Atari Gets The Settlement It Was Surely Fishing For Over An Homage To 'Breakout' In KitKat Commercial
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As readers of this site will know, once-venerated gaming giant Atari long ago reduced itself to an intellectual property troll mostly seeking to siphon money away from companies that actually produce things. The fall of one of gamings historical players is both disappointing and sad, given just how much love and nostalgia there is for its classic games. It was just that nostalgia that likely led Nestle to craft an advertisement in Europe encouraging buyers of candy to "breakout" KitKats and included imagery of the candy replacing a simulation of a game of Breakout. For this, Atari sued over both trademark and copyright infringement, stating for the latter claim that the video reproduction of a mock-game that kind of looks like Breakout constituted copyright infringement.As we discussed in that original post, both claims are patently absurd. Nestle and Atari are not competitors and anyone with a working frontal lobe will understand that the ad was a mere homage to a classic game made decades ago. If the products aren't competing, and if there is no real potential for public confusion, there is not trademark infringement. As for the copyright claim, the expression in the homage was markedly different from Atari's original game, and there's that little fact that Nestle didn't actually make a game to begin with. They mocked up a video. Nothing in there is copyright infringement.It was enough that I'm certain some of our readers wondered why Atari would do something like this to begin with. The answer is the recent news that a settlement has been reached in the lawsuit, and it was almost certainly that settlement that Atari was fishing for all along.Vintage gaming company Atari has settled a lawsuit accusing Swiss foods giant Nestle of using one of its classic video games to sell Kit Kat bars to nostalgic gamers without permission. On Wednesday, U.S. District Judge Yvonne Gonzalez Rogers approved Atari’s request to voluntarily dismiss the case with prejudice.Both parties reached a settlement during a conference in Magistrate Judge Sallie Kim’s courtroom on Dec. 12, 2017, according to court records. The terms of the agreement are confidential. So, while we don't know the terms of the settlement, it's incredibly common for megaliths like Nestle to throw settlement money at pests like Atari to make them go away. The settlements are often not anything like the potential rewards for the plaintiff if the case had gone to trial, but that's entirely besides the point. The point is to get the settlement. It's essentially free money, after all, reliably gained by filing lawsuits trolling successful companies with spurious legal claims that at best skirt the line of what intellectual property laws actually say.It's for that reason that trolls like Atari seek treble and punitive damages in these suits, merely as a way to alter the risk calculation for the legal teams of their victims. A company like Nestle, worth hundreds of billions of dollars, has easy math to do when it comes to deciding how to make this all go away. The problem with this is, of course, that not every company has billions of dollars of revenue coming in. It's the smaller companies that are truly victimized by IP trolls that fill their war chests with these kinds of easy settlements.
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posted at: 12:00am on 02-Feb-2018
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California's Net Neutrality Law Takes Another Step Forward
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In the wake of the FCC's repeal of federal net neutrality rules, countless states have rushed to create their own protections. Numerous states from Rhode Island to Washington State are considering new net neutrality legislation, while other states (like Wyoming and New York) are modifying state procurement policies to block net neutrality violating ISPs from securing state contracts. These states are proceeding with these efforts despite an FCC attempt to "pre-empt" (read: ban) states from stepping in and protecting consumers, something directly lobbied for by both Verizon and Comcast.One of two California net neutrality laws, SB-460, passed 21-12 by the state Senate, and will now head to the state Assembly:"Both bills are meant to give California officials rules to force Internet service companies to adhere to the principles of net neutrality to continue doing business within the state. Those principles broadly guarantee the makers of websites and apps equal access to Internet consumers without excess charges or special fees for faster service. The FCC threw out national net neutrality rules enacted in 2015 by the Obama administration, saying they were unnecessary." Like other state efforts, the California bill mirrors the discarded FCC rules by prohibiting ISPs from engaging in paid prioritization and other anti-competitive behaviors while crafting sizable loopholes for the prioritization of medical services and "reasonable network management" practices. ISPs who violate these restrictions would be subject to financial punishment under California's existing consumer protection laws. The California law is a specific challenge to the FCC's attempt to hamstring state efforts to protect consumers, and should result in some interesting legal fireworks this year.Ernesto Falcon at the EFF argues in a blog post that California's legislation is open to ISP legal assault, and the state ignored many of the EFF's recommended improvements that would shielf the proposed law from the FCC's pre-emption efforts. The EFF also notes that what the California law attempts to accomplish could be accomplished by executive order anyway:"If SB 460's approach to directly regulating ISPs is found to be invalid, ultimately all the legislation does is require state agencies to contract with ISPs that follow the 2015 Open Internet Order. While an important provision, it can already be required with a stroke of the pen tomorrow under a Governor's Executive Order much in the same way as Montana and New York. And while the 2015 Open Internet Order was a good start, why not bring to bear all the resources a state has to secure such an important principle for Californians?" Those court battles will join the numerous other lawsuits that have been filed against the FCC by consumer advocacy groups and companies like Mozilla, who argue the FCC ignored objective data and the will of the public in the rush to repeal the rules. California is also participating in a lawsuit against the FCC by 21 state Attorneys General, several of which are also investigating how the FCC turned a blind eye to comment fraud during the net neutrality open comment period by "somebody" trying to downplay massive public opposition to the effort.As these state efforts accelerate, ISPs have begun to whine that it's unfair for them to have to adjust to numerous, discordant, state-level protection efforts, something they probably should have thought about before repealing arguably modest and very popular federal protections.
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