Electronic Arts Loses Preliminary Round In “Battlefield 3” Video Game Case
by Jerry Glover
July 31, 2012
Back in April of this year, we reported on a case involving a new video game, “Battlefield 3,” from game producer Electronic Arts (EA). At that time, EA had filed a declaratory judgment action in the federal district court for the Northern District of California asking that the court find that its use of Bell helicopters as part of the game did not infringe Bell’s trademarks or trade dress in and to those helicopters. Bell (and its intellectual property holding company, Textron, Inc.) then filed a counterclaim alleging that EA’s use of the helicopters did, in fact, infringe upon those trademarks and trade dress as well as create a false designation of endorsement or sponsorship under section 43(a) of the Lanham Act (15 U.S.C. Sec. 1125(a)). Textron holds registered trademarks for “AH-1Z”, “UH-1Y” and “V-22”. It also claimed common law rights in the marks “Viper”, “Venom” and “Osprey.” Each of these marks was used by EA in the video game.
The district court recently denied EA’s motion to dismiss Textron’s counterclaims. Electronic Arts, Inc. v. Textron, Inc., No. C 12-0018 (N.D. Cal. July 25, 2012) (Textron).
EA argued that the First Amendment guarantee of free speech allowed it to use the helicopter trademarks and trade dress under what is known as the Rogers test. This test was first set out in the Second Circuit U.S. Court of Appeals decision Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989). The test allows a party to use a trademark in an expressive work (e.g., a film, a book, a video game) without violating trademark rights unless the use “has no artistic relevance to the underlying work whatsoever, or, if it has some artistic relevance, unless [it] explicitly misleads as to the source or the content of the work.” Textron, Slip Op. at 4 quoting Rogers at 999. The district court found that EA failed to qualify for the second prong of the Rogerstest.
The court explained that this second prong, which determines whether the use of the marks explicitly misleads consumers as to the source or content of the work, is an outgrowth of trademark law’s purpose: “to avoid confusion in the marketplace by allowing a trademark owner to prevent others from duping consumers into buying a product they mistakenly believe is sponsored by the trademark owner.” Id. at 5. Textron argued that consumers were likely to believe that Textron sponsored or endorsed the new EA game since EA used the trademarked helicopters prominently in the video game (even allowing players to “fly” the machines while “sitting” in the cockpit) and in advertisements for “Battlefield 3” as an enticement for consumers to buy the game.
The court noted that in an earlier Ninth Circuit decision, E.S.S. Entertainment 2000, Inc. v. Rock Star Videos, Inc., 547 F.3d 1095 (9th Cir. 2008), the appellate court had concluded that the defendant’s use of “Pig Pen”, a variation of the plaintiff’s strip club trademark, “Play Pen”, for a virtual strip-club in a video game was presented primarily only in background and was incidental to the game so that consumers would not reasonably believe that ESS had produced the game. Here, the trial court noted, it is “plausible” that consumers might believe that Textron provided EA with expertise and knowledge “in order to create its realistic simulation of the actual workings of the Bell-manufactured helicopters. The court added that the game player’s ability to control the helicopters’ moves during the game was also a major reason for the game’s success.
On a motion to dismiss, Textron only had to allege sufficient facts to support an inference that consumers might believe Textron was somehow a part of the design of the game, endorsed it or sponsored it. The court noted that Textron had done just that.
EA had argued that a disclaimer on the game packaging would avoid any consumer confusion. That disclaimer reads: “Depiction of any weapon or vehicle in this game does not indicate affiliation, sponsorship or endorsement by any weapon or vehicle manufacturer.” The court disagreed noting that a disclaimer “might not be seen by teenage users, for example, anxious to rip open the package and play in the game.” Id. at 7.
EA also argued that its use of the helicopter trademarks was a nominative fair use of the marks. The nominative fair use doctrine is available as a defense when someone uses a trademark and the mark is “the only word reasonably available to describe a particular thing”; that use does not imply sponsorship or endorsement by the trademark owner. Id. at 7 quoting New Kids on the Block v. News American Publishing Inc., 971 F.2d 302 (9th Cir. 1992) (New Kids). In the New Kids case, a newspaper ran a contest where readers could nominate their favorite member of that singing group. The appellate court set out a three-part test for determining whether the use of a trademark was a fair use: “(1) the product or service … must be one readily identifiable without use of the trademark; (2) only so much of the mark … may be used as is reasonably necessary to identify the product or service; and (3) the user must do nothing that would, in conjunction with the mark, suggest sponsorship or endorsement by the trademark holder.” New Kids at 308. The court in New Kids decided that a contest about readers’ favorite band member could not be held without referring to the name of the band; consequently, the use was a fair one and was not a use of the New Kids trademark as a trademark.
The Textron district court noted that nominative fair use was seldom decided on a motion to dismiss since the three-part test involves questions of fact (for a jury to decide) as well as law. The court added that the parties disputed several facts that were required to be determined under this test: whether the helicopters in the video game are identifiable without use of the trademarks; whether EA used more of the marks than necessary to identify the helicopters; and whether EA’s use of the helicopters suggested that Textron sponsored or endorsed the game.
Since Textron had argued that people familiar with video games assume that trademark owners have given their approval to the video game producer for use of the trademark, the district court was unwilling to end the litigation without further investigation into the facts.