enables WONDER WOMAN to compel

obedience; and (7) wrist bracelets on each arm, often used to deflect bullets.

Id. at 113 (numbering added). For a visual illustration of this costume element

breakdown, visit this Note’s companion website at http://www.brittonpayne.com/

Marvel.html (last visited April 11, 2006).

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sufficiently similar when six of the seven elements were the

same.

236

When the court looked at actions taken by the copyrighted

characters, the most significant factor was the extent to which the

actions served as “identifying elements,”

237

an analysis that

implicates consumer confusion and resonates in trademark rather

than copyright.

238

The court also analyzed similarity between the

skits and the original superhero works with a four-part test based

on the (1) plot structure, (2) phrases, (3) costumes and

(4) names.

239

The court found the sketches to be little more than

an adaptation of DC Comics’ original work and not protected by a

defense of fair use parody.

240

The injunction restricted activities

that threatened both trademark and copyright interests.

6. 1983: Greatest American Hero: Visual Impression is

Dominant; Powers are Copyrightable!

In response to the success of the Superman movies of the

1970s, American Broadcasting Corporation (“ABC”) aired the

superhero television program “The Greatest American Hero.”

241

On the show, the character Ralph Hinkley found a colorful and

caped costume that endowed the wearer with incredible powers,

but lost the instruction manual.

242

The show’s three seasons

followed his misadventures as he struggled to master the powers of

the suit while trying to do good.

243

Hinkley’s costume bore little

resemblance to the Superman’s, but Warner Brothers and its

newly-acquired subsidiary DC Comics sued ABC and the show’s

producer Stephen J. Cannell Productions on copyright

236

See id. at 115, 117.

237

Id. at 112.

238

For a further discussion of the separability of copyright and trademark elements in

character (specifically Superman) as it relates to the reversion of copyright, see Kogan,

supra note 71.

239

See Unlimited Monkey Business, 598 F. Supp. at 117.

240

See id. at 119.

241

See Warner Bros. v. Am. Broad. Cos. 720 F.2d 231, 235-6 (2d Cir. 1983).

242

See id. at 236–7.

243

See GreatestAmericanHero.com, Series Info, http://www.greatestamericanhero.com/

main.aspx (last visited Dec. 5, 2005).

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infringement and unfair competition theories.

244

Although the

claims raised involved many aspects of intent in the creation and

promotion of “The Greatest American Hero,”

245

the case ultimately

turned on whether Hinkley was sufficiently similar to Superman

for the claim to survive summary judgment.

246

In analyzing the similarity between the two superheroes, the

court “considered not only the visual resemblance but also the

totality of the characters’ attributes and traits.”

247

The court

suggested that the powers of the characters should be analyzed for

substantial similarity, rather than dismissed as unprotectable

ideas.

248

“[I]f a character strongly resembled Superman but

displayed some trait inconsistent with the traditional Superman

image,” such as villainy, a jury could find infringement.

249

Ironically, the court did not perceptibly follow its own rule.

This case dealt with a character strongly resembling Superman

who displayed a trait inconsistent with the traditional Superman

image, in that Hinkley was inexperienced.

250

However, the court

denied the jury the opportunity to hear the case and determine

whether this was an act of infringement.

251

The standard for

superhero infringement set by this case looks at the way the

244

See Am. Broad. Cos., 720 F.2d at 237–38.

245

ABC had tried to buy the rights to make a Superman television show, and when

rebuffed, set out to create its own version. Id. at 236. ABC assigned Cannell the pitch

for a show about “what happens when you become Superman.” Id. at 236. The first

design for the costume was “a beige and yellow outfit with a white collar and ‘fold-up

wings,’” but Cannell rejected it in favor of “a red and black outfit with a cape, somewhat

similar to Superman’s red and blue costume.” See id. at 246. ABC then promoted the

series using familiar catch-phrases and distinctive music from the Superman movies. See

id. at 237–38.

246

See id. at 235.

247

Id. at 241.

248

“A character is an aggregation of the particular talents and traits his creator selected

for him. That each one may be an idea does not diminish the expressive aspect of the

combination.” Id. at 243.

249

Id. at 243. Such an ambiguous analysis led to the conclusion that a competent

Superman look-alike with similar powers who was a bad guy might be an infringement.

An incompetent character, however, that did not look like Superman but had similar

powers and was a good guy could not infringe as a matter of law. See id.

250

See id. Superman has verve and dash, Hinkley is perplexed and bumbling. See id.

251

See id. at 243. Since Hinkley did not have the “total concept and feel” of Superman,

ABC had made sufficient changes from its Superman starting point, and no reasonable

jury could find substantial similarity. See id. at 241.

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allegedly infringing hero “looks and acts.”

252

However, it fails to

provide a guide for an analysis of appearance, and the guidance it

provides for an analysis of behavioral characteristics is nearly

impossible to follow.

253

The court discusses physical attributes

and costume design,

254

but gives little indication as to how the

weight of the appearance and behavior of the character are

balanced in the decision-making. The court goes to great lengths

to establish behavior as a proper determinant of substantial

similarity in superheroes.

255

The extent and detail of the

discussion suggest that behavior was more important to the

decision than the clearly differing appearance of the characters.

The discussion of the differences in “total concept and feel” of the

central characters of Superman and Hinkley applied to both the

issue of likelihood of confusion and the issue of copyright

infringement.

256

The court cited the similarity of costume

necessary for infringement standard with the Debbie Does Dallas

case, where the pornographic film used “distinctive uniforms

‘almost identical’ with those of [the Dallas Cowboys

Cheerleaders].”

257

In spite of Judge Learned Hand’s guidance, that

“no plagiarist can excuse the wrong by showing how much of his

work he did not pirate,”

258

the court focused on the substantial

differences rather than the substantial similarities.

259

The claim of

similarity in total concept and feel was “plainly” dismissed by

“visual comparison of the works in question.”

260

The driving concern seemed to be the retraction of intellectual

property protection. In its final paragraph, the court notes that

252

Id. at 243.

253

Id. at 241.

254

See id. at 239–43. Hinkley is “of medium height with a slight build and curly,

somewhat unkempt blond hair.” Id. at 236. The costume is “a red leotard with a tunic

top, no boots, and a black cape.” Id. For further comparison of the characters, visit this

Note’s companion website at http://www.brittonpayne.com/Marvel.html (last visited

Apr. 11, 2006).

255

See id. at 243.

256

See id. at 246.

257

See id. at 248, citing Dallas Cowboys Cheerleaders, Inc. v. Pussycat Cinema, Ltd.,

604 F.2d 200, 204–05 & n.8 (2d Cir. 1979)

258

Sheldon v. Metro-Goldwyn Pictures Corp., 81 F.2d 49, 56 (2d Cir. 1936).

259

See Am. Broad. Cos., 720 F.2d at 241.

260

See id. at 247.

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ABC was “surely entitled to urge the District Judge that creativity

and competition could be chilled by the prospect of defending

litigation like this suit.”

261

This chilling should also be a concern

for future superhero infringement cases, but should not justify the

inclusion of unprotectable ideas like good deeds, flight, and

invulnerability into the discussion of substantial similarity. These

are scènes à faire. The court came to the right conclusion that the

Hinkley character did not infringe the Superman character, but did

so for the wrong reasons by moving beyond milieu and appearance

to include powers.

262

7. 2000: Flex Mentallo: Parody Can Protect Obvious Copying

of a Character

Charles Atlas sued DC Comics for its clear copying of the

famous “Hero of the Beach” advertisement, where a skinny kid

gets revenge on his sand-kicking tormentor by developing a

muscular physique using the Atlas bodybuilding courses.

263

DC Comics used a copying of the advertisement as the origin for

its new hero Flex Mentallo in the pages of their comics Doom

Patrol and the subsequent Flex Mentallo.

264

Since the

advertisement was not protected by copyright, Atlas sued on a

trademark theory.

265

The court noted that DC Comics “replicate[d]

261

See id. at 248.

262

In my opinion, the court also wrongly decided the case. Warner Brothers and DC

Comics had ample evidence to show that there was a possibility of substantial similarity

between the characters. Even if the ultimate result would have been the same, the

plaintiffs deserved a jury trial. ABC and Cannell’s questionable promotion practices and

bad intent made a colorable claim for unfair competition and confusion. This could have

led a jury to find infringement similar to that found in Filmation.

263

See Charles Atlas, Ltd. v. DC Comics, Inc., 112 F. Supp. 2d 330, 331 (S.D.N.Y.

2000); see also Gene Kannenberg, Jr., The Ad That Made an Icon Out of Mac, HOGAN’S

ALLEY, http://www.cagle.com/hogan/features/atlas.asp (last visited Dec. 3, 2005)

(detailing the history and incarnations of the Atlas advertisement and its parodies).

264

See Atlas, 112 F. Supp. 2d at 332. Compare, e.g., Hey SKINNY! . . . Yer Ribs are

Showing!, D

ETECTIVE COMICS 182, at Inside Back Cover (Nat’l Comics Publ’ns Apr.

1952) and Charles Atlas, Our Museum, http://charlesatlas.com/classicads2.htm (last

visited Jan. 19, 2006) with, Grant Morrison, Mike Dringenberg, Doug Hazlewood &

Daniel Vozzo, Musclebound, D

OOM PATROL (VOL. 3) 42, at 5 (DC Comics Mar. 1991).

See also Grant Morrison, Frank Quitely & Tom McCraw, After the Fact, Part One:

Flowery Atomic Heart, F

LEX MENTALLO 1 (DC Comics June 1996).

265

See Atlas, 112 F. Supp. 2d at 333.

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key elements of the artwork and dialogue,” including layout,

costume, and the phrase “Hero of the Beach.”

266

In spite of the “obvious visual resemblance,”

267

there was an

equally obvious parody. Thus, the application of the Lanham Act

was construed narrowly, balancing the public interest in free

expression against the public interest in avoiding consumer

confusion.

268

DC Comics had expressly tried to copy the Atlas

characters for its purposes, and the court simply accepted the

substantial similarity between Flex Mentallo and Mac as

“indisputable.”

269

The court’s analysis was strongly influenced by

DC Comics’ intent behind its copying.

270

In spite of the ultimate

ruling that the expression was protected as parody,

271

the intent to

copy made a finding of copying that much more compelling.

272

NCsoft and Cryptic would not likely be able to avail

themselves of a fair use defense on the grounds of parody.

273

Their

attempt to create a world of superheroes is sincere and is not

critical in any way. There may be other fair use arguments, but as

discussed later in this note, they will not likely succeed.

274

266

Atlas was troubled that DC Comics’ advertisement, which ended with the newly

muscular Mac punching the other boy for being a bully, was turned into a scenario with

the newly muscular character punching the girl in the face for being a shallow tramp. See

id. at 332. For further comparison of the Atlas advertisement and Flex Mentallo’s origin,

visit this Note’s companion website at http://www.brittonpayne.com/Marvel.html (last

visited Apr. 11, 2006).

267

See id.

268

See id. at 337.

269

See id. at 332. The court does, however, note that the muscular man in leopard-skin

trunks is not exclusive to Atlas as much as it describes Tarzan, challenging the originality

of the Atlas character. See id. at 341 n.16.

270

See id. at 340.

271

Id. at 340–41.

272

Had the work been protected by copyright, the result would not likely have been

different.

273

“Modern dictionaries accordingly describe a parody as a ‘literary or artistic work that

imitates the characteristic style of an author or a work for comic effect or ridicule,’”

Campbell v. Acuff-Rose Music, Inc., 114 S. Ct. 1164, 1172 (quoting A

MERICAN

HERITAGE DICTIONARY 1317 (3d ed. 1992)). City of Heroes is not attempting to ridicule

superhero culture but to embrace and profit from it. See Ruling on Marvel’s Motion to

Dismiss Counterclaims, supra note 81, at 1–2.

274

See infra Part I.C.

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8. 2000: Black Nova: Fully realized

During Marvel’s bankruptcy proceeding, one of their former

writers and editors Marv Wolfman filed a pro se proof of claim

asserting ownership over many Marvel characters, including “The

Man Called Nova.”

275

Wolfman had previously published a

character called “Black Nova” whom he claimed was the same as

the Nova character he had introduced at Marvel.

276

Black Nova

appeared in two 1967 issues of Wolfman’s fan-magazine

(“fanzine”) “Super Adventures.”

277

A Man Called Nova was

introduced by Wolfman in an eponymous Marvel comic book

in 1976.

278

Wolfman claimed Nova was thus not created under the

work-for-hire agreements he had signed with Marvel and that he

owned the character. Although there was contractual evidence that

Wolfman had no claim, the court compared Black Nova with The

Man Called Nova to see if the preexisting character was “ready for

publication” and thus was not an original contribution under the

Marvel work-for-hire agreement.

279

Under this theory, if Black

Nova and The Man Called Nova were sufficiently similar, they

would fall under the “Siegel exception” and Wolfman would own

rights in both.

280

If they were sufficiently different, then the

character introduced to Marvel was new and was created under a

275

See In re Marvel Entm’t Group, Inc, 254 B.R. 817, 820, 824 (D. Del. 2000).

276

See id. at 824; see also Nova’s Prime Page, Genesis Of Nova: The Evolution of

Marvel’s Ultimate Super-Hero!, http://home.mchsi.com/~nova64/star.htm (last visited

Jan. 26, 2006).

277

Marvel Entm’t Group, 254 B.R. at 824.

278

See id. Compare Len Wein, Marv Wolfman, Who Can Defeat a God?, SUPER

ADVENTURES 7, at 7 (Marvin Wolfman 1967) with Marv Wolfman, John Buscema, Joe

Sinnott & Michele Wolfman, Nova, THE MAN CALLED NOVA 1, at 1 (Marvel Comics

Group Sept. 1976), reprinted in M

ARV WOLFMAN ET AL., ESSENTIAL NOVA VOLUME ONE

(Marvel Comics 2006). A side-by-side comparison of the characters is available at this

Note’s companion website, http://brittonpayne.com/Marvel.html (last visited Apr. 11,

2006).

279

See Marvel Entm’t Group, 254 B.R. at 828–32.

280

See id. at 829. “[C]iting Siegel v. National Periodical Publications, Inc., 508 F.2d

909 (2d Cir. 1974), Wolfman contends that because he developed Nova, Janus, Skull the

Slayer, Blade, and Deacon Frost prior to his employment with Marvel, the characters

were not made at Marvel’s instance and expense.” Id. Thus, the works were not works

for hire, and were properly owned by him and not Marvel.

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work-for-hire agreement, which would deny Wolfman any rights

to the character.

281

The court establishes six factors for finding similarity between

superheroes: name, powers, costume, background story,

personality, and mission.

282

The names and costumes were clearly

similar.

283

However the court found that the background stories

and powers were different, and that Black Nova had no clearly

defined mission at all.

284

There was no analysis of the

personalities.

285

This led the court to find in Marvel’s favor—that

A Man Called Nova was sufficiently different from Black Nova to

be considered an original and non-infringing character.

286

This

result seems to be based on a desire to settle the bankruptcy case

without the Wolfman complication, rather than on whether the two

characters actually were substantially the same.

287

The court’s finding that Black Nova and The Man Called Nova

were not substantially similar is indefensible to the point of

absurdity—even upon its own description. However, the case

provides a good framework for determining which features are

appropriate for comparison of superheroes, in particular, power

combinations. The court’s analysis ignores the fact that with the

thousands of superhero and supervillain properties, the

combinations of powers are so widely reproduced in comic book

practice that it is almost ensured that there will be no exclusive use

of particular power combinations, no matter how innovative.

288

281

See id. at 829–32.

282

See id. at 824.

283

Id. at 831.

284

Id.

285

See id.

286

See id.

287

The degree of character development required in a superhero case is a considerably

lower obstacle as articulated by Judge Posner in Gaiman v. McFarlane, 360 F. 3d

(7th Cir. 2004), discussed infra in Part I.A.9.

288

The early Justice League of America charter acknowledges the frequency of power

replication by forbidding duplication of powers among its membership, although the

initial reason for denying membership to Hawkgirl was based on a “one new member at a

time” clause. See Gardner Fox, Mike Sekowsky & Bernard Sachs, Riddle of the Runaway

Room!, J

USTICE LEAGUE OF AMERICA 31 (DC Comics, Nov. 1964), reprinted in GARDNER

FOX ET AL., JUSTICE LEAGUE OF AMERICA ARCHIVES: VOLUME FIVE (DC Comics 1999).

For readers concerned with comic book minutiae, the power duplication clause was

subsequently changed under duress to allow membership to Hawkman’s identically-

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The industry has tolerated power duplication where other elements

are different, like costume and name.

289

However, duplication of

other elements is not excused by power differentiation,

290

powers should not be a significant factor in superhero analysis.

291

9. 2004: Medieval Spawn: Appearance is Everything

Gaiman v. McFarlane offers insight to the protections afforded

characters in general, and superheroes in particular.

292

Todd

McFarlane created a comic book featuring his new character

Spawn, but was criticized for his writing skills,

293

so he brought on

Neil Gaiman to write an issue.

294

Gaiman wrote three new

characters in the issue, penciled by McFarlane, including a

predecessor of the lead character later dubbed Medieval Spawn.

295

Due to contractual issues, the case turned on whether Gaiman was

a co-creator, and whether Medieval Spawn was a copy of Spawn,

or a new derivative character.

296

Judge Posner found that similar

characters without sufficiently substantial differences may be

considered derivative.

297

Of course, a derivative character created

without the permission of the owner of the copyright in the

underlying character infringes upon the holder’s rights.

298

The

“doctrine [of scènes à faire] teaches that ‘a copyright owner can’t

powered wife Hawkgirl. See Steve Englehart, Dick Dillin, Frank McLaughlin & Anthony

Tollin, Inner Mission!, J

USTICE LEAGUE OF AMERICA 146 (DC Comics Sept. 1977). The

story is summarized at Scott Tipton, Comics 101: Final Recruits—The Justice League Of

America, Part IV, MOVIE POOP SHOOT, Feb. 2. 2005 http://www.moviepoopshoot.com/

comics101/101.html.

289

See infra Part I.B.

290

Id.

291

See infra Part VI.D. and accompanying notes.

292

See 360 F.3d 644, 661 (7th Cir. 2004).

293

See id.at 649; see also Todd McFarlane & Steve Oliff, Questions, SPAWN 1 (Image

Comics, May 1992) (first appearance of Spawn), reprinted in T

ODD MCFARLANE ET AL.,

SPAWN COLLECTION VOLUME ONE (Image Comics 2005).

294

See Gaiman, 360 F.3d at 649.

295

See id. at 650; see also Neil Gaiman, Todd McFarlane, Steve Oliff & Reuben Rude,

Angela, S

PAWN 9 (Image Comics, Mar. 1993) (first appearance of Angela, Medieval

Spawn, and Cagliostro).

296

See Gaiman, 360 F.3d at 652, 661.

297

Id.

298

17 U.S.C. § 106(2) (2000) (defining a copyright holder’s rights as to derivative

works).

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prove infringement by pointing to features of his work that are

found in the defendant’s work as well but that are so rudimentary,

commonplace, standard, or unavoidable that they do not serve to

distinguish one work within a class of works from another.’”

299

Although the discussion focused on stock characters, the analysis

appropriately parallels a discussion of stock powers, such as those

implicated in Marvel v. NCsoft. The listing of powers and

attributes may be a description of an unprotectable stock character,

and may only become sufficiently distinctive to be copyrightable

and subject to infringement analysis when drawn and named.

300

B. When Comparing Superheroes, Look at Names, Costumes and

Text, Not Powers or Plots

When determining infringement in the milieu of superheroes,

character names will be evaluated under traditional trademark

analysis, which seeks to avoid consumer confusion and protect

earned good will.

301

Specific expressions of superheroes, like

costumes, panels and dialogue, will be analyzed under traditional

specific drawings or dialogue, there is infringement. In spite of the

Greatest American Hero case,

302

power combinations and general

motivation are scènes à faire, and should not enter the analysis

when determining infringement in superheroes. Characters with

identical powers and motivations should not be found to infringe if

they have sufficiently different names and costumes.

In an infringement suit involving a video game like City of

Heroes, in which the player designs his character within the

game’s parameters and creates his own dialogue,

303

courts have an

opportunity to analyze the copying of characters almost completely

299

Gaiman, 360 F.3d at 659, (citing Bucklew v. Hawkins, Ash, Baptie & Co., 329 F.3d

923, 929 (7th Cir. 2003)).

300

See id. at 661.

301

See Lanham Act § 32(1), 15 U.S.C. § 1114(1)(a) (2000) (imposing liability on a

person whose mark used in the sale of a product is “likely to cause confusion”); Polaroid

Corp. v. Polarad Elecs. Corp., 287 F.2d 492, 495 (2d Cir. 1961) (detailing factors for

evaluating the likelihood of confusion).

302

See supra Part I.A.6.

303

See CITY OF HEROES GAME MANUAL 5–11, 110–13 (Cryptic Studios, Inc. and NCsoft

Corp. 2004), available at http://www.cityofheroes.com/gameinfo/documentation.html.

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apart from the works in which they originally appeared. Prior

cases have looked to copying of panel art, character behaviors, and

dialogue

304

none of which is implicated in a video game, where the

poses, actions and text are determined by the user. Costume

should be the prime determinant when looking for substantial

similarity between protected superheroes and those which are

allegedly infringing. Because of technological limitations of the

genre at its inception, simple, brightly colored and costumes are

standard and defining genre identifiers. The industry has two

major players, DC Comics and Marvel, who have essentially

duplicated many of each other’s characters in every aspect except

name and costume, without bothering to engage in legal action.

305

This détente should be ratified in the courts when comparing

superheroes in a substantial similarity analysis.

306

If the names and

costumes are sufficiently different, there should be no finding of

infringement, regardless of other similarities in origin, demeanor,

or “mission.”

307

Where there is substantial similarity in costume,

character infringement is appropriately found. Intent to copy

should be a thumb on the scale in this equation where the question

of substantial similarity is a close one.

308

The similarity should be judged in the context of the infringing

medium, not the infringed medium. For example, a City of Heroes

character that is allegedly infringing should not be compared to the

comic book version of that character, but to what a direct

translation of the character into the video game would look like.

Without knowing more than is seen in the exhibits submitted by

Marvel, it is clear that the Hulk and Wolverine characters

infringe.

309

A licensed City of Heroes Incredible Hulk would be an

304

See supra Part I.A. and accompanying notes.

305

See infra Part VI.D.

306

Cf. Popov v. Hayashi, No. 400545, 2002 WL 31833731, at *1, *5 (Cal. Super. Ct.

Dec. 18, 2002). This case confronted the question of whether legal possession of Barry

Bonds record-breaking home run should be influenced by fan expectation for the ordinary

ball hit into the stands. “There is no reason for the legal rule to be inconsistent with that

expectation.” Id. at *5.

307

Dialogue and panels are, of course, subject to traditional copyright analysis. See

17 U.S.C. § 102 (2000).

308

The margins are more carefully considered infra Part VI.B.–C.

309

See Exhibit L, Marvel Enters., Inc. v. NCsoft Corp., No. CV 04-9253-RGK (PLAx)

(C.D. Cal. Aug. 22, 2005), available at http://www.eff.org/IP/Marvel_v_NCSoft/

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oversized male with green skin, purple short pants and no other

significant costume elements. Where that combination appears in

the game without approval, it infringes Marvel’s rights in the

character. Due to present technical limitations, the City of Heroes

Creation Engine would not allow a hypothetical authorized

Wolverine to have precisely the same costume he has in his

original incarnation in comic books.

310

Therefore, it is appropriate

to compare the allegedly infringing character and the closest

manifestation possible of that character in the video game.

C. The City of Heroes User-Created Characters Directly Infringe

For copyright protection, materials must be copyrightable.

311

Little guidance exists to assist in determining whether a character

is copyrightable. Some courts may do a filtration test, sifting out

the unprotectable elements to rule only on infringement of the

sufficiently original elements.

312

In some cases, the combination

of elements itself may be the original creation, even if all of the

individual parts are from the public domain, so others are free to

use the elements as long as they don’t copy the combination.

313

Evidence of copying can be inferred by evidence of access and

substantial similarity.

314

The characters at issue are copyrightable as a matter of law.

315

Because of the widespread penetration of Marvel superheroes in

the popular culture, especially among consumers of video games,

access would not be difficult to show. A character in a video game

that is inspired by a movie or comic book character may infringe

on the rights of the character’s owner as a copy, or as an

ExhL.pdf; Exhibit O, Marvel Enters., Inc. v. NCSoft Corp., No. CV 04-9253-RGK

(PLAx) (C.D. Cal. Aug. 22, 2005), available at http://www.eff.org/IP/Marvel_v_

NCSoft/ExhO.pdf.

310

Wolverine’s distinctive flared headgear, boots and claw-mark-bedecked torso can be

approximated but not duplicated by the Creation Engine.

311

See, e.g., Sapon v. DC Comics, 00 Civ. 8992, 2002 U.S. Dist. LEXIS 5395, at *15

(S.D.N.Y. Mar. 29, 2002).

312

See, e.g., id. at *20–26.

313

See id. at *27. For example, there are 88 keys on a piano, none of which can be

copyrighted, but an original combination of them can be. See, e.g., Newton v. Diamond,

388 F.3d 1189, 1197 (9th Cir. 2004) (Graber, J., dissenting).

314

See, e.g., Selle v. Gibb, 741 F.2d 896, 900–01 (7th Cir. 1984).

315

See, e.g., Gaiman v. McFarlane, 360 F.3d 644, 648, 661 (7th Cir. 2004).

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unauthorized derivative work if it is not an exact copy but is

materially similar.

316

Either violation carries the same liability.

317

Although there are many tests for determining substantial

similarity with superheroes, it is ultimately an ad hoc analysis.

318

The copying of names is not prohibited by copyright, but can be

evidence of intent to infringe.

319

In comparing the characters

created in City of Heroes by Marvel

320

with their copyrighted

characters, it would be difficult to find that there is not sufficient

similarity, based on the prior comparisons found above.

321

Substantial similarity between an allegedly infringing character

and the protected character’s translation into the new medium is

not the only form of character infringement in a MMORPG. A

City of Heroes character that is significantly different from a

protected character but could be identified as a derivative

character, such as “Mutant Winnie the Pooh,”

322

would also

infringe.

323

City of Heroes may be on the hook not only for users

who intend to create the closest facsimiles of the protected

characters that they can, but also for users’ intentional

interpretations and derivations of those characters.

316

See, e.g., id. at 661.

317

rights to reproduce a copyrighted work and to create derivative works).

318

See supra Part I.A. and accompanying notes.

319

See Universal City Studios, Inc. v. Film Ventures Int’l, Inc., 543 F. Supp. 1134, 1141

(C.D. Cal. 1982).

320

As part of its case, Marvel intentionally created characters in City of Heroes based on

their own protected characters to justify their DMCA claim.

See Ruling on Marvel’s

Motion to Dismiss Counterclaims, supra note 81, at 2. The screen captures of these

characters are posted in this Note’s companion website, at http://brittonpayne.com/

Marvel.html (last visited Apr. 11, 2006).

321

See supra Part I.A and accompanying notes.

322

See, e.g., Crey Industries, Hero Threat Database: Mutant Pooh,

http://www.creyindustries.com/viewhero.php?id=10783 (last visited Dec. 5, 2005).

323

Cf. Gaiman v. McFarlane, 360 F.3d 644, 648, 661 (7th Cir. 2004). But see Castle

Rock Entm’t, Inc. v. Carol Publ’g Group, Inc. 150 F.3d 132, 143 n.9 (2d Cir. 1998)

(noting that even when one work is “based upon” another, “if the secondary work

sufficiently transforms the expression of the original work such that the two works cease

to be substantially similar, then the secondary work is not a derivative work and, for that

matter, does not infringe the copyright of the original work”).

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D. City of Heroes Implicates Direct Infringement through Joint

Ownership

In addition, City of Heroes could potentially be a direct

infringer as a joint author of the user-generated character. This

potentially exposes Cryptic and NCsoft to a great deal more

liability than is considered in the Marvel complaint. Ordinarily,

when two parties work together to create a single work, they are

considered joint authors of the work.

324

A comic book writer and

artists contribute in different ways to the creation of a new

character, and jointly own that character.

325

In a video game

context, this might imply joint ownership of characters created by

the user’s selection of elements provided by the game. Such a

character created with contributions from the player and the game

could be found a joint work, wholly-owned by both the user and

the game-maker, subjecting the game-maker to liability for direct

infringement.

Another view is that the game is only providing its users with

character elements (powers, body-types, colors, patterns and

symbols) from the public domain, so the game-maker’s

contribution is not what makes the character infringing. However,

the game-maker may subsequently own the character according to

the EULA. The game-maker may be directly infringing, as it

acquires the rights and responsibilities of the user as a joint or

independent creator. Alternatively, the EULA may be crafted such

that the game-makers do not take ownership of infringing works

and do not claim rights to joint works that infringe.

A close reading of a EULA might suggest that a game operator

assumes all rights to the materials created. If there is no right to

create infringing characters, then by the terms of the EULA, they

do not take over the right. But if there is no prohibition on the

creation of infringing characters and the game-makers thus do take

the rights of the infringing character, then the game-maker may not

be able to claim the safe harbors of the DMCA, which only protect

324

17 U.S.C. § 101 (2003) (“A ‘joint work’ is a work prepared by two or more authors

with the intention that their contributions be merged into inseparable or interdependent

parts of a unitary whole.”).

325

See Gaiman, 360 F.3d at 659.

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against claims of secondary liability. Where a game-maker owns

the infringing character, they are directly liable.

Additionally, EULAs can be expected to have indemnity

clauses, potentially relieving game-makers of liability for the

actions of their users in violation of third-party intellectual

property rights. The City of Heroes EULA includes such an

indemnity clause in the section on ownership of content.

326

indicates that the game-makers own user-created content, including

characters.

327

However, the EULA also suggests that where the

game-makers are prevented from ownership “by operation of law,”

they are granted the unlimited right to use the content.

328

This

acknowledgement of “operation of law” may be intended to

suggest that no ownership transfers in infringing materials.

However, physical materials that infringe can certainly be sold,

thus transfer of the intellectual property ownership and its

attendant responsibilities should not be barred by such “operation

of law.”

Game-makers must be careful how they construct their EULAs

to make clear that they may be joint authors of noninfringing

works who then assume whole ownership, or that users are

creating works for hire which they subsequently license from the

game-makers, but that the game-makers never claim intent to

create or ownership in infringing works, and are only liable

secondarily with regards to such works.

E. Skins: Importing a Superhero Costume

The City of Heroes software does not stop players with average

computer skills from hacking the game and playing an infringing

character.

329

Presently, copyrighted and trademarked character

elements like distinctive logos and costume patterns can be

brought into a user’s game with readily available instructions.

330

326

See City of Heroes User Agreement, supra note 93, at § 6(c).

327

Id. at §§ 6(b)–(c).

328

Id. at § 6(c).

329

See infra Part I.E.

330

Id.

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This is a common practice in the videogame world,

331

and City of

Heroes is no exception.

Although it is the only method noted in Marvel’s suit, a

Creation Engine is not the only way an infringing character can

appear in a video game. Computer users can customize the

appearance of a program by downloading or creating a “skin.” A

skin is a graphic file that effectively wraps around a program or

program element the way a patterned sock wraps around a foot,

332

changing its appearance but not its underlying function. It has

become common practice for some players to use skins to create

their own characters to play in videogames.

333

Players use a

separate program to design a look for a character, and store the

instructions for creating that look on the hard drive where the game

searches for approved skins. When the game is played, it

substitutes the homemade skin for the licensed skin.

334

There are

websites that allow players to download skins created by others for

use in their games.

335

Although some game-makers encourage the

use of skins, many forbid the practice in the interest of protecting

the integrity of their game and the underlying character properties.

This practice is the source of a lawsuit where skins were used to

make the characters in a volleyball video game appear naked.

336

331

Id.

332

See Alex’s Freedom Fortress, Alex’s Fantastically Fabulous Freedom Force FAQ:

Skins and Meshes, http://www.alexff.com/faq.htm#16._What_are_Skins_What_are_

Meshes (last visited Dec. 5, 2005).

333

See id. (displaying hundreds of skins used by players of the video game Freedom

Force).

334

See id.

335

See, e.g., Alex’s Freedom Fortress, http://www.alexff.com/ (last visited

Dec. 5, 2005). Alex’s Freedom Fortress offers hundreds of unapproved skins of

superhero properties for the superhero video game Freedom Force. Id. For a more

thorough discussion of the use of skins, see Alex’s Freedom Fortress, Alex’s

Fantastically Fabulous Freedom Force FAQ: Skins and Meshes, http://www.alexff.com/

faq.htm#16._What_are_Skins_What_are_Meshes (last visited Dec. 5, 2005).

336

See David Becker, Game Maker Sues Over Nude Volleyball, CNET NEWS.COM, Feb.

10, 2005, http://news.com.com/Game+maker+sues+over+nude+volleyball/2100-1043_3-

5571234.html. Compare Saiyaman.info, Dead or Alive Wallpaper,

http://www.saiyaman. info/ gallery/displayimage.php?album=7&pos=16 (last visited

Dec. 5, 2005) (unaltered screenshots from the game) with Prostar Games, Dead or Alive

Xtreme Beach Volleyball—Nude/Topless mode, Dec. 15, 2004, http://prostar-

games.com/ (the offending ‘nude’ versions). The parent company of Tecmo, the game-

maker discussed in Becker, supra, won a similar case in Japan two years ago in which it

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City of Heroes can be similarly manipulated.

337

The Creation

Engine has a selection of over one hundred logo choices, none of

which infringe any copyright.

338

Independent websites offer free

files that can replace one of the logos that the game initially offers,

allowing the user more choices, including the Spider-man logo,

Batman’s chest logo and the Superman “S”-shield.

339

To find

similarity in superhero logos, the court will only need to look at

“substantial similar[ity] to the eye of an ordinary consumer.”

340

Because City of Heroes skins are stored on the user’s computer,

they are not visible to players on other machines, or to the City of

Heroes game operators.

341

With widespread skin use and the

current technical specifications, users can easily play whatever

characters they want on any game platform, using protected

characters without going through licensed channels at all.

Another form of skinning can potentially be used in City of

Heroes. A user can spend the time to create the visual image of a

character, then forward that particular combination of appearance

characteristics to another user, or post it online at an infringing

tutorial site. Marvel has already pursued users who distributed

sued distributors of a naked hack for the action game “Dead or Alive II.” Becker, supra;

Mucho Sucko, Naked Dead or Alive 2, http://www.muchosucko.com/video-

nakeddeadoralive2.html (last visited Jan. 26, 2006).

337

Some news reports incorrectly suggest that skins cannot be used in City of Heroes.

Compare Matt Brady, Marvel Sues City of Heroes Producers, NEWSARAMA.COM,

http://newsarama.com/forums/showthread.php?s=&threadid=21377 (last visited

Dec. 5, 2005), with, e.g., Coldfront, City of Heroes Costume Mods,

http://coh.coldfront.net/index.php/content/category/10/73/63/ (last visited Dec. 5, 2005).

The whole process is illustrated in this Note’s companion website, at

http://brittonpayne.com/Marvel.html (last visited Apr. 11, 2006).

338

The selection of letters of the alphabet, abstract designs, and public domain symbols

is illustrated in this Note’s companion website, at http://brittonpayne.com/Marvel.html

(last visited Apr. 11, 2006).

339

See, e.g., Coldfront, supra note 337.

340

See DC Comics, Inc v. Bobtron Int’l, Inc., No. 89 Civ. 4358, 1990 U.S. Dist. LEXIS

9107, at *4–5 (S.D.N.Y. July 25, 1990) (citing Novelty Textile Mills, Inc. v. Joan Fabrics

Corp., 558 F.2d 1090, 1093 (2d Cir. 1977)) (comparing a watch with a white bat-logo on

a black background and the copyrighted Batman emblem).

341

For a tutorial and some examples, see City of Heroes Guru, City of Heroes Guru

Forum, http://www.cohguru.com/forum/showthread.php?t=1824 (last visited Jan. 26,

2006).

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skins for the superhero video game Freedom Force.

342

It has not

yet pursued City of Heroes for allowing its rogue users to hack its

software to create even closer representations of its characters.

The legal issues raised with regards to skins would be similar to

the claims Marvel brought, even though the factual inquiry would

focus on a more sophisticated user. NCsoft and Cryptic are surely

aware of consumer use of skins as well as their creation of

infringing characters through the Creation Engine. However,

pending terms of the settlement, City of Heroes is not adequately

preventing either activity in order to protect the interests of the

F. The Super Hero and Super Villain Trademarks Should be

Generic

Part of the inducement problem for NCsoft and Cryptic Studios

is the difficulty in describing their product to consumers. Any

typical person describing City of Heroes would call it something

like “the superhero video game.”

343

Unfortunately, City of Heroes

is forced to dance around the term “super hero,” because it is a

trademark co-owned by Marvel and DC Comics.

344

Because

inducement is such a significant element in liability analysis for

third-party infringement under Grokster,

345

vendors of superhero

342

See Matt Brady, Marvel Stomps Skin Site, NEWSARAMA.COM, June 23, 2003,

http://www.newsarama.com/forums/showthread.php?s=6300d02c8a340e184b36a3c427e

7fe2e&threadid=4234&highlight=skins.

343

Superhero: “A figure, especially in a comic strip or cartoon, endowed with

superhuman powers and usually portrayed as fighting evil or crime.” THE AMERICAN

HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE 1802 (3d ed., Houghton Mifflin

Co. 1996). “A superhero is a fictional character who is noted for feats of courage and

nobility, who usually has colorful name and costume and abilities beyond those of normal

human beings.” Wikipedia, Superhero, http://en.wikipedia.org/wiki/Superhero (last

visited Jan. 26, 2006).

344

Word Mark SUPER HEROES, Serial No. 73222079 (1981); available at

http://www.uspto.gov/main/trademarks.htm (select “Search Trademarks” under “Get a

Trademark Registration”; then select “New User Form Search” and enter the term “super

heroes” into the “Search Term” box; then select the trademark with the corresponding

serial number); see Brian Cronin, Comic Book Urban Legends Revealed #9!, C

OMICS

SHOULD BE GOOD, July 28, 2005, http://goodcomics.blogspot.com/2005/07/comic-book-

urban-legends-revealed-9.html.

345

See Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 125 S. Ct. 2764, 2770

(2005).

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products not licensed by Marvel or DC Comics run the risk of

getting tripped up in their efforts to avoid that unreasonable

trademark restriction, as NCsoft and Cryptic were here.

The word mark “super hero” and its variants should be deemed

generic. When DC Comics and Marvel jointly registered the term

in 1979,

346

“super hero” was already the widespread generic term

to define a comic book subgenre and its distinctive characters.

347

Because no one challenged the trademark registration, it was

approved two years later.

348

But where a trademarked word has

“[become] part of the public domain,”

349

it is a victim of

“genericide”—a killing of the distinctiveness of the mark

350

—and

can no longer support a claim that it deserves the monopoly

granted by trademark law on the basis of preventing consumer

confusion and identifying the source of a product.

351

“Super hero”

is such a mark.

In a leading case, the trademarked term “Thermos” was held

generic because the court determined by survey evidence that it

had entered the public domain.

352

In a leading case on genericide

346

For a full discussion of the trade-marking of the term, see Todd VerBeek, Super-

Heroes® a Trademark of DC and Marvel, BRIEFS ON THE OUTSIDE: THE LAW AND

COMICS, http://briefs.toddverbeek.com/archives/000152.html (last visited Nov. 27, 2005).

347

See, e.g., GERARD JONES, MEN OF TOMORROW: GEEKS, GANGSTERS, AND THE BIRTH

OF THE

COMIC BOOK 74 (Basic Books 2004) (“By 1932 [Street & Smith, publisher of the

Shadow,] was already preparing more pulps [(novels)] starring crime fighters of

superhuman prowess and distinct appearance. Soon its editors had developed an in-house

word for the type of character: ‘superhero.’”). The term was used generically in comic

books as early as 1942. Will Murray, The Pulp Connection: The Roots of the Superman!,

OMIC BOOK MARKETPLACE, Sept.–Oct. 1998, at 20; see George Marcoux, SUPERSNIPE

COMICS (VOL. 1) 1, at Cover (Street & Smith Oct. 1942) (picturing a sleeping boy on the

cover holding a magazine entitled “Super Hero Comics”); Joe Simon & Jack Kirby, The

Guardian, S

TAR SPANGLED COMICS 7 (DC Comics Apr. 1942) (first appearance of the

Guardian and the Newsboy Legion), reprinted in Joe Simon & Jack Kirby, The Newsboy

Legion, A

DVENTURE COMICS DIGEST 503, at Ch. 8 (DC Comics Sept. 1983). The term

did not catch on widely in its current usage until the Silver Age of Comics, in the late

1950s. See Murray, supra.

348

See VerBeek, supra note 346.

349

King-Seeley Thermos Co. v. Aladdin Indus., Inc., 321 F.2d 577, 579 (2d Cir. 1963).

350

BLACK’S LAW DICTIONARY 707 (8th ed. 2004).

351

See King-Seeley Thermos, 321 F.2d at 579, 581.

352

See id. at 579–80.

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survey evidence,

353

E.I. DuPont de Nemours & Co. v. Yoshida

International (the “Teflon” case), each side presented several

different kinds of surveys supporting their position.

354

The court

identified the test that best determined whether the mark TEFLON

was appropriately in the public domain as “Teflon Survey B.”

355

There, the surveyor described the categories of “brand name” and

“common name” with the respective word pair “Chevrolet—

automobile” and asked whether each of eight names was a brand

name or a common name.”

356

If Teflon Survey B were conducted for “super hero” and “super

villain,”

357

it would be surprising if either term were identified by a

significant percentage as a brand name.

358

“The primary

significance of the registered mark to the relevant public rather

than purchaser motivation shall be the test for determining whether

the registered mark has become the generic name of goods or

services on or in connection with which it has been used.”

359

mark shall be deemed to be “abandoned” when, due to any course

of conduct of the registrant, including acts of omission as well as

commission, the mark loses its significance as an indication of

origin.

360

“Superhero” has at least become part of the public

353

JANE C. GINSBURG, JESSICA LITMAN & MARY KEVLIN, TRADEMARK AND UNFAIR

COMPETITION LAW 332 (3d ed., Foundation Press 2001).

354

393 F. Supp. 502, 518–20 (E.D.N.Y. 1975).

355

See id. at 526–27.

356

Id. The survey found at least three out of four people responded “brand name” for

STP, Jello, and Coke, and “common name” for Margarine, Refrigerator and Aspirin. Just

over two-thirds identified Teflon as a brand name. The people surveyed were fairly

evenly split on Thermos. The court found this to be the survey “which really gets down

to th[e] critical element” of “whether the principal significance of the name [] was ‘its

indication of the nature or class of an article, rather than an indication of its origin.’” Id.

at 527 (citing King-Seeley, 321 F.2d at 580). The court found that Teflon was not generic

because a “substantial majority of the public continues to believe that TEFLON is a brand

name.” DuPont, 393 F. Supp. at 527. A previous court had found that Thermos had

become generic. King-Seeley, 321 F.2d at 579.

357

Cf. DuPont, 393 F. Supp. at 526–27.

358

Even in the almost obsessively sophisticated superhero comic book market,

consumers are surprised to discover that “super hero” is trademarked. See, e.g., Matt

Brady, Super Hero Happy Hour Changes Name, N

EWSARAMA.COM, Jan. 30, 2004,

http://newsarama.com/forums/showthread.php?s=&threadid=8650 (discussing reactions

to the “Super Hero Happy Hour” comic book cease and desist letter).

359

See 15 U.S.C. § 1064(3) (2000).

360

See id. at § 1127.

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domain if it has not been there since its coinage in the 1930s, and it

is unfair to unduly restrict the right of a competitor of DC Comics

and Marvel to use the word.

361

There is evidence that DC Comics

and Marvel have been diligent in their efforts to protect the

trademark significance of “super hero,”

362

as required by Du Pont,

the leading “genericide” case.

363

However, they seem to have

failed in preventing the mark from becoming principally

significant as a common noun,

364

which is considered under

DuPont.

365

The terms seem to be generic, and thus should be

available for City of Heroes and any other company offering a

product based on a “brightly costumed super-powered hero” to use

in trade.

Furthermore, there is a strong nominative fair use argument for

the term “superhero” in the context of City of Heroes.

366

The

Ninth Circuit may be particularly sympathetic to this argument,

based on their finding in Playboy Enterprises v. Welles.

367

Terri

Welles had been selected “Playboy’s Playmate of the Year 1981,”

but Playboy objected to her use of the term on her website.

368

The

court found that Welles’ use was nominative fair use, commenting

that trying to identify Welles for her website without using the

trademarked phrase was “absurd . . . [t]o describe herself as the

‘nude model selected by Mr. Hefner’s magazine as its number-one

prototypical woman for the year 1981’ would be impractical as

well as ineffectual in identifying Terri Welles to the public.”

369

City of Heroes finds itself in a similar situation, trying to identify a

361

Cf. King-Seeley, 321 F.2d 577.

362

See, e.g., Brady, supra note 358 and accompanying text.

363

See DuPont, 393 F. Supp. at 527–28.

364

See, e.g., THE AMERICAN HERITAGE DICTIONARY OF THE ENGLISH LANGUAGE 1802

(3d ed., Houghton Mifflin Co. 1996); Wikipedia, Superhero, http://en.wikipedia.org/

wiki/Superhero (last visited Jan. 26, 2006).

365

See DuPont, 393 F. Supp. at 527–28.

366

Nominative fair use “acknowledges that it is often virtually impossible to refer to a

particular product for purposes of comparison, criticism, point of reference or any other

such purpose without using [plaintiff’s] mark.” Horphag Research Ltd. v. Pelligrini, 337

F.3d 1036, 1041 (9th Cir. 2003) (internal quotations omitted).

367

279 F.3d 796 (9th Cir. 2002).

368

See id. at 799–800.

369

Id. at 802.

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superhero video game to the public without infringing the

trademarked expression “super hero.”

It is unreasonable that Marvel should be able to suggest that

using the phrase “brings alive the world of comic books” is

inappropriate inducement to infringe when it is just as likely that

City of Heroes is hamstrung by its inability to use the generic term

“superhero” to more directly describe its product. If the term is not

considered generic, the use of the trademarked term “super hero”

should be considered nominative fair use for the description of

superhero products.

VI. A

FAIR FILTERING SOLUTION

Judge Posner suggests a solution for dealing with enablers in In

re Aimster Copyright Litigation.

370

His law and economics

analysis suggests that “[i]f a [copyright infringement] can be

prevented most effectively by actions taken by a third party, it

makes sense to have a legal mechanism for placing liability for the

consequences of the breach on him as well as on the party that

[infringed.]”

371

The opinion indicates that companies that facilitate

infringement, even if they are not infringers themselves, may be

liable to the copyright owners as contributory infringers.

372

Chasing down the individual infringers is “a teaspoon solution to

an ocean problem.”

373

He outlines a two step process: if (1) there

is not substantial noninfringing use and (2) filtering is not unduly

burdensome, then there should be contributory liability.

374

Posner’s solution is inadequate for two reasons. First, his rigid

ordering of the potential solutions precludes imposition of a

filtering solution where infringement does not reach the

substantiality threshold, even if the filtering solution carries a low

cost relative to the damage caused by its absence. A multi-factor

analysis would instead allow a court to take into account the many

370

371

Id.

372

Id. at 645.

373

Id. at 645 (citing Randal C. Picker, Copyright as Entry Policy: The Case of Digital

Distribution, 47 ANTITRUST BULL. 423, 442 (2002)).

374

See id. at 653.

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factors present in a digital infringement case. Second, Posner’s

factors do not consider the need to give some technologies room to

grow to their full potential before imposing filtering solutions that

may stunt their growth. His test also does not consider culpability

for the foreseeability of the new technology infringing intellectual

property rights and the precedential hazards of not adequately

preventing infringement in its development.

A fair solution will adequately balance the interests in

protecting characters from infringement with the need to avoid a

potential chilling effect in administration of the game. The

following steps will find a fair balance where there is digital

infringement of character copyright and trademark.

A. Calibrating Notice and Knockdown for Continuing

Relationships

In the context of City of Heroes, Notice and Knockdown

should be based on the material that is infringed—not the infringer

or the infringement. A copyright owner should be able to give

notice of material that is infringed and knock down the ability to

infringe. As it stands, only the infringement is enforced against,

knocking out the character and in egregious cases, the infringer,

banning the user. Since the infringer is generally a fan, Marvel has

no incentive to punish him

375

personally, particularly if it can

simply prevent him from infringing.

376

Marvel’s real goals are to

prevent NCsoft and Cryptic from benefiting unfairly from the work

Marvel owns, and from decreasing the value of the future use of its

375

As most would assume, “95 percent of all comic-book readers are male.” See Julia

Duin, Comics Still Flying High; Colorful Heroes Deliver Messages Around the World,

ASH. TIMES, Feb. 6, 2002, at A02, available at http://www.nyccomicbookmuseum.org/

Wash_Times_2_6.htm. But see Stevie Case, Women in Gaming, M

ICROSOFT.COM,

Jan. 12, 2004 http://www.microsoft.com/windowsxp/using/games/learnmore/

womeningames.mspx (“[W]omen now account for 43% of all computer gamers. . . .

[R]esearch reveals that 30% of gamers who play more than 10 hours a week are

female.”).

376

A close reading of the settlement press release makes it clear that alienation of the

fans is a primary concern for Marvel. See Press Release, NC Soft, Marvel Entertainment,

Inc., NCsoft Corporation, NC Interactive, Inc., Cryptic Studios, Inc. Settle All

Litigation, (Dec. 14, 2005), available at http://www.plaync.com/about/2005/12/

marvel_entertai.html; see also Brady, supra note 8 and accompanying responses.

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properties.

377

A filter should recognize the infringement of the

protected character, and prevent that character from being created

or used, without requiring notice of the individual infringement.

B. Name: The Trademark String Solution

NCsoft and Cryptic already operate a City of Heroes “Block

List” for the naming aspect of its Creation Engine.

378

If a user tries

to name his character “Hulk,” the program will prevent it, and

suggest trying another name. The game-makers may add strings to

the Block List,

379

such that if the word “Hulk” appears in any part

of the word, it will also be blocked, i.e. “Hulk10.” This feature

also prevents the use of obscenities in the character naming.

Additionally, it has the ability to block out “cobbles,” intentional

misspellings or combinations of characters that are clearly intended

to evade the Block List’s purpose, such as “H_U_L_K,” “Hu1k” or

“HU£K.”

380

The Block List can have a feature that understands

common cobbling techniques, effectively translating the coded

word back to its proper form and matching it to words on the

Block List. It is not truly a list, but an algorithm, a small program

that evaluates word choices and weeds out the ones that violate the

rules. It operates as a filter, which requires periodic updating, but

is not monitoring, which is not required for the DMCA safe harbor

provisions.

381

It is not unreasonable to expect this filter to follow

377

In the summer of 2005, Marvel announced a deal with Microsoft to create a licensed

MMORPG featuring the Marvel characters, and DC Comics has a similar deal with Sony.

See Schiesel, supra note 46.

378

See Ruling on Marvel’s Motion to Dismiss Counterclaims, supra note 81, at 1.

379

Strings in computer language, sometimes represented by the dollar sign ($), stand for

any number of symbols. Wikipedia.com, Dollar sign, http://en.wikipedia.org/wiki/%24

(last visited Mar. 29, 2006). Thus a search for “$Hulk$” would generate results such as

“Hulk10,” “Mr. Hulk,” or “GreenHulkBoy.” See Wikipedia.com, String (computer

science), http://en.wikipedia.org/wiki/Character_string_(computer_science) (last visited

Jan. 6, 2005).

380

Wikepedia.com, Deliberate Misspellings, http://en.wikipedia.org/wiki/Deliberate_

misspelling (last visited Dec. 13, 2005); see Ruling on Marvel’s Motion to Dismiss

Counterclaims, supra note 81, at 1.

381

The DMCA expressly does not require monitoring for Safe Harbor. See 17 U.S.C.

§ 512(m) (2000) (providing that “[n]othing in this section shall be construed to condition

the applicability of [the DMCA Safe Harbor] on—(1) a service provider monitoring its

service or affirmatively seeking facts indicating infringing activity, except to the extent

consistent with a standard technical measure complying with the [conditions for

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the same rules that are common in trademark law. For example,

“Toys Are Us” would infringe on “Toys R Us.”

382

Such

misspellings and evasions do not escape trademark enforcement,

383

and should not be facilitated by ISPs where there is an efficient

remedy such as this.

C. Appearance: The Roy G. Biv 7% Solution

Character appearances are not so obviously dissembled, but

they can and should be similarly remedied by an algorithm

nonetheless. In the case of City of Heroes, each aspect of the hero

created comes from a small list of selections. If the sequence of

selections begins to resemble a protected set of characteristics (like

the Incredible Hulk’s giant size, green skin, purple shorts, no other

clothing), the Creation Engine could deny the final choice that

would create an infringing character, while preserving enough

alternatives that the user does not feel frustrated in seeking

legitimate use.

384

This way, infringement has a better chance of

being nipped in the bud without requiring onerous monitoring.

An appropriate measure for this is a 7% solution. A protected

character is submitted to City of Heroes, as created by the holder

eligibility]”). Public policy also frowns on a requirement of monitoring because “privacy

is a social benefit though also a source of social costs.” See In re Aimster Copyright

Litig., 334 F.3d 643, 650 (7th Cir. 2003). In addition, the same forces that make

monitoring direct infringers prohibitive for copyright holders, and thus support the

doctrines of contributory and vicarious liability, see id. at 645, are comparably

burdensome for game-makers like NCsoft and Cryptic if monitoring were

requiredregime, see id. at 648–49, and “could result in the shutting down of the service or

its annexation by the copyright owners . . . because the provider might find it impossible

to estimate its potential damages liability to the copyright holders and would anyway face

the risk of being enjoined,” id. The Sony court was “unwilling to allow copyright holders

to prevent infringement effectuated by means of a new technology at the price of possibly

denying noninfringing consumers the benefit of the technology. Id. at 649 (interpreting

Sony Corp. of Am., Inc. v. Universal City Studios, Inc., 464 U.S. 417 (1984)).

382

Such a solution was mandated in A&M Records, Inc. v. Napster, Inc., 284 F.3d

1091, 1096 (9th Cir. 2002) (stating that “[b]oth parties are required to adopt reasonable

measures to identify variations of the file name, or of the spelling of the titles or artists’

names, of plaintiffs’ identified protected works”).

383

See, e.g., Polaroid Corp. v. Polarad Elecs. Corp., 287 F.2d 492 (2d Cir. 1961).

384

The City of Heroes Creation Engine allows approximately “10

unique character

configurations.” Ruling on Marvel’s Motion to Dismiss Counterclaims, supra note 81,

at 1.

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using the Creation Engine. Each characteristic’s color value is

given a range of 7% in one direction, 7% in the other. This range

represents a total protected color range of one-seventh, because, at

its most elementary, there are seven colors on the spectrum: Red,

Orange, Yellow, Green, Blue, Indigo, Violet. If the offending final

piece of the puzzle is green skin, the Creation Engine will block

the user from choosing any color within 7% of the Incredible Hulk

green submitted by Marvel. For the sake of elegance and the need

to set a limit to this protection, the block would only trigger when

the character being created threatens to be within 7% of the

protected character. Where a Creation Engine facilitates fourteen

characteristics comprising each costume (boot color, tights color,

cape color, etc.), if the first twelve are each within the 7% range of

a protected character, the final two will not be permitted to be

within the 7% range.

Moreover, some characteristics make a greater visual

impression than others, and appropriate weighting should be a part

of the filtering. The color of a bracelet will have less overall

impact in an infringement analysis than will the color of a cape.

Since the surface area of the character is quantified as a part of the

process used in the game,

385

it would not be difficult to establish a

percentage value for costume elements. Like a dress pattern laid

flat, you can measure the percentage of the infringing fabric used

by looking at the pattern.

There are risks to both overenforcement and underenforcement,

but the 7% Solution serves as a principled guideline that can be

implemented through filtering, obviating much of the need for

inefficient monitoring. The 7% Solution will neither confer

immunity nor per se liability, but will allow a court to construct

“adequate filtering” under the DMCA. It can have application in

other video games and perhaps beyond. Where works are created

using digital techniques like these, assigning a percentage value

will not be difficult. The 7% Solution can start as a border, either

side of which exists a rebuttable presumption of infringement or

substantial dissimilarity.

385

See supra Part I.E and accompanying notes.

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D. Powers: Scènes à Faire

Although Marvel would certainly like to protect them, power

combinations should not be protected. The Creation Engine

requires the user to go through four steps to choose powers. The

choices a user makes under Origin (mutant, science, technology,

natural and magic) and Archetype (blaster, controller, defender,

scrapper and tanker) determine the Primary and Secondary powers

available to a new character (e.g., flamethrower, ice bolt, energy

punch, mental blast), with more offered to the user as gameplay

progresses.

386

In their original complaint, Marvel took umbrage at the idea

that a player could create a “science-based” “tanker” hero just like

its Incredible Hulk property.

387

They also complain that their

character Wolverine is cloned when the Creation Engine allows a

user to create a character who (l) is a mutant; (2) is a scrappy

fighter; (3) has three long metal claws; and (4) has fast-acting

regenerative powers.

388

These powers are inherently the scènes à faire in the world of

superheroes, and even exact replication of what makes a protected

superhero “super” should not rise to the level of infringement.

389

Protection here is equivalent to the protection of an idea, which is

forbidden under copyright law.

390

If one company could lay claim

to “flight” or “invulnerability,” it would impede commerce.

391

These are the abstractions that form the language of superheroes,

and ownership of elements of that language would inappropriately

choke off its use.

392

It is common for comparably similar powers

386

See GAME MANUAL, supra note 303 at 5–9, 30–65.

387

Marvel Complaint, supra note 6, at 2.

388

See id. at 7.

389

See Warner Bros. v. Am. Broad. Cos. 720 F.2d 231, 237, 243 (2d Cir. 1983) (noting

that even though “Hinkley’s suit invests him with most of Superman’s powers,” he is “a

different, non-infringing character.”); see also supra Part I.B.

390

See, e.g., Nat’l Comics Publ’ns, Inc. v. Fawcett Publ’ns, Inc., 191 F.2d 594, 600 (2nd

Cir. 1951) (stating that “a copyright never extends to the ‘idea’ of the ‘work,’ but only to

its ‘expression’”).

391

See Gaiman v. McFarlane, 360 F.3d 644, 659 (7th Cir. 2004).

392

The publishers of Superman are “not entitled to a monopoly of the mere character of

a ‘Superman’ who is a blessing to mankind.” See Detective Comics, Inc. v. Bruns

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to appear in characters from different publishers without giving

rise to any claims of infringement.

393

As standard practices of the

genre suggest that actionable infringement does not arise when

powers are duplicated, it is appropriate for courts to apply that

standard to its infringement analysis.

Publ’ns, Inc, 111 F.2d 432, 434 (2d Cir. 1940) (citing Nichols v. Universal Pictures

Corp., 45 F.2d 119 (2d Cir. 1930).

393

In fact, it is somewhat of a tradition for one company to create analogues of another

company’s characters with the same powers but entirely new names and costumes in

order to show a new take on the heroes, or how the companies’ heroes might interact.

Compare, e.g., Gardner Fox, Mike Sekowsky & Bernard Sachs, Starro the Conqueror!,

HE BRAVE AND THE BOLD 28 (DC Comics Feb.–Mar. 1960) (first appearance of the

Justice League of America), reprinted in G

ARDNER FOX, ET AL., JUSTICE LEAGUE OF

AMERICA ARCHIVES: VOLUME ONE (DC Comics 1997) with Roy Thomas, Sal Buscema &

Sam Grainger, When Strikes the Squadron Sinister, THE AVENGERS (VOL. 1) 70 (Marvel

Comics Nov. 1969) (introducing the Squadron Sinister, who later became the Squadron

Supreme, see Roy Thomas, John Buscema & Frank Giacoia, The World is Not For

Burning, T

HE AVENGERS 85, at 8, 11 (Marvel Comics Feb. 1971), Marvel’s authoritarian

take on DC Comics’ Justice League of America); compare, e.g., Warren Ellis, Bryan

Hitch, Paul Neary & Laura Depuy, Pay Allegiance to the Authority, T

HE AUTHORITY

(VOL. 1) 1 (Wildstorm May 1999) (first appearance of anti-hero supergroup The

Authority), reprinted in W

ARREN ELLIS ET AL., THE AUTHORITY VOL. 1: RELENTLESS

(Rachelle Brissenden & Eric DeSantis eds., Wildstorm 2000) with Joe Kelly, et. al.,

What’s So Funny About Truth, Justice & The American Way?, ACTION COMICS 775 (DC

Comics Mar. 2001) (showing how DC Comics’ Superman dealt with analogues of

Wildstorm’s anti-heroes); compare, e.g., Stan Lee, Jack Kirby & Dick Ayers, The

Coming of the Avengers!, T

HE AVENGERS (VOL. 1) 1 (Marvel Comics Sept. 1963) (the

first appearance of The Avengers), reprinted in S

TAN LEE ET AL., MARVEL

MASTERWORKS: THE AVENGERS (VOL. 1) (Marvel Entertainment Group 2002) with Mike

Friedrich, Dick Dillin & Joe Giella, Batman—King of the World, JUSTICE LEAGUE OF

AMERICA (VOL. 1) 87 (DC Comics Feb. 1971) (introducing the Justifiers, an analogue of

Marvel’s Avengers); compare, e.g., Stan Lee, Jack Kirby, George Klein & Christopher

Rule, The Fantastic Four!, F

ANTASTIC FOUR (VOL. 1) 1 (Marvel Comics Nov. 1961) (the

first appearance of the Fantastic Four), reprinted in S

TAN LEE ET AL., FANTASTIC FOUR

OMNIBUS VOLUME ONE (Marvel Comics, 2005) and Finger, supra note 206 (first

appearance of the Batman) with, e.g., Kurt Busiek, Brent Anderson & Steven Buccellato,

In Dreams, K

URT BUSIEK’S ASTRO CITY (VOL. 1) 1 (Image Comics Aug. 1995), reprinted

in KURT BUSIEK ET AL., Life in the Big City, KURT BUSIEK’S ASTRO CITY VOL. 1: LIFE IN

THE

BIG CITY (Homage 1999) and, e.g., Kurt Busiek, Brent Anderson, Will Blyburg &

Alex Sinclair, New Kid in Town, K

URT BUSIEK’S ASTRO CITY (VOL. 2) 4 (Image Comics

Dec. 1996), reprinted in K

URT BUSIEK ET AL., KURT BUSIEK’S ASTRO CITY VOL. 2:

CONFESSION (Homage 1999) (Kurt Busiek’s creator-owned First Family is his

reinterpretation of Marvel’s Fantastic Four, and Confessor is his take on DCs Batman).

A visual illustration of this tradition, including a side-by-side comparison of the above,

can be found at this Note’s companion website at http://brittonpayne.com/Marvel.html

(last visited Apr. 11, 2006).

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Where the only similarity between two superheroes consists of

a duplication of abstract powers, infringement should not be found.

It is fair to introduce a matched set of powers as evidence of intent

to infringe, but such evidence should not stand as infringement on

its own. There is no need to filter the selection of powers for

infringement.

E. Cost will Keep Marvel from Protecting More than its Biggest

Characters

In order to gain the protection of the proposed 7% Solution and

string filtering, Marvel will have to effectively register their

individual properties with City of Heroes. The registration would

consist of a code derived from the Creation Engine version of a

Marvel property (a “Character Code”) submitted to City of Heroes

for filtering. Since City of Heroes will simply add the code to its

7% list in whatever reasonable form it dictates, their labor

commitment will be negligible after startup, and should be seen as

a cost of doing business in the intellectual property world. On the

other hand, Marvel will create these Character Codes at its own

expense. Due to the level of complexity of the Creation Engine,

each Character Code may take a half-hour or more for a user to

create,

394

with the expected vetting from legal and corporate

supervisors. This cost will deter overreaching practices by Marvel

and serve as a disincentive for Marvel to frivolously protect every

character in its stable of thousands. They will only register the

characters that are worth protecting based on their business

decisions. Even if they should decide to protect every one of their

characters, City of Heroes players will still have plenty of choices,

comparing the blocked thousands to the remaining trillions

available. The Character Codes will not need to be term-limited,

as the expected periodic changes in the technical specifications of

the game will likely necessitate new submissions of Character

394

See, e.g., Nikki Douglas, City of Heroes Review, GRRLGAMER.COM,

http://www.grrlgamer.com/review.php?g=cityofheroes (last visited Dec. 12, 2005).

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Codes. Each advancement will likely result in Marvel’s

reevaluation of the characters worth protecting.

395

VII.THE SONY STANDARD IS OBSOLETE: THE ENABLING

TECHNOLOGY THEORY OF SECONDARY LIABILITY

A. Squaring Grokster, Sony, and Secondary Liability for

One reading of Grokster suggests that its ruling is an

elucidation of the inducement factor of a contributory infringement

claim, such that absent inducement, contributory infringement can

be found on other grounds, such as substantial participation,

subject to the Sony safe harbor of substantial noninfringing use.

396

If no contributory infringement is found, a plaintiff could move on

to a claim of vicarious liability, again applying the Sony analysis.

This interpretation leads to a complex and overlapping analysis,

and still does not fully address the need to balance fostering

beneficial technology with protecting copyright.

The better reading of Grokster is that it redefines contributory

infringement as requiring intentional inducement.

397

The intent to

help others break the law is sufficient to confer liability.

398

Under

vicarious liability, the defendant does nothing wrong, but due to a

financial relationship to the infringing behavior, a duty to stop the

infringement attaches.

399

The Grokster opinion reserved the

vicarious liability issue theory.

400

However, these two theories of

secondary liability leave a gap where there is neither inducement

395

City of Heroes has offered several updates since its launch. See, e.g., City of Heroes,

News: Feature Updates, Issue 5: Forest of Dread—New Power Sets,

http://www.cityofheroes.com/feature_update7.html (last visited Dec. 12, 2005).

396

See Metro-Goldwyn-Mayer Studios Inc. v. Grokster, Ltd., 125 S. Ct. 2764, 2777–79,

2781 n.12 (2005).

397

See id. at 2776 (citing Gershwin Publ’g Corp. v. Columbia Artists Mgmt., Inc., 443

F.2d 1159, 1162 (2d Cir. 1971)).

398

See id. at 2779.

399

See id. at 2776 (citing Shapiro, Bernstein & Co. v. H.L. Green Co., 316 F.2d 304,

307 (2d Cir. 1963)).

400

Id. at 2776 n.9.

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nor financial relationship, but a technology has the potential to

destroy an intellectual property industry,

401

or where a nascent

technology is threatened by a powerful copyright interest.

402

Rather than try and squeeze this analysis into what may be left of

contributory infringement absent inducement, that gap could be

more sensibly filled by a third form of secondary liability analysis,

touched on by the Sony and Grokster decisions,

403

which this Note

will call the “enabling technology theory of secondary liability.”

Liability can be fairly conferred where distributors of technology

are reckless as to the infringement they enable. The existence of

such recklessness can be determined with the BIFF balancing test

suggested below.

404

In a digital copying case like Marvel v. NCsoft, a plaintiff first

looks for direct infringement. If there is no direct infringement,

the plaintiff would seek liability under secondary liability theories.

The second step is thus a look at the intent-based claim of

contributory infringement.

405

Grokster should be read to limit

findings of contributory liability to cases where there is sufficient

inducement.

406

The Sony substantial noninfringing use standard

should not be a factor in contributory liability analysis,

407

nor

should a plaintiff be obliged to prove knowledge of primary

infringement, as the bad intent evidenced by inducement is

sufficient culpability for a finding of liability.

The third step would be a look to enabling technology liability.

If the secondary liability claim is predicated on the use of enabling

technology, such as file-sharing software or a MMORPG, the

technology provider may find liability or safe harbor in the BIFF

factors. The factors should be balanced to determine whether there

is a nascent technology deserving of protection, or a recklessness

401

See, e.g., A&M Records, Inc. v. Napster, Inc,. 239 F.3d 1004, 1017 (9th Cir. 2001).

402

See Grokster, 125 S. Ct. at 2775.

403

See id. at 2782 (noting that Grokster “addresses a different basis of liability” than

Sony).

404

See infra Part VII.C.

405

See Grokster, 125 S. Ct. at 2776 (citing Gershwin Publ’g Corp. v. Columbia Artists

Mgmt., Inc., 443 F.2d 1159, 1162 (2d Cir. 1971) (noting that “[o]ne infringes

contributorily by intentionally inducing or encouraging direct infringement”)).

406

See id. at 2780–81.

407

See id. at 2777–79.

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toward the abuse of copyright that calls for liability. This

balancing test will incorporate the Sony standard in its factors that

determine the respective values of the technology and the

infringement.

Finally, the plaintiff looks at vicarious liability claims for

infringement that do not implicate the use of enabling technology,

such as management of a flea market.

408

Where there is (1) direct

infringement by a primary party and (2) direct financial benefit to

the defendant, as in Marvel v. NCsoft, vicarious liability is found if

there is also (3) the right and ability to supervise the primary

infringer on the part of the defendant.

409

The interplay here of direct infringement, contributory

infringement, enabling technology liability and vicarious liability

as the four degrees of copyright infringement is much easier to

follow. Once a liability theory has been established, courts could

look to the DMCA safe harbor provisions. If the defendant does

not qualify for a safe harbor, the courts will have latitude under the

DMCA to fashion an injunctive filtering solution, as articulated

above.

B. Presumption of Liability for Intellectual Property Transfer

Enablers

Where a company relies on the creation or consumption of

intellectual property, there should be a rebuttable presumption that

infringement is implicated and the company is obliged to take

reasonable measures to curb infringement of its users. The

“monitor or control” language of the DMCA should be read more

temporally broadly than it was in the Ninth Circuit opinion in

Grokster.

410

A modern reading of Sony in light of the DMCA

seems to suggest that if there is sufficient non-infringing use, then

there is no need to go into the DMCA analysis to see if there

should be a safe harbor.

411

This hurdle is too low for enablers.

412

408

See, e.g., Fonovisa, Inc. v. Cherry Auction, Inc., 76 F.3d 259, 260 (9th Cir. 1996).

409

See id. at 262.

410

See Metro-Goldwyn-Mayer Studios, Inc. v. Grokster Ltd., 380 F.3d 1154, 1165

Cir. 2004).

411

See Sony Corp. of Am. v. Universal City Studios, Inc., 104 S. Ct. 774, 789 (1984);