Can Nintendo's Patents TAKE DOWN Palworld? | A Lawyer Discusses

Richard Hoeg dives into the ongoing legal battle between Nintendo and PocketPair, focusing on the intricacies of patent law and its implications for the gaming industry. Starting with the background on Palworld, he explores Nintendo's legal actions and the broader context of patent strategies. The episode examines social media reactions, the strength of Nintendo's case, and the potential for settlement. Richard describes patent laws between Japan and the US, discusses Nintendo's history with lawfare, and considers the impact on public perception. He analyzes the role of patent trolls, the nemesis system patent, and the balance between lawsuit motivations and innovation, concluding with community engagement.

Episode Transcript

(00:37):
Hello, and welcome to another episode ofvirtual legality.
I'm your host, Richard Hogue, managing memberof the Hogue Law Business Law Firm of
Northville, Michigan.
And today, we're gonna talk about Pal World,the hit video game that does not feature
Pokemon as much as Nintendo might wish it didbecause it would make their lawsuits a little
bit easier.
But for more on that, please stay tuned becausewe're gonna talk about it in just a moment.

(01:01):
Before we do, I do wanna mention that this is achannel and show that is supported by viewers
and listeners like you.
If you like this content, you don't have to payanything.
You can just like, subscribe, give comments, orotherwise tell YouTube that you're enjoying it.
But if you do wanna support the channelspecifically, you can look at Play or Patreon,
both links that are in the description, or giveout memberships, have super chats, whatever

(01:23):
else it is that you like to support it.
Everything helps, and thank you so much inadvance.
Now as promised, we've talked about Pal World alittle bit before in this space.
If you don't remember, when we covered it inpatent world, Nintendo versus Pocket Pair,
which is now part 1 of that series, wementioned that as you can see from the pictures
in these thumbnails or if you've experiencedthe game yourself, a lot of folks thought the

(01:47):
designs of these particular characters, thesepals, were a little bit close to the sun as to
how Pokemon looked, Nintendo's famous Pokemonseries.
And folks thought that they might get sued forcopyright infringement, which is infringement
on essentially the creative or artisticcreations of another.
Instead, what Nintendo has elected to pursue ispatent infringement, or the breach of

(02:12):
inventions that have been made by Nintendo.
And that has become quite a bit of acontroversy because nobody was saying from
pocket pair at paleworld or from Nintendo whatpatents they were even talking about.
At least not until a couple of days ago whenpocket pair released the following statement.
As announced on September 19, 2024, The PokemonCompany, a Nintendo Company Limited,

(02:35):
hereinafter referred to as the plaintiffs, havefiled a patent infringement lawsuit against us.
We have received inquiries from various mediaoutlets regarding the status of the lawsuit,
and we would like to report the details andcurrent status of this case as follows.
Details of the lawsuit.
The plaintiffs claim that Powell World,released by us on January 19, 2024, keep that
in mind, infringes upon the following 3 patentsheld by the plaintiffs, and are seeking an

(02:59):
injunction against the game and compensationfor a portion of the damages incurred between
the date of registration of the patents and thedate of filing of this lawsuit.
Now I've highlighted seeking an injunctionagainst the game here primarily because a lot
of folks have focused just on the damagescomponent, which we will see is not very
convincing for a reason to file this lawsuit.
But they skip the notion of seeking aninjunction, which in legal parlance means

(03:22):
trying to stop Powell World as it exists rightnow from being sold into the marketplace and
probably requiring Power World as it existsright now to be removed in certain ways from
Game Pass or other avenues that you might haveaccess to it.
We don't know the specifics here because thereare different things that you can ask to have
enjoined, But it does seem from the languageseeking an injunction against the game that

(03:46):
part of Nintendo's lawsuit is trying to getpower world removed from the earth as it were,
and that the portion of damages that we'regoing to talk about is maybe not as substantive
a part of this particular lawsuit.
Then pocket pair continues by establishing thatthere are 3 patents that Nintendo has
identified as at issue here.
And the target patents, which we'll call bytheir last 3 digits, 191, 117, and 390, are

(04:11):
issued as of dates that are after the releaseof PowerWorld.
That's one of the things I wanna point out thatPocketPair has really highlighted here and that
a number of people have kind of jumped upon ina way that I don't think is entirely fair to
this conversation.
It's one of the reasons that I wanted to havethis video.
So PocketPair makes note of the fact that thefirst patent was applied for on July 30, 2024,

(04:33):
remembering that their release date is January19, 2024, and was granted on August 27, 2024 by
the Japanese patent authority.
The next patent was applied for February 26,2024 and granted on May 22, 2024, and the third
is applied for on March 5, 2024 and granted onJuly 26, 2024.

(04:55):
And the reason that is important is because anumber of people did kind of seize on the fact
that these were all applied for and issuedafter the date on which Power World was
released, which seems intuitively unfair to alot of folks.
Obviously, you can't infringe a patent thatdidn't exist when you released your product,
and so they have a lot of questions as to howthis even works.
In fact, a number of tweets and social mediaposts that I saw said, hey, this is coming out

(05:20):
after Power World did.
How is any of this even fair?
Which is why I wanted to talk about 3 differentaspects of this particular issue.
Nintendo versus Power World 1, 2, 3.
And we're going to do that as part of thisvideo.
So without further ado, let's look at number 1dates, parentheses, continuations, because we

(05:40):
have to talk about what it means for thesepatents to have been issued after the release
of Power World.
Now before we do, I want to cap some of these,super chats that I'm seeing come in already
because I'm not always the best at giving themnotice when they come in.
I wanna mention just because, thank you forgifting 10 Hoguan memberships.
That is super generous of you.
I really, really appreciate it.

(06:01):
And just because for the comment, too late, I'mthrowing money at you.
I appreciate all of the well wishes justbecause and all of the money that you have
thrown at me.
None of this could happen without folks likeyou, so thank you so much.
And thank you to June B for gifting 5 Hoaglamemberships herself and for having this cute
little cat on her profile picture.
Thank you so much.

(06:21):
I really, really appreciate it.
Now, let me go back to where we were at.
We're going to talk about dates andcontinuations, and I want to make sure I hit
all the right buttons and don't accidentallyevaporate all this prep work I did.
So hang on with me for just a moment and wewill get to the tweet of CSOR.
And this is not designed to call thisparticular person out, so please don't gang up

(06:46):
on them or otherwise seek them out on socialmedia.
This is just an example of some of thematerials I was seeing on social media.
This is why I'm boycotting Nintendo.
These patents were made after Pal Worldreleased, and they're suing for more or less
$65,000.
We'll see in just a minute.
At this point, this is just bullying.
Nintendo, you're just embarrassing yourself.

(07:07):
And we'll see the term bullying again as well,but I wanted to highlight this is what people
have been saying because patents, folks,patents are tough to read and tough to
understand.
So here's the Google patent software, which Idon't really love for how it describes these
things or how it lays them out, But this is agood way to at least pop in and see what we're
talking about.
This is the first patent that is mentioned inthat power world announcement.

(07:29):
And one of the things that people are skippingis that even though they were applied for on
July 30, 2024, in respect of this first patent,you see this reference to priority.
This is a continuation, what's called acontinuation of an existing patent that goes
back to an earlier date.
You can see the dates here in this littlesummary box, 2021, 2022, 2023, and 2024.

(07:52):
But we can also go back and look at if thisworks, which it almost never does exactly what
you think it should do, and see that thepriority applications go back to December 22nd
2021.
And if we look at all the patents here, and Ipromise not to just go through all of them in
super specific detail, we can see that they allgo back to that December 2021 patent

(08:18):
application and grant.
And so when we're talking about this, yes,these particular patents were issued after the
release of Power World and certainly after thetrailers for Power World first came out.
But they all relate back because of the way thelaw works to a period of time before the game
was released, and they all have that priority.
So that is infringing in some important way.
And I think if you're not familiar with patentlaw, if you're not familiar with law in

(08:41):
general, this can sound and in fact, I canagree that it doesn't sound entirely fair.
Right?
You've got patents that are in existence in2021, and then they're kind of changed to some
important respect that Nintendo thinks isimportant enough to make the foundation for
their lawsuit after you've released yourproduct and now you're being sued over it.
That doesn't seem just, But the way thesethings work is that we want inventors to be

(09:05):
able to invent things.
They have to name what those inventions can beused for, but they don't have to be responsible
for everything that they possibly could be usedfor in the world.
We don't want to limit the protections that wegive to those inventors only to what their
imaginations have at the moment in time thatthey make their invention.
And so if you imagine that you build a new kindof way to bend metal and you think of these 10

(09:28):
ways that that could work in industry, butsomebody else comes up with a different way
that you could then apply your patent to thatway after the fact is what we want to give you
the protection for.
Said another way, if we look at what we'retalking about here, we're talking about what
we're calling continuations in the patentworld.
And I thought this was a particularly goodsummary of it.

(09:49):
This is actually an academic article talkingabout continuations and their abuse.
They describe it as follows.
In 2018, just over 15% of all US patentapplications were continuations.
And again, I'm an American lawyer, so we'regonna be talking about US law.
These are patents that were issued and alawsuit that's happening in Japan.
So I cannot speak for Japanese law or patentissuances.

(10:10):
I can't speak for US ones, and I can tell youthat in general, these various jurisdictions,
these countries, these sovereigns have treatiesand agreements to treat intellectual property
protections similarly, but not identically.
So I can talk to you about theories andmotivations behind intellectual property and
patents.
But the substantive law, the way that thesedifferent jurisdictions view the things that

(10:32):
we're gonna talk about, can differ across Japanand the United States.
A continuation application seeks protection fornew claims based on the invention disclosed in
a prior parent application using the parent'spriority date to assess novelty and
obviousness.
In principle, continuations encourage earlydisclosure by granting inventors the option to

(10:54):
draft new claims at a later date when they havea better understanding of the technology and
its commercial embodiments.
In practice, again, this is an article aboutthis potentially being abused, continuations
are controversial because they allow applicantsto tailor their parent claims to cover products
and technologies developed after the originalinvention is disclosed.
Right?
So the process of granting a patent or gettingissued a patent is that you're supposed to

(11:18):
invent something.
You're supposed to have creating something newand novel in the world, and so the governments
of the world give you a monopoly on the controlof that technology, that invention, because we
want inventors to be out there inventing.
But continuations as a concept can helpencourage inventions to be disclosed, but they
can also be used for nefarious purposes whereyou say, I'm gonna ask for this broad

(11:41):
prescription of claims.
And if I can convince a patent body to grant methis patent, then I can Submarine Future
Technologies by saying, oh, yes.
My patent also applies to that thing because Iwrote it so generally that it can apply to that
thing.
And now we have a patent issue.
We have this problem that this article isdesigned to address.
But importantly, from a legal perspective, thepriority date is the earlier date of the parent

(12:05):
application.
So we're gonna talk about what Nintendo hasdone here.
We're gonna talk about these patentsspecifically, but it's important to note from a
date perspective that while they were appliedfor and issued after the release of Power
World, they are still having a time frame ofpriority before Power World was actually sent
to market.
So there's a whole controversy about whether ornot this this Nintendo set of patents should be

(12:30):
allowed.
We'll see some smart patent attorneys at theend of this video talking about aspects of
that.
But I do wanna point out that from a legalperspective, at least as the Japanese patent
court is taking it, this is all above board.
Right?
This doesn't make it right.
This doesn't make it something that you have tobe a fan of, but it does mean that when we're

(12:50):
talking about what Nintendo is doing here, itdoes at least comply on its face with the legal
requirements that are put in front of them.
The use of continuations to draft claimscovering technology that postdates an
invention, a practice we call late claiming, iswidely discussed among patent attorneys and a
frequent topic in policy debates.
In 2007, the US Patent and Trademark Officeproposed new rules that would sharply limit the

(13:11):
use of continuations, but eventually withdrewthe proposed changes after receiving
substantial pushback from who?
Well, from patent owners.
The people with patent portfolios like theircontinuations.
This is a practice that is designed to helpinventors, but can, like all other practices we
talk about in the law, be abused.
Right here in virtually gallery, we've talkedabout the DMCA.

(13:33):
We've talked about takedowns.
We've talked about the ways that intellectualproperty holders, in that case, copyright can
abuse that system to keep people from makingcontent that they don't want to see, even if it
would clearly fall within fair use or otheraspects of copyright exceptions.
This is a similar kind of concept where peoplethat are having a legitimate claim to certain

(13:54):
inventions that they've made, whether it's invideo games or other technologies, can write
them broadly and then narrow them down in a waythat hurts people that are coming up with their
own ideas in a fashion that maybe theyshouldn't be allowed to.
But because as we've talked about here invirtual reality, the legal system is expensive
and costly and time consuming, a big company orat least a company with a litigious history

(14:15):
that knows its way down these back alleys canmake life difficult for a newcomer or a smaller
company like Pocket Pair.
And reasonable minds can differ as to how wefeel about that overall.
But going back to these patents, the otheraspect that I wanted to talk about is that,
one, these patents are actually issued in Japaneven in 2021 a bit after you would think that

(14:39):
they would have been because Arceus is actuallyreleased January 28, 2022.
But these particular patents are issued at theend of 2021 when the issues here, the throwing
of pokeballs and whatnot, were actually madeknown publicly in February of 2021.

(15:00):
So they actually have to file a specificexception under the Japanese Patent Act to say,
okay, we know we disclose this thing publicly,and we know we're not really allowed to file
for patents that we disclose publicly, like aperson running in a field and throwing a
Pokeball, but we get certain exceptions if wetell you where the publications were.
In this case, the trailers for Arceus.

(15:22):
You can see publication date here for Pokemondotco.jpexlegendsarceusjaw.
And these are all videos of trailers of Arceus,and we can ask for that exception and then tell
you that conventionally, there are gameprograms in which a player character throws a
ball at a character in a virtual space,capturing the character and setting it in the

(15:42):
player character's possession.
However, in the game program disclosed in theabove mentioned non patent document 1, the ball
can only be thrown to capture characters duringbattle, and the ball cannot be thrown on the
field.
Therefore, an object of the present inventionis to provide a game program, a game system, a
game device, and a game processing method thatenable a player character to perform various

(16:03):
types of actions on a field in a virtual space.
And a lot of people have come out and said,well, this just sounds like you're throwing a
Pokeball and capturing a Pokemon, but there arelots of games that do that, whether it's Temtem
or Cassette Beasts or other games that you canthink of that allow you to capture monsters and
use them on your team.
Here, Nintendo is saying yes, but that's alwaysdone in battle or it's always done in turn

(16:23):
based format.
Here, we've got a 3 d character in a 3 d spacethrowing a physical object at another physical
object and having the capture happen fromthere, and that's a new invention.
And reasonable minds can differ as to whetherthat's something that should be patent
protected because as we will talk about withwhat patents are, there is a question as to
whether this concept is novel enough, is newenough to allow it to get extra protection from

(16:47):
Japanese or American or any otherjurisdictional authorities.
But this was issued by Japan, and so that's howNintendo is seeking this particular claim, and
we'll get to that in just a minute.
I wanted to cover dates first.
Now let's talk about damages because this wasthe other aspect.
We saw that in the earlier tweet that we justdiscussed that became a major issue of some

(17:12):
controversy, at least some discussion fromfolks that were discussing this particular
issue.
I brought up now a Forbes article from PaulTasse, who we've discussed in this space and in
Hangouts and Headlines before.
He writes a lot about live service games andvideo games in general for Forbes.
Nintendo's power of lawsuit takes an absurdturn, says the headline.
Several weeks ago, it was announced that aftermonths of seemingly building a case, Nintendo

(17:34):
was suing pocket pair makers of Powell Worldfor some sort of unknown patent infringement.
Now we have more details on what exactly isgoing on there.
PocketPair has just announced that Nintendo isdemanding 10,000,000 yen plus late payment
damages from them.
I would not expect anyone to know this mathoffhand, but 10,000,000 yen is about 66,000 US
dollars.
No.
That is not missing any zeros, and, yes, thisis PowWow, the game that sold 25,000,000 units

(17:59):
across PC and Xbox as of June.
In other words, that's pocket change dependingon what the late payment damages may be.
And, again, I'm not a Japanese lawyer, but ingeneral, we talk about late payment damages.
That's an understanding that this should havebeen licensed to not be infringing.
And so you owe for the damages that are setforth in the statute, but also for what amounts
to interest accruing on the payment that shouldhave happened before any of this infringement

(18:21):
occurred, not a substantial amount of money inthe overall scheme of things in general.
Where things get weird, says mister Tassie, iswhat patents were actually violated as they are
ones that most people would have no ideaNintendo even owns, including pocket pair.
Apparently, The first patent, which we justlooked at, is about aiming and firing some sort
of item towards a character, quote, unquote, ina field, it literally specifies that,

(18:44):
triggering a combat state.
The second patent is something about being ableto capture creatures in the wild rather than
just in a battle setting.
The 3rd patent is about riding creatures in anopen world and transitioning between those
creatures.
And as described in an article like this one,it is reasonable for people to think that
Nintendo has monopolized, has a completeconceptual protection on these ideas as

(19:05):
concepts, right?
Firing an item towards a character in a field,capturing creatures in the wild, riding
creatures.
And then you have all sorts of problems withriding horses in video games or capturing
things in various ways in video games.
But that's not what is actually happening inthe patents.
Right.
It's important for folks to note from a legalperspective that patents protect inventions.

(19:25):
They protect application of ideas.
They do not protect the ideas themselves.
So the patent that Nintendo holds is notspecifically for any concept of aiming and
firing an item towards a character in a field.
It's for the specific way in which Nintendoitemizes how their computer understands what
the player is asking of it.

(19:47):
Right?
So if we read this, and we're not gonna go toodeeply into this one because it's translated
from Japanese.
2 because nobody, not even most lawyers, canread patents straight up.
Even patent lawyers, I think, have to take abreath when they look at these things.
The claims are on the computer when a firstcategory group, including a plurality of types
of capture items for capturing a fieldcharacter arranged on a field in a virtual

(20:07):
space, is selected based on an operation inputof pressing an operation button, that can be
the x button to you and I, the player characterin the virtual space is made to take a stance
to release the capture item, and when a secondcategory group, including a plurality of types
of combat characters that engage in combat isselected, the player character in the virtual
space is made to take a stance to release thecombat character, determining a direction of

(20:27):
aim within the virtual space based on adirectional input, further selecting based on
an operational input using an operation buttondifferent from the operation button, probably
could be written a little bit better there, thecapture item included in the 1st category group
when the 1st category group is selected, andthe combat character included in the 2nd
category group when the 2nd category group isselected based on an operation input of
releasing the operation button that has beenpressed when causing the player character to

(20:50):
perform the ready action, etcetera, etcetera,etcetera.
And as you can see, these are very difficult towrite.
They're very difficult to read.
They're very difficult for anybody tounderstand.
But the notion is we're actually gonna describea specific method in which the player's gonna
hit buttons.
The computer's gonna interpret those buttons ina specific way.
They're going to display the thatinterpretation in a specific way, and all of

(21:11):
that together is a new way of thinking aboutthis particular problem.
And you could say, Rick, isn't that just thesaying or isn't that a kind of common evolution
of what we would expect for capturing somethingin turn based would look like in 3 dimensions
as we understand them in 21st century videogames?
And I would say to you, yes, probably.
Probably if I'm the patent officer here, I'mdeclining this as essentially non novel, right?

(21:36):
That this is something that a person ofordinary expertize in the art of crafting video
games would come up with on their own from thetools and inventions that are already in
existence in the industry of making videogames.
But this particular patent office said, great.
It's an invention.
It's novel.
Here it is.
And part of what PocketPair would use to defenditself in this particular instance is you

(21:57):
shouldn't have issued that patent.
Right?
That's one of the defenses is that it isn'tnovel.
It doesn't meet the requirements of a patent.
We'll talk about those requirements in just aminute.
But that's part of what we're talking abouthere.
What we aren't talking about here is theconcept of these things outside of how the
computer interprets them, outside of the buttonpresses, outside of all that technical stuff

(22:18):
that we just mentioned, that is all required.
It's in fact part of the invention that we'retalking about.
And while it all is described by these variousthings and the abstract talks about these
various things, that is too broad of anunderstanding for people to have about what
patents are.
Because, yes, you can absolutely look at thisand say, I've been riding creatures in video
games for a long time.

(22:39):
I can't believe Nintendo has a monopoly onthat, and they don't.
They have a monopoly potentially on the exactway that you hit buttons and pull from menus in
the way it's put forth on their HUD or theiruser interface and how that character
interaction works on your television screen asa result.
But that doesn't mean that these are rightlygranted.

(23:00):
It just means that it's different from whatwe're talking about in this Forbes article.
Granted, Paul Tassi says, patents are prettygranular as we just saw.
So these may get into more detailed specificsthan what we're seeing here, but, yes, it does
fundamentally seem like Nintendo was sayingthey cannot use the open world capture system
or riding creatures in an open world, whichcan't be right.
We're so detailed only PAL World is violatingit and say any game with a horse or chocobo is

(23:23):
not.
PAL World is, of course, not the first game toallow capturing of creatures in the wild
either, though appears to be something aboutthe way this is done.
I'm not sure that I can think of personally anyother examples of throwing something at
something to capture it.
It is a physical interaction point in an openworld type of environment in my history of

(23:43):
video games, but maybe you can in the commentsor you can leave it as a comment to this video,
a way that on its face does not seem toactually match what we see in most Nintendo
games.
As this is a game with live action open worldcombat, where you run around with your own
monsters whacking an enemy and shooting orslashing at them to get their health down low
enough to bonk them with a ball.
So, again, this is the incredibly litigiousNintendo we're talking about here.

(24:07):
So they would likely not be pursuing this ifthey did not believe that they had a strong
case.
So I want to talk about this sentence a littlebit.
I have seen this kind of concept as well incertain cases, which is to say, if I sue a lot,
I must be pursuing it when I have a strongcase.
I actually think that this is probably betterread the opposite way.
If I am litigious, if I'm a company that sues alot to protect my assets, chances are that I

(24:33):
don't need quite as strong a case as somebodythat's disinclined to suing you might in order
to go across that threshold to the lawsuit orthe court system itself.
If I'm incredibly litigious, I think I'm likelyto go after a weaker case because I'm already
inclined to litigate things.
So Nintendo here has some kind of claim thatclearly have patents issued that might apply to

(24:56):
power world in the ways that are suggested.
But while they can be defended against, I thinkthe fact that they are litigious does not
actually help them lead to the understandingthat their case is strong.
With an amount of money that sought is so low,this seems more about sending a message than
actually trying to rake in cash.
I don't think Nintendo is trying to rake incash.
The pocket pair will have to spend lots ofmoney on legal fees and time that could be used

(25:17):
on development fighting this.
They might.
As we talked about in the first video, the veryhigh likelihood of this situation is that this
gets settled.
PowerWorld may have to change in certain smallways in order to avoid infringement of the
patents that Nintendo is claiming, but it isvery unlikely that PowerWorld is gonna go away.
It's very unlikely that PowerWorld orPocketPair is going to risk getting to some

(25:39):
kind of judgment that could result in aninjunction and the killing of their golden
goose.
So because it is so valuable to PocketPair, itis unlikely that they're gonna go that far, and
it's unlikely that Nintendo would push that farbecause of some of the issues that we've
already identified in their patents, theoverall kind of generality of their
application, and the way that the press andpeople are responding to this particular

(26:00):
Nintendo lawsuit.
So in my view, this is very likely to end in asettlement that may or may not be fair to you
as you view this, in the long run, whether youthink Nintendo is bullying them or not.
Certainly, I think that PowWoworld is gettingcaught here a little bit by Nintendo being,
very kind of well lawyered machine.

(26:21):
This this particular issuance of patents andthe way that they have done this to kind of
trap PocketPair and Pal world is not gonna feelright to a lot of folks.
Doesn't necessarily feel right to me, but Idon't think it's nearly as bad as Nintendo just
going after $65,000.
Right?
When we talk about this, the important part isthat they are seeking an injunction.

(26:43):
The important leverage point that they have isthat they are trying to get a court to say
Power World is not allowed to be sold in thefashion that it is sold right now.
And so you have to change it or you have totake it all away because we are otherwise going
to stop you from selling that particularproduct.
Now IGN here put forth their own picture thatsays Nintendo lawsuits against PowWoworld add

(27:04):
up to a merely $65,000, but their tweet is alittle bit more specific on this point.
PowWoworld developer Pocket Perry has revealedthat Nintendo and the Pokemon company want
5,000,000 yen each, plus late payment damages,and also for the game to stop being sold
entirely, which is a weird way of framing this.
It's kind of the first thing last or the lastthing first.
But I do want to give IGN credit for at leasteven though it didn't make their giant picture,

(27:28):
at least mentioning that the real issue here isthat an injunction is being sought, which is
where I want to talk about item 3, designsslash expression slash what we mentioned
earlier in this video that when we talk aboutpatents, we aren't talking about ideas.
You can't patent an abstract concept.
You can only patent the way that you put thisthing forth in the world, the expression, or

(27:52):
the way the technology actually makes thethings happen.
So when here, Schwifter on Twitter says whoeveris presiding over the Pokemon powered case
should just dismiss it and dismiss it withprejudice.
Imagine claiming you own the right to capture abeast and write it or capture creatures and
make them fight.
Tons of games have stuff like that.
Nintendo should be ashamed.
I do think that this is a person caught in amisunderstanding.

(28:16):
Of what is patented.
And I don't really blame them.
One thing I do want to highlight here is thatpocket pair deliberately made this statement to
highlight these particular patents, to pointout that they are issued after the date in
which the game released.
And they don't really help people understandthe things we're talking about here.
And it's not pocket payer's job to help peopleunderstand that, but I do think they are taking

(28:38):
advantage of certain of the ambiguities, ofpeople's understanding of intellectual property
to make their case stronger in the public eye.
And, of course, in some ways, that's the job ofthe press office of the company.
So I'm not really holding it against them.
But I do want to point it out because I thinkthere are a lot of folks that think like this,
Mr.
Swifter, in respect of Nintendo at this point.
And this is where I wanted to talk about whatpatents actually are.

(29:00):
And this is the United States law again.
But Japanese law is going to follow much ofthis even if their court system is
substantively different than US.
So they might have different opinions onspecific marginal cases on this point.
So what is a patent?
This is the Cornell Law School LegalInformation Institute.
This is one of my favorite websites, so docheck it out if you like these legal

(29:21):
conversations that we have here in virtuallegality.
Granting exclusive rights to the inventor isintended to encourage the investment of time
and resources in the development of new anduseful discoveries.
And reasonable lines can differ on this.
But the idea of patents is that, hey, we wantpeople inventing things.
We want people coming up with new ideas thatmakes our lives better.
And so we're going to grant them a limitedmonopoly on making money off those ideas

(29:44):
because that's a good way to incentivize themto keep making them in exchange for this
limited monopoly.
The US Patent and Trademark Office, the USPTO,requires immediate disclosure of the patented
information.
Once the term of protection has ended, thepatented innovation enters the public domain.
The 5 primary requirements for patentabilityare, 1, patentable subject matter, 2, utility,

(30:08):
3, novelty, 4, non obviousness, and 5,enablement.
Now what's patentable subject matter?
Well, the patentable subject matter requirementaddresses the issue of which types of
inventions can be considered for patentprotection.
Under 35 USC 101, the code broadly definescategories for patentable subject matter as any

(30:29):
process, machine, manufacture, or compositionof matter or improvement thereof.
The Supreme Court found that congress intendedpatentable subject matter to include anything
under the sun that is made by man.
According to the court, the laws of nature,physical phenomenon, and abstract ideas are not
patentable.
The relevant distinction between patentable andunpatentable subject matter is between products

(30:49):
of nature, living or not, and human madeinventions.
The traditional rule stated that printed matterand business methods were not patentable.
Nonetheless, courts have called into questionthat traditional rule.
In 1998, the federal circuit held that a systemof conducting business can be patentable as a
process even though it does not act on anythingtangible.
The rule against patenting printed matter stillretains its force, and there's a bunch of stuff

(31:10):
on printed matter.
But notions of business method patents, whichare, again, another area of controversy for
intellectual property lawyers and patentlawyers, is that you can invent a process that
didn't exist before, that doesn't exist justsolely in nature.
It's an idea of the human brain ingenuityinvention, and that it can improve things in

(31:31):
such a way that it should be protected, thatsomebody shouldn't be able to copy you in
exactly the way that you have invented it.
And so business method patents, like I said,are an area of controversy, but they are in
existence in the United States.
The second requirement is utility.
You know, an invention has to be useful.
Credible utility requires that logic and factssupport the assertion of utility or that a

(31:51):
person of ordinary skill in the art, here gamedesign or game creation, would accept the
disclosed invention is currently capable of theclaimed use, which is to say a couple of things
here with utility.
You can't just have ornamental designs bepatented.
They have to be of usefulness.
They can't just be essentially pretty.
Copyright is really for artistry and patentsare for utility.

(32:12):
But the other aspect of this is that you can'tjust kind of claim things on a science fiction
level that could possibly happen in the futureif a person of ordinary skill in the art that
we're talking about couldn't otherwise see howthis could work.
Right.
You actually have to invent the thing.
You can't just posit something in your brainand put it forth.

(32:32):
Novelty.
The novelty requirement described under 35 USC102 consists of 2 distinct requirements,
novelty and statutory bars to patentability.
Novelty requires that the invention was notknown or used by others in this country or
patented or described in a printed publicationin this or another country before the invention
by the patent applicant.
And here's where we get into that issue that wetalked about earlier with respect to the

(32:54):
patents at issue here, which is that Arceus orArceus was shown in trailer form before it was
released.
And so Nintendo and Pokemon Company actuallyhad to go and tell Japan that we are deserving
of an exemption under the Japanese Patent Actthat says even though we publish these

(33:14):
trailers, it's still our patent.
And I'm not again a Japanese patent lawyer, soI don't know how justified all of this stuff
is.
But it's clear that even in 2021, the patentsthat we're talking about at the at the heart of
this power of the issue were were applied forand granted later than you might have expected
if you're Nintendo or the Pokemon company.

(33:35):
And so what we're talking about is an issuewith this whole process that Nintendo has for
protecting their intellectual property.
It's not just limited to power world.
Continuing on from there, the statutory barrefers to the fact the patented material must
not have been in public use or on sale in thiscountry or patented or described in a print

(33:56):
publication in this or another country morethan 1 year prior to the date of the
application for a US patent.
In other words, the inventor may lose the rightto a patent if the inventor delays too long
before seeking patent protection.
Right?
If you're thinking about this as a quid proquo, the way this works is the government
grants you monopoly on your invention inexchange for you disclosing it very soon after
you invent it, Right?
So that the public can know about it and thatpeople can build off of that invention.

(34:19):
That's kind of why you get the monopoly in thefirst place.
Non obviousness.
Congress added the non obvious requirement tothe test for patentability with the enactment
of the Patent Act of 1952.
The test for non obviousness is whether thesubject matter sought to be patented and the
prior art is such that the subject matter as awhole would have been obvious to a person
having ordinary skill in the art at the time ofthe invention.

(34:41):
Here's an area where I think that if we'retalking about these Japanese patents being
issued in the US, Nintendo might struggle.
Right?
When we talk about okay.
So you've got a notion of how Pokemon works.
You throw a Pokeball at a Pokemon in a turnbased battle, and maybe they pop into the
Pokeball.
Maybe they don't.
If they do, you're captured and they're on yourteam.
And you've said, okay, 3 d games exist.

(35:02):
And so we're gonna say 3 d games.
You could throw a ball at somebody that's justout in front of you, and that ball could hit
them and they could capture it.
And I think that a reasonable argument in thevideo game space, the prior art in video games,
is that a reasonable person with skill incrafting video games would be able to look at
these two concepts and say, yes.

(35:24):
That is an obvious idea.
And the way your buttons work is not so weirdor unusual that a normal person couldn't have
come up with that as the way that you fire aball at a Pokemon or a monster in any event.
Now there's a real question as to whether PowWorld or Craftopia or any of their other games
that we talk about in this space are too closeto Arceus, and whether the Arceus patent, of

(35:45):
course, should have been granted in the firstinstance.
But non obviousness is probably where I wouldfight the most on this Nintendo stuff, which is
to say, okay.
It's new and it's not identical to Pokemon.
It's the reason why Temtem and the other thingsthat are turn based and have these capture
mechanics don't have this same issue, but areasonable person could come up with this on

(36:07):
their own.
The court held that the court determines nonobviousness through basic factual inquiries
into the scope and content of the prior art,the differences between the prior art and the
claims at issue, and the level of skillpossessed by a practitioner of the relevant
art.
The court examines whether the improvement ismore than the predictable use of previous art
elements according to the establishedfunctions.
And there's a few more things here that I don'tthink are directly applicable to our situation,

(36:30):
but it's important to note that these patentsare protection of the way that the computer
interfaces with the controller, the way theperson interfaces with the controller and the
computer, and the way that's all displayed on atelevision screen.
It's not specifically the concept of capturinga Pokemon or the concept of riding on a
monster.

(36:51):
Similarly, we I also wanted to point out thatJapan is covered by certain patent law
treaties, and other areas of harmony betweenthe various jurisdictions on the earth.
And so while, as I've highlighted here, thepatent law treaty itself does not harmonize
substantive patent law, the decisions of thecourt as to how these words would be

(37:11):
interpreted, they are generally applied in asimilar fashion across the Japanese Patent Act,
the US laws, and other laws of variousjurisdictions.
So here's the WIPO, the World IntellectualProperty Organization, highlighting how Japan
interacts with the rest of the world.
So here's Japan.
They've got these links here to the variousthings that Japan does.

(37:32):
And Japan is a party to all of these treaties,all these conventions, all of these agreements
that make it so that Japan and the UnitedStates are moving in the same direction on
intellectual property questions, even if theyaren't in lockstep on these things.
So you can take the word of a US attorney.
You could take the word of various otherjurisdictions, intellectual property attorneys,

(37:54):
as helpful for understanding the Japaneseintellectual property system, even if it's not
the definitive way that Japan will interpretthese various questions.
And so dates, damages, designs, I think theseare all misconceptions in various ways that
people online are misconstruing what'shappening here, even though I wind up in a
position that is relatively similar to some ofthose comments, which is to say, I think

(38:16):
Nintendo is pursuing a course against pocketpair and paleworld that is more indicative of
desperation, more indicative of a company thatis irritated with the designs of these monsters
looking so much like Pokemon, but can't find acopyright claim against this company and are so
pursuing a different legal method that isperhaps close to what folks have otherwise

(38:39):
called bullying, including Florian Mueller, whowe've talked about in virtual reality in the
past, specifically with Apple versus Epic, butwho does sometimes frequent virtual reality
episodes and talks about these things at lengthon Twitter and elsewise.
In his article for GamesFray, he says he has aquick commentary on the facts about Nintendo
versus Pow World.
So let's take a look at what he had to say.

(39:01):
Nintendo and the Pokemon Company versusPocketPair.
Patent infringement lawsuit attempts tomonopolize game rules.
And here, I think he goes a little bit far inhis editorializing, but this is a reasonable
minds can differ kind of get 3 lawyers in aroom, get 5 opinions kind of concept.
He says, look, I've got an I a site called IPFray.
In general, we are always talking about patentinfringement lawsuits, and we frequently

(39:23):
acknowledge that innovators have the right toprotect their inventions.
But in this particular case, it's troublingbecause it includes, bullying with
opportunistically drafted patents.
1st, it is a clear case of bullying, saysmister Mueller.
Nintendo is a far older and larger company thanPocketPair with extensive experience in patent
prosecution and patent infringement litigation.

(39:44):
What Nintendo originally insinuated in a publicstatement was that Pokemon specific
intellectual property rights or assets wereused in the making of Power World.
In fact, everybody understood when Nintendomade that statement that they were going to
seek potentially a copyright claim againstPower World, even though I thought that from
what I could tell of how Power World operated,that was unlikely.
It would obviously be unlawful to attach thePokemon label to a 3rd party game that would be

(40:07):
trademark infringement or to import Pokemoncharacters into another game without
permission.
Back in January when Nintendo issued thestatement, it apparently had nothing specific
in its intellectual property portfolio tounderpin its suggestion of infringing acts on
pocket pairs part.
All that Nintendo has done in the meantime isfile new patent applications in February,
March, and July, building on older patentfilings from 2021, and it's good for him to

(40:27):
note that, and to assert those game rulepatents in Japanese court.
Now here he takes a leap.
Right?
He says those patents are game rule patents,and this is, to my mind, an attack vector that
perhaps doesn't attach specifically to thisissue, but which is a common discussion point
in intellectual property circles with respectto copyright and game rules.
Many of you may be familiar with the fact thatHasbro and Magic the Gathering, Wizards of the

(40:51):
Coast often seek to protect other their rightsto Magic the Gathering against other card
games.
As a for instance, I was a Kickstarter.
I think it was a Kickstarter supporter of adigital card game called Hex a while back, and
they got dinged by Hasbro for having, amongother things, 20 health points, for the other

(41:16):
side that you had to take off in the card gamethat they were, exposing.
And Hasbro said that we were protected in the20 health point concept because that was a
specific way that our game operated, and sothey moved to, like, 19 and 21 health points,
and that's always been ridiculous in my mind.
That is certainly outside what the intellectualproperty laws are designed to protect.
That really is an abstract concept.

(41:37):
That really is a game rule.
But a lot of folks have talked about that issuein many contexts.
And to me, this reads as I don't know if any ofyou have been in debate in high school or
college or otherwise, but when you do debate,you set up a series of kind of research points
for things that are likely to be argued againstyou in a debate round.

(41:58):
And you have these folders or these papers thatyou can pull up and say, this is my defense to
that point.
This is the argument that I would make againstthat particular issue, and this strikes me as
something that is directly related to thosekinds of claims, and not so much this claim,
which really does have a technologicalcomponent.
But I don't wanna speak for mister Mueller ingeneral.
Certainly, he is capable of defending his ownposition on this.

(42:20):
I just think that here, we have leapt one steppast what we're actually talking about here,
which is to say that these are game rulepatents, which he will argue for in this
article as we will see.
Pursuit of injunctive relief is key.
Damage claims are negligible for now.
As we talked about earlier in this video, thisis 100% the truth.
At first sight, one might be misled intothinking that what Nintendo is doing here is
not going to do major damage or that Nintendowas simply trying to rake in some license fees.

(42:44):
Not so.
Pocket Player explains what remedies thecomplaint asked the Japanese court to order,
including an injunction.
The real threat to Pocket Player is thatrequest for an injunction.
The 3 patents in suit were filed and publisheda while after Palworld's release, thereby
limiting the damages period and capturing onlysome more recent Palworld sales.
Now he then describes their strategy,Nintendo's, as a patent thicket strategy.

(43:04):
What Nintendo is trying to do with these 3patents in suit in this litigation and possibly
others that are not in the making and may notbe discoverable yet is to create a patent
thicket.
That term describes a multiplicity of patentssharing a common context in an attempt to block
all roads.
And I do wanna mention that Florian Mueller isa patent attorney, and so I do want to, demure

(43:25):
on this particular issue and say, hey.
He knows more than I do on the way that thesespecific things operate in, legal function, so
I wanna I wanna give him the right to speak onthese issues.
The 3 patents in suit were derived from anoriginal patent application from on December
22, 2021.
We showed that earlier in the video.
After Power World's release, Nintendo tried totweak the patent claims, in order to obtain

(43:47):
patents that would read specifically on PowerWorld, specifically applicable to Power World,
and collectively and possibly along with otherpatents have the effect of a patent thicket.
These are the 3 2024 patents that Nintendoderived.
We looked at those already.
Then he says no technological innovation, justnew game rules.
The problem is that none of what Nintendoclaims to have invented is a technological
invention.
All the innovation lies in the related gamerules, but game rules per se are not

(44:10):
patentable.
The presence of a game rule in a patent is notfatal as long as there are technical invention
involved.
Validity is gonna be the single most importantbattlefield between Nintendo and PocketPair,
and it is where Nintendo will face some seriouschallenges.
And, again, that validity is gonna bechallenged primarily in the boardroom.
It's gonna be challenged in the settlementnegotiations, not likely in court because
that's too expensive and too time consuming foreverybody here.

(44:32):
But in that settlement negotiation, leveragestill matters.
Right.
If you've got a good case that your patent isgoing to die if we take this to court or you're
going to look bad, you're going to lose it inJapan, you're going to lose it in United
States, and you're going to lose it in thecourt of public opinion, then you are more
likely to settle on terms that are morereasonable to me if I'm pocket pair.
Right.
So this all matters even if this winds upgetting settled.

(44:52):
But I do wanna say that I don't think thatmister Mueller is giving full credence to
everything that is listed here or the way thisis filed.
Right?
One of the things that Japan categorizes thisis as is controlling the output signals based
on game progress involving additional visualinformation, for example, by overlaid a
simulator heads up display, etcetera, etcetera.

(45:13):
So it's the interface, it's the controllerfunction, it's the display, it's all these
various things, And that doesn't read to mespecifically as game rules.
Right?
This isn't hit points on the opposite side ofthe table for Magic the Gathering.
This is something a little bit different.
And so I do separate from mister Mueller onthis point on that notion, even though I
understand what he's saying here is that theseare overly broad.

(45:34):
These probably shouldn't have been granted, andthere's all sorts of problems with validity
here.
And we don't wanna see games development, gamesmove forward with this kind of shroud hanging
over them for any future inventions, any futuredevelopments in the game space.
Many highlights what these things say, and youcould certainly read those.
I will, of course, link these.
I won't link them in the because YouTube hatesthose links, but they will be available on the

(45:57):
podcast page to this episode, which will belinked, on the description to this video
because YouTube allows that for some reason.
The patent claims reference a lot of technicalthings and concepts, but there is nothing in
there that constitutes technological innovationin the sense of making better use of computer
resources or enabling a computer to solve atechnical problem with technical means in a way
that was not done before and would not havebeen obvious to do.

(46:20):
It's not a faster three d engine.
It's not in a more efficient use of Internetbandwidth or anything like that.
And here I think, mister Mueller, is again toonarrow on what should be granted a patent, but
I also think that what Nintendo has beengranted a patent on is too broad.
So we're in agreement on the ends of thisdiscussion even if we're not on the way that we
get there.
Nintendo's patents don't tell them anythingthey would need to know because they couldn't

(46:43):
easily figure it out themselves.
Then the question is, does the 2021 applicationactually back these things up?
At least one of the underlying 21 2021applications acknowledged that there are game
programs in which a care player characterthrows a ball at a character in a virtual
space, but the patent applications then arguethat they talk about how to do something
different.
That is true, but he argues is all in the realmof game rules.

(47:07):
PocketPair can't prevent Nintendo and thePokemon Company from filing for derivative
patents in 2024 that claim the priority of a2021 patent.
Patent law allows that, but there could bedisagreements over whether the original 2021
applications disclosed everything that the 2024applications claimed.
Right?
We talked about these notions of continuations.
But if you go outside the bounds of what wasoriginally contemplated in the earlier patent,

(47:29):
then you shouldn't get that priority to theearlier date.
And that becomes a problem if you're trying tosue for infringement of a game that's already
been released.
Applications for the game industry, and here'swhere I think you get the reason behind this
article for Games Frey and mister Mueller.
If, however, companies write patentapplications that are effectively just
smokescreens, the net effect is that companiesmonopolize game rules.

(47:51):
That would set a terrible precedent for theindustry.
It would lead to a lot of litigation betweenindustry players, and it would subject game
companies to so called patent troll lawsuitsover game rules.
Making games would become a minefield.
Nintendo and the Pokemon company have everyright to protect their crown jewels against
plagiarism, but the facts that have now becomeknown about their Japanese patent lawsuits
against PocketPair suggest that there is noplagiarism issue.
It's just an attempt to leverage the patentsystem against a smaller company and late

(48:14):
entrant to the market that has made andcontinues to make many millions of gamers happy
because of its fresh creative ideas and the wayit executed them.
No one and nothing would have stopped Nintendofrom making a PAL World style game.
It may not have wanted to do so for conceptualreasons.
It may also have been too complacent to rethinkits game concept, but its patent law fair does
nothing to back up its January 2024insinuations of plagiarism.

(48:35):
Nintendo has merely come up with a bunch ofcontorted patent claims drafted a while after
Pal Worlds release.
And that's a fair way to look at this even ifit's not the way that I see this particular
issue.
This is clearly coming from a place that viewsNintendo as a patent troll and is attacking
pocket pair because it's the only way that itcan do so.
And I agree that Nintendo seems to be agitated,irritated by the existence of Power World in a

(48:59):
fashion that probably isn't justified for theprotections that Nintendo is otherwise
afforded.
But is this bullying?
I would ask you in the comments or in the chatif you're watching this live to let me know
what you think on that particular issue.
Is it bullying?
And if you like this conversation, if you likethis kind of content on YouTube or in your
space, please do consider supporting thechannel at the links in the description,

(49:19):
issuing memberships, super chats, or otherwise,just liking, subscribing, and telling your
friends that we're having these conversationshere.
Thank you so much for joining me.
I do think that this is an interesting issuefor both Nintendo and the video game industry
at large.
And while I don't come across or come downquite as hard as mister Mueller does on
Nintendo, I do think they are the actions ofsomebody that is desperately seeking some kind

(49:44):
of legal redress that is maybe not moreobviously given by the intellectual property
protections that they have.
And so let me know what you think, and I leftthis on the screen the whole time, but let me
know in the comments, and I will try to capturethem as they come.
If you wanna highlight them with a cue or awhole law, let me know.
Otherwise, I will end this video, and we can goon with our lives.

(50:07):
Darth Mack says it's bullying.
Darth Mack, final say on this.
It's bullying.
If you disagree, let him know.
If you agree, let him know.
Akeruki says it feels like bullying the wayNintendo is going about it.
I like I said, I'm not sure I would use theterm bullying, but, again, I'm a corporate
lawyer, so I'm a little bit more inclined maybeto allow for certain aspects of the desperate
legal move.

(50:28):
I do think it strikes a lot of folks as unfair,and I think that's a justified feeling for the
people that are looking at this question eitherfor the first time, from a legal perspective or
otherwise.
Jdrec100 says it kinda does feel like it'sbullying.
K.
A lot of folks here in this chat, maybe in thecomments later on, think this is bullying, and,

(50:51):
so does certainly, Florian Mueller.
Mann agrees that it's patent trolling.
Southern touring would describe it aspredatory.
And I think those are all interesting terms forthis particular issue.
I think Nintendo, like I said, is movingforward in a way that strikes many as unfair.

(51:13):
Midnight Drea says bullying.
Thank you, Midnight Drea.
Darkno Naze asks a question, what about thefact that Japan has no fair use in their law?
So fair use is a concept that applies tocopyright.
It's not a patent concept.
So we're talking about inventions here.
And I didn't do one of the things that I do ina lot of these videos at the top, which is talk
about the difference between patents,copyrights, and trademarks.

(51:35):
But importantly, copyright protects theartistry.
Right?
It protects the characters.
It protects the way things look.
It protects the writing.
It protects those aspects that are purelyornamental in design.
In this case, they're talking about inventions.
They're talking about specific mechanismsbehind the way a game operates that they got
protection from in Japan.

(51:56):
And again, from a United States lawyers pointof view, I don't think all of these would have
been issued in the United States.
I don't think all of them are are non obvious.
I don't think all of them are reallyinventions.
So if it feels like bullying, that's probablypart of the reason why if you're coming at this
from a perspective outside of the Japanesepatent system.
It may be more normal in Japan.
It may be specific to the way Nintendo getspatents issued in Japan.

(52:17):
I can't speak to that issue particularly, but Ican say that once they are issued, it's not
unusual for a company to go and seek thedefense of those patents.
But fair use doesn't come into it.
M Davis says it's definitely bullying.
Aaron says it's just dumb.
Fair.
Ankeruki says, I mean, legally, it could becompletely above board, but the flavor of the

(52:40):
action chain feels bullying ish.
Yes.
I don't mean to suggest that just becausesomething is legal, it isn't bullying, or just
because something is legal, it's right.
Right?
One of the things we saw as a term used inpolitics in the United States this past couple
of months is the notion of lawfare, which is acute little portmanteau that I like, but it's
the suggestion that you can use the legalprocess in a manner that is designed to punish

(53:03):
even if someone hasn't broken the law.
And this particular case, Powell World pocketpair maybe didn't break the law, and this feels
you know, some in some respects, similar tothat kind of law fair concept.
Just because this is a fully different culture,so it's hard to look at from the outside, it is
a fully different culture, and they havedifferent intellectual property laws than us.
But they are designed around the same premises,and they are supposed to be at least in line

(53:27):
with the United States and other jurisdictions,if not in lockstep, in order to be a part of
those treaties in the way we protect ourintellectual property amongst those various
jurisdictions.
Rambling entertained, I think, probably mighthave the phrase that I agree with the most so
far, which is desperate leverage of resources.
Certainly, if you are constructed as an oldschool company with a lot of lawyers on staff

(53:49):
that has a litigation history, then this is theway you might use those lawyers to say, look.
We don't like power.
We don't like pocket pair.
Find us something.
And this is what the lawyers came up with.
I certainly don't think it's as potentiallystrong as a copyright claim would have been.
But I do think that the end result, even withwhat we know now, is still a settlement is
still a settlement that might include slighttweak tweaks to the way Powell World operates,

(54:13):
but doesn't otherwise take Powell World awayfrom the players that are playing it right now?
Banana Bobert says the patent feels kind ofabsurd.
So even if the legal action is valid based onthe patent, the legal action still feels wrong.
And I think that is part of the story here.
Right?
The patent feels overly generalized.
It feels like one that probably wouldn't haveissued in the same way in the United States in

(54:35):
2021 or in 2024.
So if you take both of those patents and say,well, I don't feel like those probably are
deserving of protection, then enforcing themfeels like bullying, however it might otherwise
look.
The Lucien says, Hoag Law, question,hypothetical on the damages for not licensing.
If the patent holder never licensed or hadintent to, how can that be calculated?

(54:57):
It's a good question.
Honestly, mostly when you don't have an easyway to calculate damages in intellectual
property infringement question, the damages areset forth in the statute at some predetermined
rate.
Right?
One of the things that happens with what we sawin the pocket pair announcement is that they
asked for 5,000,000 on the infringements,5,000,000 yen.
That could be a number that just is plucked outof thin air.

(55:17):
It could be a number that is comported to bedesigned around either the what the statute
puts forth or the requirements to get aspecific court to hear your claim.
Right?
We see this a lot in legal issues in the UnitedStates and the way media reports on them, which
is to say when you get to the end, when you'reasking the court to do something, you say,
we're asking for at least x amount of dollarsor whatever the court deems appropriate to give

(55:41):
us.
And a lot of the times that x amount of dollarsis reported on by the media is what you're
asking for, but, realistically, it's just thethreshold to get into a specific court system.
And so we don't know the answers to thosespecific questions.
So in answer to damages being difficult tocalculate, in intellectual property issues,
they're often put more than the statute.
Here, 5,000,000 is such a round number, thatit's probably just used as a threshold concept

(56:05):
to get into court or to make sure the court cansee them.
Liam Gray, does injunctive relief requireirreparable harm in this case, or is that only
for preliminary injunctions?
Yeah.
The irreparable harm concept is only for thepreliminary injunctions or temporary orders
that a court gives at the front end of anadjudication.
When we ask for injunctive relief in thisparticular case, it would be they're

(56:27):
infringing, they can't fix it, and so theyshouldn't be allowed to be sold.
That's what we're asking the court to impose.
Like any other kind of action based orequitable relief of a court, it's all going to
be on the judgment of the court as to whetherthat is granted or not.
And, again, the legal system on the whole isbetter positioned to move money between
accounts to provide damages.

(56:49):
That's what a legal remedy is in a certainimportant way, and injunctive relief is always
a little bit more than that.
But no, you don't have to prove various otheraspects of that in a US court system.
What the standards are in a Japanese courtsystem is, I couldn't say.
Just because as it feels wrong, but I wonder ifit's because it's both Japanese culture and a

(57:11):
corporation rather than something more modernor forward thinking.
Well, I can't speak specifically to Japaneseculture not being modern or forward thinking,
but I do know that this case is between 2corporations, one of one of which is older than
the other.
But this is not an issue where you've got,like, the mom and pop or or or the little old
lady on the street fighting against the big badevil corporation.
These are these are 2 corps, one of which hasmade an enormous amount of money this year,

(57:35):
with Power World, and one of which was, ofcourse, Nintendo.
So I don't know that that comes into it as muchas it the desperation, I think, is what people
react to a lot on this.
It does feel like Nintendo would have brought acopyright claim if they could have.
It does feel like Power World is only in theircrosshairs because of how close to the sun the
designs of the pals flew.
And then Nintendo scrambling to find adifferent avenue to get them feels unjust in

(58:00):
certain important respects.
Timmy Zinni says it doesn't matter if it feelslike bullying or if you don't like it, if you
then turn around and buy Nintendo's next gameconsole, etcetera.
Well, I mean, this is certainly not the kind ofthing as it stands right now that would prevent
me from getting the Switch 2 or the nextNintendo product.
So I think you're right there, but I I thinkalso that it's probably a little bit too black

(58:26):
and white.
Like, you could care about this a lot, butmaybe not as much, as the next Nintendo product
or switch or whatnot.
And you could say that that, yes, that'sencouraging them to act this way, but you might
be able to just separate those things in yourmind.
Southern Torrance says, that's like Mario ranaround collecting coins and Sonic ran around
collecting rings.

(58:48):
Well, a little bit.
Although, at no point that I'm aware of wasMario collecting coins a patented mechanic, and
Nintendo might have issued a patent there.
But again, even if you can imagine somethinglike PowWoworld out there existing that might
otherwise infringe on this particular patent,Nintendo is not under an obligation to enforce

(59:08):
its patents against any particular party.
PowWoworld and Pocket Pair clearly upset them,agitated them, frustrated them, however you
wanna describe it, in some important way.
Marketing it as Pokemon with guns movingforward with the designs that they did.
And this is the kind of thing that happens whenyou do that.
Right?
This is if you were my client, if you'resitting across the desk from me, this is the

(59:29):
kind of thing where I say, well, you might notbe infringing.
You might not have these legal obligations, butyou might piss them off.
And a lot of people with money and lawyers canmake your life pretty miserable even if they
wouldn't win at the end of the day.
So this might be that kind of case.

(59:51):
And Davis says, okay.
If it's not bullying, then it's at least a formof mafiosi intimidation.
The Nintendo mafia.
Wow.
Well, m Davis, you you might be right.
Look.
There's a lot of people in the chat and in thecomments that suggest that they feel this
negativity towards Nintendo in their actionshere.
And, again, I will fully admit that I'mprobably less inclined towards that feeling due

(01:00:13):
to my background as a corporate lawyer havinghad these conversations with people in the
past, and I'm fully willing to yield to whateverybody else feels about these things.
Again, I I brought up the Mueller articlebecause it was so self evident that he felt
very strongly about what Nintendo was doinghere, and I found myself kind of tacking back

(01:00:34):
towards the middle from that standpoint.
But if you feel like it's mafiosi intimidation,I'm not the one to tell you that you're wrong.
JDR EC 100 says, this situation probably wouldnot feel as bad if Nintendo wasn't well known
for legal aggression and everything thathappened after Pal Worlds release.
That's probably right.
If they were more genteel company or if theyreally were beloved by everyone in the way that

(01:00:58):
they operate in the legal sphere, then youmight not feel as negatively as you wind up
feeling in this particular instance.
God Emperor Sofa King asks, do you thinkNintendo will eventually bite off more than
they can chew when it comes to suing othercompanies, etcetera?
Maybe.
Probably not in this case, certainly.
This, again, feels like something where if I'mcounsel the pocket pair, I'm saying, alright.

(01:01:21):
Well, the risk is that they pull the game offentirely.
You can't make any of the money that you'reotherwise making on this, and that even worse,
they could potentially force you to to removeit from other accounts and to to make it worse
for people and have all sorts of issues withGame Pass and Microsoft and things that you
don't wanna deal with.
So if they don't have big damage claims and youcan tweak a few things a little bit to get

(01:01:43):
outside the patent, then why wouldn't we try tosettle this?
And I think that's where we wind up finishingthis particular issue with pocket wear pocket
pair and power world.
Bob, isn't there an abuse of power?
Well, the court system in and of itself issupposed to be evaluating essentially how

(01:02:04):
people are using the law.
Right.
It's supposed to be blind justice.
It's supposed to be interpreting things on thenotion of getting things right more than it
gets it wrong.
But certainly reasonable minds, cynical minds,less optimistic minds can look at the justice
system of various jurisdictions and say theyaren't always perfect at that.
Right?
Nintendo is a big player in Japan.

(01:02:24):
And so is there an abuse of power?
Maybe.
But patent trolls exist.
They exist for a reason.
And the real correction for that kind ofbehavior is specific statutory answers that say
you can't do x, y, or z.
You can't sit on these patents and do them doit this way.
You can't submarine patent claims.
You can't do continuations for this purpose.
And we just saw as part of this video that alot of those efforts, a lot of those endeavors

(01:02:49):
to get certain of these aspects corrected aresquashed by patent holders.
Right.
Because they are currently in the cap rate seatfor how to use these things.
And we saw this also with the DMCA andcopyright and YouTube.
Right.
When the copyright office looked at the DMCAissue and whereas people that are on YouTube
all the time, like myself, can see that bigcompanies are abusing the DMCA to issue

(01:03:14):
copyright takedown notices that have nothing todo with copyright or that are otherwise well
within fair use and that there's very littleway to prevent that activity.
And the copyright office did a report on it andbasically found that there wasn't enough power
given to the copyright holders and that theyshould be able to use more DMCA takedown
powers.
And so there are all sorts of institutionalthings that we can talk about from a policy
perspective, but I'm not yet a politicschannel, and so we aren't gonna go into that

(01:03:38):
too deeply.
RJ says, hey, whatever you wanna call it, Ithink it's fair to say that Nintendo is being
malicious.
They didn't like Power World being so popular,and everyone's saying that Nintendo was lazy,
slow, and they'd not have done it first.
Yes.
I think they're agitated by this, RJ.
I think that is astute and correct.
And I do think that this happens to Pocket Pairand not to some of the other parties because
they were so close to the sun because theymarketed it as Pokemon with guns, and that's

(01:04:02):
what irritated Nintendo the most.
Hey.
Hettinger says, honestly, I don't think thisshould be considered novel.
I agree.
From what I've seen described, and I'm not apatent lawyer, and so I do yield to other
patent lawyers' advice on these particularconcepts, but from what I've seen in those
patents, from actually reading that the claimsand not just the abstracts of the descriptions,

(01:04:23):
it doesn't appear to me to be something that isnot obvious to a person practicing the art of
game development.
Right?
So I I tend to agree that these patents seemlike they shouldn't have been issued in the
first place.
Carolina lady says, I worry if they win, theycould stifle a game developer's creativity.
Agreed.
The problem with patent trolls, and as FlorianMueller so rightly says, is that if you're

(01:04:45):
constantly worried that your ideas could bestruck down even after the fact, even if you
say pocket pair went through all the lawyeringthat you can imagine, looked at all the prior
art, said there are no patents that actuallycover this area, and then get hit by a
continuation authorized after their gamereleases, then game developers all over are
gonna have a sword of Damocles hanging overtheir head, and that's what Florian Mueller is

(01:05:07):
concerned about.
And so I think that's a totally justifiedconcern, even if I don't think that Nintendo is
quite as bad of an actor as he does.
Thank you for the super chat.
Alright.
And since my voice is almost giving way here, Ido wanna, capture the last couple of comments.
A lot of people have a lot of things to say onthis.

(01:05:29):
Lucien asked a question.
Don't know if you know this answer.
Can someone in Japan argue against the patentfiled in Japan because it is not novel
somewhere else in the world even if it is novelin Japan?
I don't know the answer specifically becauseI'm not a Japanese lawyer, but in general, the
answer is yes.
In the United States, you can argue that it'snot novel.
It can't be protected because it existssomewhere else in the world.
If it exists at all, it's not something thatyou deserve protection for.

(01:05:53):
And Japan might have some specific exceptions,might have some specific rules around that
concept that I don't know about.
But overall, in generalities, yes, you canargue that something exists outside your
jurisdiction, that would prevent yourjurisdiction from issuing you the protection
you're requesting.

(01:06:15):
Ray X says, I think this would look badregardless since PowerWorld feels like a
parody.
So parity, again, is an exception essentiallyto the application of copyright.
And I understand why people are getting thesekind of balled up here because, honestly, the
reason that anybody thinks Nintendo is suingpocket pair is potential copyright
infringement.
Right?
The design of the pals.
But that's not what they're getting sued over.

(01:06:36):
That's just what seems to be the kernel at theheart of this particular dispute.
And so parody is an exception to your monopolycontrol of your copyrighted materials.
Somebody can parody it.
Somebody can satire it because we like thefirst amendment.
We like freedom of speech here in the UnitedStates.
But this is a patent infringement claim.
There is no exception for parodying a patent.

(01:06:58):
So sorry, r x y z.
That's the case.
This is dangerously close to this is making funof me, and I'm gonna use the law to make it go
away.
I don't disagree.
Nintendo's clearly, I think, irritated aboutthis.
I think that it also is the case that a lot ofpeople were making noise when Pal World came
out that Nintendo should do something aboutthis.
And Nintendo said, well, if the people want usto, then maybe we should.

(01:07:20):
Space Shot says it's hard to find a middleground where gaming advances by building on
great ideas of the past without outrightstealing them.
The same thing is going on in music.
When is it inspiration versus theft?
Well, here, I think Pal World is a fantasticaddition to the game, library as it were.
I think it is a concept that is similar toPokemon or other monster capturing games.

(01:07:41):
Pokemon is not the only one of those, but takesit in a new direction.
It combines survival crafters with monstercapturing elements.
And I think that's exactly what we wanna see,the evolution of products and media is somebody
saying, well, what if these two flavors wenttogether, and we suddenly have the peanut
butter and jelly sandwich?
And that is its own kind of invention,especially if it's not obvious to anybody else.

(01:08:03):
And certainly, the fact that nobody's done apower before or even tried is suggestive of the
fact that it is on its own a novel invention ofsome kind and maybe should be afforded
protection of itself.
Banana Bobert says, Hogue, I'm reminded of thenemesis system patent.
It was a neat system that's never been usedagain.
Game dev is art adjacent, so patenting gameplaysystems slash mechanics leads to stifling the

(01:08:23):
field.
Yes.
And I think Warner Brothers in this particularinstance that owns the nemesis system is its
own kind of worst enemy because Warner Brothersand their games development arm have had all
the issues that have gone along with theircompany being split up and divided and sold.
And so I think it is a shame that the nemesispatent hasn't been used elsewhere, but it
wouldn't surprise me if it gets licensed out inthe near future.

(01:08:53):
Alright, everybody.
And I I see there are a couple more questions,but I think I am gonna call it here because I'm
a little bit out of voice.
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(01:09:14):
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(01:09:37):
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