Virtual Worlds Meet Real World Litigation

Originally Published 2009

By Gary L. Cole AIA, Esq.

A December 11, 2008 post on Sean F. Kane’s Virtual Judgment, “Does Worlds.com Hold the Patent for the Virtual World?” discussed Worlds.com’s recent teaming with General Patent Corporation (GPC) to enforce patents Worlds.com holds relating to virtual world intellectual property. This was also covered by Mike Sellers’ December 12, 2008 post on Terra Nova, “Worlds.com Asserting Patents on Virtual Worlds.” From Virtual Judgment:

“According to statements by Alexander Poltorak, General Patent Corporation’s Chairman and CEO, “[t]he Worlds patents represent exceptionally valuable intellectual property,” and “[w]e welcome licensing inquiries from the on-line game industry. Non-exclusive licenses are available on favorable . . . and non-discriminatory terms.” “Worlds.com holds U.S. Patent Nos. 6,219,045 entitled “Scalable Virtual World Chat Client-Server System” and 7,181,690 titled “System and Method for Enabling Users to Interact in a Virtual Space”. Thom Kidrin, the CEO of Worlds.com, stated that “[w]e are pleased to have the expertise and IP experience of General Patent and Lerner David to enforce Worlds’ patent portfolio,” and that “[a]s the number of virtual worlds and MMORG’s continues to grow, Worlds has seen the space we pioneered in 1995 validated in techniques and methodologies we believe are defined in our patents.”Second Life?NCSoft for patent infringement. From a December 31, 2008 press release on GPC’s website:

As noted on Virtual Judgment, this might apply to – a lot of virtual worlds. The stakes and implications are enormous and I’d imagine this announcement had a few dozen MMORPG developers scrambling for their IP attorneys. How will this affect online gaming as well as virtual interactive worlds like

Law/Ark has no comment as to the enforceability of Worlds.com’s patents or its likelihood of prevailing in such litigation, but if successful would virtual world developers be required to license the underlying intellectual property from Worlds.com? Would this cause license costs to be passed on to the end users? Would this have a chilling effect on the development of virtual worlds, or, would it encourage developers to create similar intellectual property, knowing that enforcement of their patents had strong precedent?

Since Virtual Judgment’s posting, Worlds.com has, in fact, sued

“SUFFERN, N.Y., December 31, 2008 — General Patent Corporation (GPC), a leading patent licensing and enforcement firm, announced today that it filed a patent infringement lawsuit against NCSoft Corp. of Austin, TX on behalf of its client, Worlds.com, Inc. (Worlds).” “The lawsuit (Case 6:08-cv-00508) was filed in the United States District Court for the Eastern District of Texas, Tyler Division.” “Worlds.com, Inc. (OTC BB: WDDD), of Brookline, MA, owns US Patent No.7,181,690 titled “System and Method for Enabling Users to Interact in a Virtual Space” (the ‘690 Patent). The Patent relates to computer architecture for a three-dimensional graphical multi-user interactive virtual world system. Such systems are utilized in Massive Multi-Player Online Games (MMORPG) of the type known as Graphical Multi-Dimension (GMUD) games, which provide a graphical representation of the player’s character (avatar) wherein movement of the character in virtual space alters what the character views.” “Worlds.com has been a pioneer in the field of Virtual Worlds since the early nineties,” stated Thom Kidrin, Worlds’ CEO. “We are pleased to see that the technology we developed is now widely used by MMO game developers. At the same time, we deserve a fair compensation for the use of our patented technology.”

Whatever the outcome of this litigation, the creation of virtual worlds represents an enormous growth industry which will no doubt spawn more real world high-stakes litigation.

Or, perhaps in keeping with the subject matter of the litigation, virtual world technology has finally matured enough for the legal profession to embrace dispute resolution in 21st century style – a virtual Kumite, à la Jean-Claude Van Damme in Bloodsport. The plaintiff’s and defendant’s ferocious avatars could meet in a cyber-sandy, sweat and blood-soaked virtual pit of deadly dispute resolution (after first clicking “I Accept” to the cyber forum’s “Rules of Engagement”), and may the last man – er, person, mutant, whatever – standing be declared the victor. Architects and game developers would be needed to create convincing 3D cyber courts. The virtual world doesn’t care about your age, sex, species or agility – all you need is quick eye-hand/keyboard/controller skills and the dispute is swiftly resolved and dismissed – with extreme prejudice. This might also give rise to a whole new type of ADR, when mediation and arbitration just won’t do.

Of course, now that I think about it, that sort of defeats the need for lawyers – so never mind.

© Copyright Gary L. Cole 2009