Lawsuits against video game developers and publishers usually arise from copyright infringement, plagiarism, or, in some cases, wrongful death. Most of these lawsuits are settled out of court, but sometimes they go to trial—and the subsequent court decisions have affected the video game industry as a whole.
1. Pong // Magnavox Vs. Atari
In 1972, Atari’s electronic table tennis game Pong became a bonafide craze—and Ralph Baer, inventor of the Magnavox Odyssey gaming console, sought legal action against Atari. Baer claimed that Atari co-founder Nolan Bushnell had copied Magnavox’s version of electronic Ping-Pong after Bushnell played the game at a Magnavox dealership demo a few months before Pong was released.
Bushnell settled the lawsuit out of court in 1976, despite his lawyer’s advice to take it to trial. Atari’s legal costs would’ve exceeded their entire funds, which is why Bushnell settled. As part of the settlement, Atari continued to sell Pong to arcades and on home consoles while paying licensing and royalty fees to Magnavox.
2. Pac-Man and K.C. Munchkin // Atari Vs. Philips
In the early 1980s, Pac-Man was the most popular video game in the world, and its manufacturers, Namco and Midway, were developing a home version port of it for the Atari 2600. But a year before Atari’s release, Magnavox and Philips Electronics debuted the video game K.C. Munchkin, which resembled Pac-Man’s gameplay, for the Philips Videopac home console. While K.C. Munchkin was not a direct clone of Pac-Man, its winding levels and its ghost-like monsters bore an uncanny resemblance to the Atari game.
In 1982, Atari sued Philips for copyright infringement and an appellate court found that Philips had copied Pac-Man. The Court’s ruling was the first to recognize how copyright law would apply to the look and feel of computer software.
Later in the year, Atari released the homeport of Pac-Man. Despite selling 7 million copies and being the best-selling video game at the time, critics panned it for its terrible gameplay and graphics, and large quantities of Pac-Man were returned to retailers.
3. Donkey Kong // Universal City Studios Vs. Nintendo
Universal Studios filed a lawsuit against Nintendo for copyright infringement in 1982, claiming video game creator Shigeru Miyamoto had based Donkey Kong’s story and characters on King Kong, the movie studio’s intellectual property. Nintendo fought the lawsuit and claimed that King Kong was in the public domain after it was revealed that Universal sued RKO—the movie studio that made the original 1933 film—over King Kong’s film rights. At the time, Universal also claimed that King Kong was in the public domain when they made the remake in 1976.
A few years after Universal filed the lawsuit, the United States District Court sided with Nintendo that King Kong was, in fact, in the public domain and Donkey Kong did not violate any copyrights that Universal did not own. Nintendo was awarded $1.8 million from Universal, which was a big win for the then-small video game company.
4. Unlicensed Nintendo Games // Nintendo Vs. Tengen
At the height of the Nintendo Entertainment System’s popularity in the late 1980s, Nintendo had very strict license agreements with third-party developers to only release five games per year, and that these titles would be exclusive to Nintendo for two years. Nintendo argued that this ensured high quality for consumers and they would put the “Official Nintendo Seal of Quality” sticker on each game.
In 1987, the Atari Corporation split into two divisions—Atari Games and Tengen—and tried to negotiate a less restrictive license with Nintendo, but the company refused. Tengen turned to the United States Copyright Office to acquire designs of Nintendo’s “lock-out” chip to reverse engineer and bypass it so they could sell as many unlicensed video games for the NES as they wanted. As soon as Nintendo got wind of Tengen’s actions, they sued the company for copyright and patent infringement. The U.S. courts sided with Nintendo, and Tengen settled the lawsuit out of court.
5. Mortal Kombat // Wilson Vs. Midway Games
In 1997, a 13-year-old boy named Noah Wilson passed away after his best friend stabbed him in the chest with a kitchen knife, severing his aorta. Noah’s mother sued Midway Games, makers of Mortal Kombat, claiming her son’s best friend was addicted and obsessed with the fighting game and that he believed he was the character Cyrax, a robotic ninja. The court held that Midway Games was not liable for the death under the First Amendment, as the State of Connecticut could not violate their free speech rights to make video games.
6. Mary-Kate and Ashley in ACTION! // The Olsen Twins Vs. Acclaim
In 2004, twin celebrities Mary-Kate and Ashley Olsen sued video game publisher Acclaim over $177,966.32 in back royalties after their company Dualstar Entertainment split from Acclaim a year earlier. Acclaim was to pay back royalties plus "maximum interest" and an additional $300,000 over the cancelation of the title Mary-Kate and Ashley in ACTION! for the GameCube, Game Boy Advance, PlayStation 2, and PC in 2003.
A letter from the Olsen twin’s lawyer to Acclaim asserted that the video game publisher “blatantly abandoned the Mary-Kate and Ashley brand and has taken the Mary-Kate and Ashley brand in video games which had flourished and has now run it into the ground."
7. Grand Theft Auto // Strickland Vs. Sony
In 2005, attorney Jack Thompson filed a lawsuit against Sony Corporation of America for the wrongful deaths of police officers Arnold Strickland and James Crump and dispatcher Leslie Mealer. Devin Moore shot and killed all three victims after grabbing an officer's gun while being detained for car theft. Thompson claimed that Sony and Rockstar Games’ Grand Theft Auto: Vice City was to blame for the deaths because Moore was trying to recreate scenes from the controversial video game.
The Alabama Supreme Court dismissed the lawsuit under Sony and Rockstar’s First Amendment rights.
8. New Super Mario Bros Wii // Nintendo Vs. Burt
A 24-year-old Australian man named James Burt was ordered to pay Nintendo $1.5 million after he bought an early release of New Super Mario Bros Wii and illegally uploaded the game to the Internet. The file was downloaded more than 50,000 times over the course of five days before it was to be released in November 2009. The copying and distribution of video games without permission is a violation of the Copyright Act under Australian law. Nintendo and Burt came to an out-of-court settlement agreement that reflected the video game company’s loss of revenue for a full week of sales. Burt had to pay an additional $100,000 to Nintendo for the company’s legal bills and court costs.
Although Nintendo sued Burt, the company gave him a very exclusive gift: A limited edition Legend of Zelda: The Wind Waker HD Ganon statue in 2013. The Ocarina of Time heals all wounds.
9. Guitar Hero // The Romantics Vs. Activision
Rock band The Romantics filed a lawsuit against Activision over the use of their song “What I Like About You” in Guitar Hero Encore, Rocks the 80s in 2007. Despite giving Activision written permission to use a cover version of the song, the Detroit-based band claims that the song used in the video game sounded too much like their original. A Detroit federal judge sided with Activision under the license agreement the company had acquired from the rock band.
10. Lineage II // Smallwood Vs. NCsoft
In 2010, a Hawaiian man named Craig Smallwood filed a lawsuit against the South Korean company NCsoft for making massively multiplayer online game (MMO) Lineage II too addictive. From 2004 to 2009, Smallwood invested more than 20,000 hours playing the game and averaged about 11 hours of gameplay a day. He claimed he became psychologically dependent and addicted to Lineage II and was “unable to function independently in usual daily activities such as getting up, getting dressed, bathing or communicating with family and friends.”
The lawsuit continued to hold NCsoft liable because the company failed to provide any warning that the MMO was so addictive. In 2011, Smallwood filed a motion to seal the lawsuit.
11. NCAA Football 2014 // O’Bannon and Keller Vs. Electronic Arts
EA Sports/NY Times
In 2009, former collegiate athletes Ed O’Bannon and Sam Keller filed a lawsuit against Electronic Arts and the Collegiate Licensing Company under the claim that they were not paid royalties for their likeness rights for the NCAA Basketball and Football video game series from E.A. The pair settled out of court with Electronic Arts for an undisclosed sum in 2013, while the company announced that they would no longer sell NCAA Football 2014, putting the franchise’s future in limbo.