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Ninth Circuit decision in MDY v. Blizzard

Case and Court:

MDY Indus. LLC v. Blizzard Entm’t, Inc., Nos. 09-15932, 09-16044 (9th Cir. Dec. 14, 2010).

Today the Ninth Circuit gave a mixed result to both parties. We have previously discussed this case as part of the three copy ownership cases before the Ninth Circuit.

Overview:

  • MDY is not liable for secondary copyright infringement because Blizzard’s “no-bots” provision was merely a contractual “covenant” and not a condition whose violation would amount to copyright infringement. To be such a condition it must be a “restriction[] that [is] grounded in [a copyright holder's] exclusive rights of copyright.”
  • Following Vernor, users of World of Warcraft are not owners of their copies of the software (madness!) and therefore are not entitled to a Section 117 defense.
  • The Ninth Circuit really, really, really hates the Federal Circuit’s Chamberlain decision and explicitly rejects the idea that there should be a nexus with infringement before a violation is found of the anti-circumvention provision regarding access controls in 1201(a)(1).
  • A tortious interference with contract claim under Arizona law is not preempted by the Copyright Act.

Upshot:

  • The court is grasping towards the right sort of resolution to the condition/covenant distinction, but doesn’t really give us enough to sort out tough cases.
  • The holding on copy ownership turns out to be entirely unnecessary since the secondary copyright liability was resolved based on the condition/covenant distinction instead.
  • Your garage door openers may start coming with lengthy EULAs in the Ninth Circuit and it just might end up being a DMCA violation to buy a replacement opener made by a third party. (More madness.) Some of the sanity that Chamberlain brought to DMCA jurisprudence slipped away today.

See also:

Categories: Contract, Copyright, Copyright Limitations and Exceptions, DRM and Anti-Circumvention, Online Gaming.

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