3D Printing: Some Initial Legal Issues

As a geek, I am very fond of new gadgets.  I love my smartphone (a Galaxy S3) and always try to find new gadgets to improve the movie viewing (and gaming) experience at my house.  There are some interesting toys on the horizon (such as the Oculus Rift and Omni treadmill), but I’d rather briefly discuss 3D printing and its legal implications.

3D printers particularly piqued my interest when I read about them about a year and a half ago.  The technology seems like something out of a sci-fi movie or show.  Basically, a 3D printer adds layers and layers of a material (usually some kind of plastic, though there are people working on making the process work with other materials) until it takes the shape of an object.  At the moment, most 3D printers are used by companies for prototyping or modeling new designs.  There is a growing home 3D printer market (from companies like MakerBot) that aim to have 3D printers in everyone’s home.  The great thing about the devices is that you can print anything as long as you have the appropriate blueprint (usually a CAD file).  

These devices have a number of legal implications, particularly due to patent and copyright law.  Since this is only a blog post (and patent law gets extremely complicated), I’m going to only discuss these issues briefly and in very broad strokes.  Patent law allows for an inventor to have what is referred to as a limited monopoly over an invention described in the patent.  This monopoly is limited in that it only lasts for 20 years, but the inventor has a right to control distribution and reproduction of his or her invention during that period.  In order to gain such a monopoly, the inventor must prove to the US Patent and Trademark Office (USPTO) that they meet a number of requirements (such as the invention being novel).  How do 3D printed objects potentially violate patent law?  Well, patent infringement generally doesn’t require any kind of intent (it’s one reason patent trolls can operate as they do).  If an individual makes an action figure for their kids (or maybe themselves), that action figure could violate any number of patents related to the movement and features of that toy.  That person would technically be liable for infringement, even though they merely drew up the model in a CAD and printed it out without knowing about pre-existing patents. 

Any party seeking to bar the sale of 3D printers would currently have to overcome a couple of major hurdles.  Manufacturers would likely have to pursue lawsuits against the makers of 3D printers, would would require courts to reach some conclusion that companies like MakerBot are liable for contributory infringement.  35 U.S.C. 271(c) includes a rather large exception for contributory infringement.  For there to be contributory infringement in a patent case, the device must not be a “staple article or commodity of commerce suitable for substantial noninfringing use.”  In other words, just because the device is capable of infringing on other people’s patents does not mean that the maker of that device is liable when other people use their device for that purpose.  The device simply has to have a major noninfringing function, which should represent a valid argument for a 3D printer manufacturer (after all, an individual can make any number of non-patented objects).  Another issue is inducement.  This is a separate issue from contributory infringement, but also potentially provides a bridge from individual infringers to the 3D printer manufacturers themselves.  Inducement requires the plaintiff to show that the 3D printer manufacturer go out of their way to infringe on the patent.  Occasionally, this is easy to prove.  There’s a famous case called MGM v. Grokster, where (for example) a company called StreamCast developed a program called OpenNap to allow users to draw from Napster’s network when using their own program (called Morpheus) and advertised the ability to do so in their promotional materials.  Short of a situation like the Grokster case, proving inducement (even circumstantially) is extremely difficult.

The worry is less existing intellectual property law, and more what interested parties will push for once this technology becomes widespread.  There is a fantastic white paper by Public Knowledge on this very topic, which I highly recommend reading.  Expanding aspects of patent law to deal with increased infringement by regular consumers represents the most likely course of action (perhaps by pushing for a broader contributory infringement standard for example).  I doubt that toy manufacturers will attempt to sue individual infringers the way the Recording Industry Association of America (RIAA) did in the late 1990s and early 2000s.  Those law suits were extremely expensive to prosecute and yielded little in return (the judgments were often so high that they became unenforceable).  Expanding liability beyond individuals (to, say, the makers of the devices) can strongly impact other industries and deter technical innovation. 

How this technology, with its legal implications, develops should be extremely interesting.  It would be nice to avoid the legal battles resulting from widespread file sharing, but I am not optimistic on that count.

 

Advertisements

Used Games and the Digital World

As this is my first real post, I figured I’d start out by laying down my ground rules for this blog.  My goal is to update this blog twice a week, on Wednesdays and Fridays.  I may add a Monday post if blogging here becomes more of a habit, and I may add special posts for extremely important legal events (such as if a SOPA-like piece of legislation rears its head again).  With that in mind, let’s get to our first topic: used games.

There have been some interesting rumors over the past month or so about Valve’s intended plans for a Steam game loaning system, as well as a German court case against Valve dealing with resale rights.  This leads me to wonder how a company such as Valve can implement a digital used game (or game lending) system without running afoul of the law.

Now, reselling physical copies of games is a relatively simple matter.  While copyright holders generally control the sale and distribution of their copyrighted materials (under 17 U.S.C. 106(3) as the distribution right), the First Sale Doctrine limits this right in some important respects  Specifically, First Sale Doctrine limits the distribution right to the first sale of the work (from copyright holder to the owner of the physical copy.  After this first sale, the copyright holder no longer holds a legal interest in the distribution of a work.  As a result, people can lend or sell the physical copies of their games as they see fit.  I can sell or lend any of my XBox 360 games as I see fit, so that my friends can see what a great game Red Dead Redemption is.  There have been a couple of Supreme Court cases dealing with First Sale, notably Kirtsaeng v. Wiley, where the Court upheld the applicability of First Sale to objects purchased outside the United States.

However, there are some very important limits to the First Sale Doctrine that apply to a digital game purchased off of a service like Steam.  The first limitation is that the individual must actually own the work (the “ownership” requirement).  This limitation becomes especially limiting with digital copies of games, since (in my experience) most End User Licensing Agreements only grant a license to use the work.  In fact, the Steam Subscriber Agreement specifically says that games purchased through Steam are “licensed, not sold” and that this license “confers no ownership or title” in games purchased from Steam.  The other major limitation is that First Sale only applies to the distribution right, so other forms of copyright infringement (such as making copies of a work without permission) potentially apply.  The right to control when another party may make copies of a copyrighted work poses some interesting questions for digital copies of games, since Steam would need to create new copies to facilitate any used game sales or loans (just as a technical consideration).  As far as I can tell, there isn’t a clear answer to this specific issue. The ReDigi case, dealing with an online reseller of used music files, seems to indicate that the court system doesn’t think that First Sale applies to digital copies.  This case was decided in the US District Court of Manhattan and only applies to ReDigi’s first version specifically.  ReDigi only provides a hint of how courts might view this issue, but other judges and courts may disagree.

Regardless, the limited nature of the First Sale Doctrine seems to present some rather substantial obstacles to selling and lending digital copies of games the way you or I could currently sell or lend a physical disc.  The ownership issue alone might sway a judge to hold that the copyright holder still has a legal interest in the sale and distribution of their digital work even after a sale.  Until we see a court case dealing with this issue, the matter from a consumer rights perspective will remain unresolved.

The Steam Subscriber Agreement actually has some interesting little tidbits for some of Valve’s future plans, showing how they might bypass some of these legal concerns through the power of proper contracting (every attorney knows the true power contracts hold).  Their section on Billing, Payment, and Other Subscriptions includes an entire section (section D if you are curious).  Their method involves transferring a subscription from one user to another using a preset marketplace (such as the Steam Community Marketplace, where hat subscriptions fly back and forth).  Valve, in this case, claims to act as an agent of the content owner (and again states that the user has no ownership right) and charges fees for the service (Gamestop can’t charge fees, though they have other ways to make money off used game sales).  None of this is a substitute for the First Sale Doctrine, since Valve limits the sales to one particular marketplace (that they control) and maintain the right to charge fees for the sale.  Furthermore, I couldn’t loan out a game that I find particularly engrossing to friends to let them see if they like it under the current Subscriber Agreement.  I may really enjoy that Kerbal Space Program game (and it really is a lot of fun…just for the record) but there’s no real mechanism at the moment for me to lend my Steam copy to a friend who’d be interested in giving the game a try.

I’m interested to see how these issues get resolved.  I’d expect there to be a lot of push-back from various parts of the entertainment industry, since those guys have never been particular fans of the various used content market (as the Software and Information Industry Association’s amicus brief in Kirtsaeng indicates).  The answer, ultimately, lies with the courts.

Feel free to leave any questions, comments, or corrections.

   

Welcome

Welcome to my little corner of the Internet.  My name is Dan Nicotera and I’m the in house counsel at a telecommunications engineering firm in Frederick, Maryland.  This blog, however, is not about the kind of work I do during my day job (at least…not directly). 

What I do hope to address in this blog is how Internet, gaming, and other technologies interact with the law.  Sometimes it’s messy, sometimes it’s controversial, but it’s always interesting.  Let’s get started.