Article

Should We Be Able To Modify Nintendos? A Note On Nintendo v PC Box

Justin Koo LLB, LLM

PhD student, Dickson Poon School of Law, King’s College London

 

For the avid gamers out there, you would no doubt be aware that playing video games can be quite an expensive hobby. On average one video game costs about £30-£45,[1] whereas, the cost of buying a mod chip to ‘modify’ your console is about £70-£100.[2] Therefore, one can see the obvious allure in purchasing a mod chip as it provides a cheap albeit illegal alternative to buying new games. However, the legality of mod chips for video game consoles has always been in question because its usage normally implies the playing of unauthorised or illegitimate copies of video games.[3]

Without a mod chip these illegitimate copies of games will not work given that video game hardware and software are both encoded with technological protection measures (TPM) in order to prevent such acts. Regardless of this major purpose, there are other ways in which mod chips can be used. Mod chips also allow the use of ‘homebrew’ software, which in lay-man terms, allows users to run applications and processes that ordinarily are not available on a non-modified console. For example, homebrew software would allow: emulator programs to run – these enable the playing of video games from other platforms (normally older discontinued consoles),[4] playing licensed video games from other regions and playing other non-video game media such as DVDs and MP3s (where previously unavailable).[5]

These very mod chips are the subject of dispute in the Nintendo v PC Box[6] case that has been referred by the Tribunale di Milano to the Court of Justice of the European Union (CJEU). In short, Nintendo argued that PC Box’s mod chips circumvent the TPMs designed to prevent the playing of unauthorised video games on their Wii and DS consoles. However, PC Box argues that the true purpose of Nintendo’s TPMs is to prevent the use of independent software and to geographically segment markets by restricting the use of games according to region. Therefore, the Italian district court referred two questions to the CJEU concerning the circumvention of Nintendo’s TPMs on their Wii and DS video game consoles by PC Box’s mod chips:

1)    The first question concerns the application of Article 6(1) of the Information Society Directive 2001[7] to the TPMs contained in Nintendo’s hardware and software. Basically, the first part of the question asks whether Article 6(1) is applicable to Nintendo’s consoles (hardware) that have TPMs although they are not copyright works but merely facilitate the use of them. Secondly, it asks whether Article 6(1) still applies even though the purpose of Nintendo’s TPMs is not only to restrict the infringement of their copyright works (namely reproduction of their video games) but also to preclude interoperability.

2)    The second question focuses on the application of Article 6(2) to the supply of PC Box’s mod chips. The district court asks the question of how the purpose of a device (mod chip) is to be decided in determining whether there are any other commercially significant uses.

In a more general sense there are two major issues that can be inferred from the above questions. In the first place, the validity of video game mod chips is in the spotlight as it is being questioned whether they have any other commercially legitimate purposes that do not involve the infringement of copyright works. And secondly, to what extent will Article 6(1) protect TPMs that go further than merely preventing the infringement of copyright works especially in instances that involve the prevention of acts that do not require the authorisation of the copyright owner.

 

The Opinion

Advocate General Sharpston in her opinion suggested that the CJEU should answer the first part of the first question in the affirmative. Article 6(1) should be applicable to Nintendo’s hardware on the grounds that Article 6(3) details a wide range of access controls or protection processes including copy control mechanisms. If TPMs not contained in the copyright material itself were exempted from protection, then a broad range of TPMs would be excluded contrary to the objective of the provision. However, the TPM used must be proportional. It will be a matter for the domestic court to determine whether the acts requiring authorisation can be restricted without also restricting acts that do not require authorisation based on the current state of technology. What this means is that TPMs that are disproportionate to the purpose of preventing copyright infringement will not be protected under Article 6(1) as it will not be an ‘effective technological measure’.

Regarding the second question, AG Sharpston suggested that the relevant criteria for determining whether Nintendo should gain protection against the supply of PC Box’s mod chips was Article 6(2)(b). In other words, if the mod chips have no other commercially significant purpose than infringing copyright in video games then its supply will be subject to legal repercussions. However, in reaching this conclusion she did note that if the mod chip can be used for legitimate purposes, then it should influence the decision regarding whether Nintendo’s TPMs are proportional. As such if the mod chips can be used for commercially significant legitimate means, then there is the possibility that Nintendo’s TPMs are overly (and unnecessarily) broad and as such may not qualify as ‘effective’.[8] The consequence of this is that Nintendo’s TPMs may fall outside the scope of protection provided by Article 6(1).

Considering all the evidence at hand and the opinion of AG Sharpston it would seem that the decision of the case turns on the finding of any other commercially significant purposes for the mod chip. However, it is this writer’s opinion that even in the instance of other legitimate uses being found, the primary purpose of the mod chip to facilitate the playing of unauthorised or illegitimate video games outweighs any other use. Therefore, Nintendo should receive protection for its TPMs as well as protection against the supply of PC Box’s mod chips.

 

Interesting Issues

Although the Nintendo v PC Box case is interesting in its own right, it does raise some further issues and questions which are as interesting as the case itself. One of the first issues discussed in the case at the domestic level concerned what the applicable law should be, that is the Computer Programs Directive 2009[9] or the Information Society Directive 2001. The decision to choose the Information Society Directive as the applicable law is a significant one because it meant categorising video games as more than software. In fact, the court held that video games cannot simply be regarded as computer programs but instead are “complex multimedia works.”[10] The implication of this is that video games are afforded a broader range of protection than it would be entitled to if were categorised as a mere computer program.

A second interesting point to note is the manner in which the referring court addressed the second question in Nintendo v PC Box. In applying Article 6(2) the court was only concerned with subsection (b), ignoring subsections (a) and (c). It would be desirable to apply Article 6(2) in a cumulative manner for the purpose of determining whether the supply of a device should be protected against opposed to singling out an individual criterion.[11] The consequence of this is that the Italian district court could have avoided the hard question of determining whether PC Box’s mod chips had any other commercially significant purposes by merely looking at the reason the device was designed and its marketing. The rationale behind this criticism is that the marketing and design of PC Box’s mod chips would give insight into the primary purpose of the mod chips as well as any other commercially significant purposes. Thus, answering the question posed by the district court anyway.

But more generally, this case raises the issue of whether TPMs belong in copyright law. Although there is virtue in protecting TPMs given that they serve the purpose of preventing copyright infringements, the reality is that there is nothing inherently copyright-esque about TPMs or anti-circumvention protection. It can be argued that Article 6(1) is a black sheep in the copyright flock.

 

 

 


[1] Price range as found on www.game.co.uk.

[2] This price range is based on my own research of websites selling such devices.

[3] The illegitimate copies of video games are normally downloaded from torrent sites and then copied to DVDs or mass storage devices such as external hard drives.

[4] Note this would most likely also involve copyright infringement – reproduction of video games

[5] See http://www.consoleunlock.com/?hop=mattmartin for the ways in which a mod chip can be used on a Nintendo Wii.

[6] Case C-355/12

[7] Directive 2001/29

[8] Of course the opposite applies, in that, if the mod chip has no other commercially legitimate purpose(s) then the TPM used by Nintendo will likely be proportional and subject to protection under Article 6(1).

[9] Directive 2009/24

[10] Case C-355/12 para 25

[11] Article 6(1) (a), (b) and (c) should be considered together.

Case comment

Case Comment: C-523/11 and C-585/11 Prinz and Seeberger – AG Sharpston strikes again

 

Re-posted from the Eutopia Law Blog

 

Adrienne Yong

PhD Candidate at King’s College London

 

Yet another chapter of the European citizenship saga sought clarification by AG Sharpston in the Prinz and Seeberger Opinion delivered last week on February 21, 2013. Concerning one of the most prevalent categories of citizens claiming rights under the Art 20 and 21 TFEU – students – Prinz and Seeberger discusses a classic situation that has pervaded the over 20 years of Union citizenship development. Effectively, AG Sharpston aims to explicate the notion of proportionality in citizenship, which has for years escaped valid clarification. She discusses the different strands of objectives of integration, with more substantial meaning than it would appear at first.

 

Facts

In Prinz, a German moved from Germany to Tunisia with her family for her father’s job, then returned years later for secondary school, subsequently deciding to attend university in Holland. She was granted funding from German authorities for her first year, but was rejected for the second as she failed to satisfy the ‘three-year rule’ residency requirement, which stated that a citizen had to be resident in Germany for three years prior to the start of their course.

In Seeberger, a German who attended school in Germany, then moved to Spain with his family for his father’s work in the middle of secondary school, completed his secondary education in Spain and after some time qualifying to university in Spain, sought a grant to fund his studies in Spain from the German authorities. This was denied again on the ‘three-year rule’.

Both argued that Art 20 and 21 TFEU were contravened for impeding free movement, and the Court of Justice of the European Union (CJEU) was asked to clarify whether this ‘three-year rule’ was contrary to EU law.

 

AG Opinion

In her Opinion, AG Sharpston sought to explicate her perspectives on the meaning and justification behind integration and proportionality, particularly referring to the justification behind residency requirements often being the protection of national resources. It is questioned by AG Sharpston whether the consistent invocation of the unreasonable burden reasoning requires reconsideration. Beginning by eliminating the provisions inapplicable in order to conclusively consider the effect of suitable criteria, she then delivers her insightful comments regarding justifications, proportionality and interpretation of the ‘three-year rule’.

Evidently, the three-year rule is a restriction. Germany thus submits two justification objectives, one under the economic rationale, the other socially related. She separates the two and considers the legitimacy and appropriateness of both restrictions in a detailed analysis of each objective’s interpretation.

It is evident that AG Sharpston is unconvinced that Member States should simply lay out economic objectives based on avoiding unreasonable burdens on the financial resources of Member States. This was discussed in Bidar and Morgan and Bucher. She believes it is apt for the CJEU to perhaps guide Member States as to what may constitute reasonable or unreasonable burdens, as this highly variable concept is subject to an element of potential exploitation on the part of the protectionist Member States. Suggested is a thorough analysis of whether the burden truly risks interfering with the balance of Member State resources to avoid invoking protectionism behind a veil of valid justification. She then continues to distinguish an economic objective from an integration objective, which brings into play the political elements of a proportionality assessment.

The interplay between integration and economics as objectives of justifications becomes a sticky situation, but ultimately AG Sharpston aims to clarify whether it suffices to consider integration an objective on its own. There is an inconsistency if integration objectives are cited to justify rendering an economic objective proportionate. This is because choosing to require a degree of integration simply to meet budgetary concerns actually ignores the notion of being integrated.

She goes onto state the ‘three-year rule’ is far too restrictive given it requires uninterrupted periods of residence immediately prior to education, and whilst there is no direct mention of nationality, the inherent connection a national has renders it a difficult factor to ignore when considering proportionality. This is particularly relevant here, as both claimants are German. She opines there are certainly less restrictive measures possible, though interestingly does not suggest any outwardly. Though the ‘three-year rule’ is transparent, efficient and legally certain – the rationales behind Germany’s choice of restriction – this does not translate to it being necessarily proportionate.

Under the social objective put forward by the Germans, solidarity is a feature. Ultimately, AG Sharpston considers that the ‘three-year rule’ has little to achieve by means of social objectives given that the link between requiring citizens to reside three years prior to education and them remaining after their studies is tenuous at best. Again legal certainty, transparency and efficiency did not outweigh proportionality.

AG Sharpston answers the CJEU’s question in the positive: Art 20 and 21 TFEU would preclude the ‘three-year rule’ from preventing the claimants from being granted the funding needed for education outside their own home States. Whilst a simple question in effect, AG Sharpston has managed to delve deeper into the meaning and notion of proportionality in terms of what Member States use as justifications, deconstructing their generic excuses of integrationist and economic objectives to uncover what their argument really insinuates and striking them down by use of the famous tool, proportionality.