Copyright Protection for User Generated Content in Virtual World Confirmed

by Pillsbury’s Social Media & Games Law Blog
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While a legal battle will continue between a Second Life content "consultant" and a school teacher using the online virtual-world creating program as an educational tool, the Southern District of New York made one thing clear last week - user-generated Second Life content is copyrightable.

In FireSabre Consulting LLC v. Sheehy, the Defendant, a teacher in the Rampao Central School District in rural New York, created "Rampao Islands," a school project in the virtual world Second Life in 2006. That year, she attended a Second Life convention in San Francisco to solicit help for the project. She met Frederick Fuchs, owner of Plaintiff FireSabre, an education-focused virtual-world content creation company. Fuchs agreed to help with the project in 2006 and designed "terraforming" content, in which he created a portion of the geography of the "First Three Islands" (islands are pieces of land that one can purchase in Second Life) that made up the class project. He provided further terraforming services in 2007 for the "Second Three Islands," for which he was paid $5000. The parties dispute the purpose of the payment - the Plaintiff claims it was a limited license to use the content for that school year and Defendants claim it was either a purchase of the content or a perpetual license to use the content. Defendants have also raised the work for hire doctrine as an affirmative defense, but did not move for summary judgment on that issue.

In any event, the relationship between the parties broke down. In summer 2008, Fuchs deposited 40 screenshots of his work with the US Copyright Office and obtained a Certificate of Registration. He then informed Defendants that continued use of his content was a copyright violation. When they refused to remove the content from the in-game Rampao Islands, Fuchs engaged in "self-help" and removed some content himself. He also sent takedown notices under the DMCA to Linden Lab, the Second Life creator, and succeeded in having additional content removed.

Nonetheless, FireSabre sued Ms. Sheehy and other school district executives, claiming copyright infringement and breach of contract. Both sides moved for summary judgment - motions that the court rejected.

Plaintiff argued that the terraforming was not copyrightable. The court disagreed, finding it was "fixed in a tangible medium" because it existed on Linden's servers and was visible in the game for some period of time. The court also found that it was not transitory, despite the fact that students could alter the content. "In this regard I see no distinction between the terraforming designs and a drawing created on a chalkboard or a sculpture created out of moldable clay. That someone else could come along and, with or without permission, alter the original piece of art does not mean the art was too transitory to be copyrighted in the first place."

Nonetheless, the court denied Plaintiff's motion for summary judgment because there were questions of fact regarding what, if anything, was copied and whether the copying exceeded the scope of any license. The court also rejected Defendants' fair use argument, despite the fact that the works were used as part of an educational project. "Nevertheless, this case does not resemble that of a teacher using an excerpt of a copyrighted work as part of a limited instructional exercise. Rather, as to the Second Three Islands, the allegations more closely resemble misappropriation or conversion." In fact, the court found that none of the fair use factors favored Defendants.

Thus, the case will continue.  And larger issues can be foreseen. Content can be sold in-game and, as this case demonstrates, can be transferred outside of the game. If an outside sale is governed by the agreement between the parties, what is the scope of rights granted for an in-game sale? Does the first sale doctrine apply?  What can a content generator prevent others from doing? Can a user alter the creation of another in a way that is sufficiently transformative to allow for unfettered use? How can one enforce their rights in a game world encompassing millions of users and countless creations?

It's a whole new (virtual) world for copyright law.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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