"The rights for Scrabble are complicated: Hasbro owns the rights to Scrabble in North America, and Mattel in the rest of the world. RealNetworks has a digital deal with both companies, but Electronic Arts also has a digital deal with Hasbro....The...split rights issue...is currently what prevents a potential officially-sanctioned Scrabulous from existing as it prohibits global multiplayer gamers."*
"Digital history is strewn with the bodies of companies that thought they were immune to intellectual property (IP) laws. Most recently, Psystar drew Apple Inc.'s fire when it launched a series of Macintosh clones. Though we were surprised at how long it took the Cupertino company to react, everyone knew that Apple would eventually sue and earlier this month it did. Apple even asked Psystar to recall the Mac clones it already sold.
...The 21st century poses greater risks for companies that don't police their IPs than ever before. Copy-cat ideas spread as rapidly as wildfire on a dry Montana plain. Sites like Facebook provide a platform for applications and utilities that might otherwise go unnoticed. The site has millions of users and they're always looking for interesting new applications, which are, thanks to a smartly-designed interface, easy to find.
...Particularly galling to me are the Pollyannas who decry the big corporate giant going after the little, helpless developer guy. Please. I shed no tears for the Indian developers. They knew what they were doing and they obviously understand that small ideas can become very big business online. Hasbro knows this, too. To let Scrabulous continue would be a clear signal to other developers that it's open season on Hasbro's IPs.
Today's technology makes imitation particularly alluring, but it's simply not worth it. In the end, there is no safe harbor for IP pirates—a reality that surely sends a cold shiver down the spine of every developer of every other little copy-cat product and service out there."
"Although Hasbro sent a takedown notice back in January to Rajat and Jayant Agarwall, they later tried to come to an agreement with the brothers over the rights to the game. In fact, Electronic Arts, RealNetworks, Mattel, and Hasbro - the four U.S. companies that each have some of the rights of Scrabble - came together to offer the brothers a large sum of money which would have allowed them to keep a version of the game up and running.
According to this New York Times article, Jayant Agarwalla said that he and his brother did not create Scrabulous to make money - they just wanted to play Scrabble on their computers. So why didn't they accept the big check then? The brothers decided to turn down the check, rumored to be around the $10 million mark; apparently, they were holding out for more money. How much more? A multiple of several times $10 million by some accounts. Even though the game, by all fair estimates, was probably only worth around $3-6 million, the brothers felt they deserved more.
While some are calling the Scrabulous shutdown a great blunder on Hasbro's part, we wonder what other solutions could the company have taken to protect their brand? Or is it time for companies to give up trying to protect their brand altogether and just learn how to better compete with those that counterfeit their copyright? This question is truly the basis for all the arguments surrounding the piracy issue - that is, whether it's worthwhile to go after pirates, thieves, and copyright-infringers, or whether it's better to simply let them be and consider it free advertising."*
SCRABBLE® is a registered trademark. All intellectual property rights in and to the game are owned in the U.S.A and Canada by Hasbro Inc., and throughout the rest of the world by J.W. Spear & Sons Limited of Maidenhead, Berkshire, England, a subsidiary of Mattel Inc. Mattel and Spear are not affiliated with Hasbro.*
"In addition to Scrabulous' own troubles, the situation calls into question a host of potential legal landmines for Facebook, which allows programmers to develop and upload all sorts of applications to the social networking site.
'The big issue here is what this implies for Facebook,' said Tom Hemnes, a Boston-based attorney who specializes in copyright and trademark law. 'If I were betting on this, if the case came to litigation or settlement, [I would bet] that Facebook would lose. They are indirectly associated with the name Scrabble to attract viewers to their site, and that would be trademark infringement.'"*
"Scrabulous infringes on Hasbro's trademark. Like all intellectual property owners, we take this type of infringement seriously," Hasbro spokesman Gary Serba said in a statement. "We are reviewing a number of options with the parties involved and hope to find an amicable solution. If we cannot come to one quickly, we will be forced to close down the site and its associated distribution points."*
"Jayant said that he didn’t exactly understand what all the fuss was about. Its ability to generate insane numbers of pageviews notwithstanding—he said some players play as many as 170 games at a time on Facebook—the application isn’t throwing off that much money. He declined to say exactly how much, pegging revenues at "over $25,000 a month.'" *
"Q: What if the creators of Scrabulous were to change the name to 'XYZ Game' and tweak the board and point system for their application. Would that make it legally permissible?
A: People are always free to create their own original games. But if they copy the creative expression of a third party, or they try to mimic the logos or trademarks for a famous brand, they will typically be enjoined. Intellectual property law protects against copying and unfair competition. But people are always allowed to engage in fair competition which would require them to create their own original game. The law requires a minimal level of 'original and creative expression' to be entitled to copyright protection."
"Hasbro has an obligation to protect its intellectual property and will act appropriately when necessary. We recently filed a lawsuit against the developers of the infringing Scrabulous application, and we are pleased that the unlawful application has been removed from Facebook. We evaluate every situation on a case-by-case basis and have no comment regarding the Scrabulous developers’ new application at this time."
“Q: Many people think that because Scrabble is 70 years old, it should be in the public domain. Why isn't it?
A: A copyright claim lasts for the life of the author, plus 70 years.
Q: Butts passed away in 1993, which would extend the copyright in this case to the year 2063.
A: Yes, but it’s really important to remember that the plaintiff is also asserting a trademark claim, and that lasts as long as you exploit it. Marks like Coca-Cola, Mercedes -- those can continue indefinitely as long as it remains in use. The law prevents third parties from making both literal use of a trademark as well as uses that are confusingly similar. The term ‘Scrabulous’ is obviously intended to evoke the name Scrabble. Plainly, the people who created the game were trying to evoke the Scrabble mark.
Q: What’s the policy argument for having copyrights in the first place?
A: The term of protection is what allows authors, composers and other creators to successfully exploit their works. If material immediately came into the public domain, then there would be no financial incentive to write a song, film a movie or undertake similar creative ventures. The reality is that all of the great authors, composers and artists wouldn’t be able to make a living. The public benefits by encouraging the arts. In return, artists and creators are compensated. If you took that away, you would have a much smaller body of creative works.
Q: So why create an expiration date?
A: It’s a balance that the framers of the Constitution had to make. They wanted to create financial incentives for artists and creators. But they also wanted to foster free speech. The quid pro quo is that after the period expires, a work comes into the public domain.
Q: Why 70 years?
A: That was fixed by an international treaty so that U.S. authors, performers and creators have the same right as people in other countries. The term of protection used to be shorter.
Q: What if the creators of Scrabulous were to change the name to ‘XYZ Game’ and tweak the board and point system for their application. Would that make it legally permissible?
A: People are always free to create their own original games. But if they copy the creative expression of a third party, or they try to mimic the logos or trademarks for a famous brand, they will typically be enjoined. Intellectual property law protects against copying and unfair competition. But people are always allowed to engage in fair competition which would require them to create their own original game. The law requires a minimal level of ‘original and creative expression’ to be entitled to copyright protection.”
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