Note: this article was first published on Shoryuken.com in April 2011. Unfortunately, it was wiped out when Shoryuken underwent a complete overhaul. I'm reposting it here without edits!
As I'm sure you've all heard by now, somehow the code to unlock Evil Ryu and Oni in Super Street Fighter IV: Arcade Edition was leaked. Almost immediately after arcades began unlocking them in the United States on Saturday, YouTube and streaming sites were flooded with footage of the two characters. Sunday night, Capcom requested that YouTube take down almost all of that footage. Lots of people have asked me what I thought about this and what the legal issues surrounding it are, so consider this big writeup a response to all of you. I'm gonna try to keep it short (yes, this is short), conversational, light on the jargon, and not nearly as in-depth as a real analysis would be, but something tells me most of you will be a-ok with that.
First off, yes, I'm a lawyer. In fact, I'm a lawyer with a private video game law practice whose clients have included video game developers and video game media companies and whose work has involved notice and take down procedures in the past. I've written academically about copyright law and the internet and dedicated an entire paper to a direct discussion of the legal issues behind fighting game match videos online. I have two law degrees, each from top tier institutions and each geared toward entertainment, copyright, and internet law. I have earned the respect of some of the most respected copyright professors in the world. And as you might know, I also upload my own fighting game videos, both traditional recorded match videos and more complex match analysis videos. All of this isn't just to brag but to say that as far as qualifications to discuss this kind of thing go, mine aren't half bad. I should note before continuing that my expertise is largely limited to US copyright law, so if you're from somewhere else and something I say sounds screwy, that's probably why.
Let's start with the most basic stuff. Video games are copyrighted works, and they're copyrighted in two ways. The first is as to the code that underlies them, since computer code is considered copyrightable as a literary work. The second way games are copyrightable is as to their audiovisual works, that is the sights and sounds that games produce. Although there were lots of interesting early challenges to copyrightability in video game audiovisual works, and although I think there are lots of very interesting unexplored questions for copyrightability in more complex modern games, the fact is that the law settled early and easily on video game audiovisual works being copyrightable. The law tends to treat video game audiovisual works the same way it treats film and television audiovisual works.
Copyrights come with a set of exclusive rights available only to the copyright holder, including the exclusive rights to reproduce, distribute, modify, and publicly perform or display the work. The copyright holder can allow anyone he wants to do those things, but if he doesn't give consent, he can prevent everyone else from doing all those things under most circumstances. Exclusivity of reproduction means that no one else can copy the copyrighted work without the copyright holder's consent. Exclusivity of distribution means that only the holder can distribute the work, including uploading works online, sending works to other people, and so on. The modification right allows a copyright holder to prevent anyone else from changing the work or making a derivative work without consent. Lastly, the public performance and display right means that a copyright holder can prevent his work from being shown in public situations without his consent. I wrote a 40 page paper on this once, but to keep things short, a work can be performed publicly both in person, if you're with enough people outside your normal circle, and also online, in both recorded and live streaming videos that are accessible by members of the public. In other words, public tournaments, YouTube videos, and Justin.tv streams are all public performances of copyrighted video game audiovisual works, and if you don't have the rights holders' permission, then you might be infringing.
Obviously the internet has been a huge challenge for traditional copyright law in a ton of ways. One of the ways is that it's now very difficult and onerous for copyright holders to find and sue infringers who upload or publicly perform copyrighted works online. A partial result of this was part of the Digital Millennium Copyright Act (DMCA). The DMCA allows for a notice and take down procedure whereby, to keep things short, a rights holder who sees that his work has been uploaded to a website can ask that website to take the work down instead of actually suing the individual uploader or the site. The site has to comply with some things for that to work, like it has to have a procedure in place for all that and it has to take things down when asked etc, and if it's in compliance then it has a safe harbor from being sued for infringement for accidentally hosting infringing works. This is actually a pretty complicated issue and Viacom sued YouTube/Google for a billion dollars over it, but let's just assume that YouTube is doing everything right, has a safe harbor, and will take videos down on request. They've been pretty straight by most accounts for quite a while at this point. It should be noted that copyright holders don't have to go this route; if you've infringed on their rights, they can still sue you instead.
Now I'm sure most of you have heard of fair use and are wondering where that fits in here. In general, the answer is that fair use isn't all that far-reaching. A use of a work is more likely to be fair if it's in things like news reporting, teaching, scholarship, criticism, comment, or parody, but even then you still have to look to four factors in determining whether a use is fair. The first factor is the purpose and character of a use; the more a use transforms the original, the more fair it is. The second is the nature of the copyrighted work; certain kinds of works, like audiovisual ones, are afforded more protection than others, and others, like computer code, are afforded less. The third is the amount and substantiality of the portion of the work used in relation to the size of the work as a whole, that is, the smaller percentage of a work you use, the more fair it probably is. And the last is the effect on the original work's potential market or the value of its copyright; the larger and more negative the effect, the less likely a use is to be fair. No single factor is dispositive, or in other words, no single factor proves or disproves fair use. How complex and vague is the fair use exception? I know the guy who literally writes the book on copyright, and I can't tell you how many times I asked him whether something was fair use only to get a shrug of his shoulders and a friendly debate.
Aaaaaaanyway. With all that in mind, let's take another look at what happened with Capcom requesting that YouTube take all those Evil and Oni match vids down.
Step 1: Does Capcom hold the copyrights in the audiovisual work in SSF4AE? You bet. Does that include the rights in the characters Evil and Oni? Of course.
Step 2: Do the match videos of SSF4AE showing Evil and Oni infringe on Capcom's rights? Some vids have clear, direct copies of SSF4AE's audiovisual work and most of them have understandable copies, so that's infringement on the reproduction right. They were all uploaded and sent around to a ton of people, aka busted on the distribution right as well. And because they were made available to the online viewing public, they probably also infringe on the public performance right. That's a lot of infringement right there!
Step 3: Can Capcom legally request take downs of the SSF4AE match videos showing Evil and Oni on YouTube? Well, they own the rights and their rights are being infringed, so... you betcha. And again, they don't have to limit themselves to take down requests. If you've infringed on their rights, they can still sue you.
Whether fair use can do much about most of this is doubtful. Run through the factors in your head. Are match vids with Evil and Oni news reports, or scholarly work, or teaching, or parodies? Nope. Do they have transformative purpose and character? Not really. Is the nature of the copyrighted work one that doesn't get much protection? No, in fact as an audiovisual work it's afforded a high level of protection. Is the amount and substantiality of the copyrighted work small? No, it's huge; virtually all of Oni and Evil's animations and sounds were recorded and put online, not to mention the character portraits, select screens, backgrounds, general sounds, etc that are all part of the larger SSF4AE work and that were shown in some videos for minutes at a time. And is the effect on the market for SSF4AE a small one or a beneficial one? Well, match vids of Evil and Oni probably helped generate short term interest in the game. But Capcom might have wanted to regenerate interest in the game at a later, more strategic date, and if the early release of these match vids could result in less interest in SSF4AE in the long haul, then that means that this last factor could be a negative for fair use as well.
That said, I do believe that some footage of Evil and Oni is fair use. For example, in a video I put up for Machinima Respawn (ding: http://www.youtube.com/watch?v=k_h7d5W6fKU), I was doing a recap of some news in fighting games that I wanted to cover more in-depth in the future. Although the video was actually uploaded Monday (4 hours before I realized it), I sent it in on Saturday just after Oni and Evil had been leaked and before there was any indication that Capcom would ask for take downs. I included about 22 seconds of the early footage Cicada took.
A fair use analysis here looks totally different. Yes, it is a news report. Is the purpose transformative? Yeah, in that it's being shown as interesting news and as a teaser of things I plan to break down in strategic depth in the future. The nature of the audiovisual work still goes against me, but again, no individual factor proves or disproves fair use. The amount and substantiality taken is small, just 22 seconds and only a few moves and screens, with no sounds at all, only visuals. The effect on the market for SSF4AE is also hardly negative; I still figure that it helps interest in the game in the short run, and in the long run 22 grainy seconds with no sound is hardly going to sate anyone's interest in the game such that they won't play it. So I'm pretty satisfied that my video would be considered fair use as to its inclusion of Evil and Oni. But my video is a very particular case.
Before I posted this, I was asked two more interesting questions. Are the arcades that unlocked Evil and Oni in trouble? And can Capcom prevent the unlock code from being passed around?
The answer to the first question depends on a couple of things. Sometimes when games are imported they're imported without the explicit permission of the company that made it, and that's against the rules. This is what happened for vanilla SF4 arcade machines, so it might be what's happening now in SSF4AE as well. If it is, then arcades are infringing on Capcom's rights just by having SSF4AE in the first place. That said, Capcom was nice enough to look the other way with SF4, and they'll probably do the same now as well. But let's assume that the arcade operators DO have a license... are they still in trouble? That's impossible to say without knowing what the license says, really. But if it says anything about being required to follow release dates for the hidden characters under penalty of something, and you can be sure it does, then yeah, they might be in trouble for breach of contract.
The answer to whether Capcom can prevent people who were already given the code from passing it around is a little murky without a lot more research and consideration than I have time for right now. Remember the DMCA? The DMCA also banned the making and distribution of so called anti-circumvention technology. If a work has a technological measure on it that effectively controls outside access to that work, like digital rights management (DRM) protection on a DVD, then you can't get around that measure without authorization and you can't distribute the technology to do so either. For example, when DVD encryption was broken, the program that broke it was found to be anti-circumvention technology. Not only was one of the guys who made it put on trial (in Norway), but some people who merely republished the code in a readable, non-active-program format were also sued. Just distributing that technology as a written code was enough to go against the law.
Now, is a lock on two characters in an already released video game an access control like the DVD encryption technology? Is an unlock code consisting of a short series of letters, numbers, and symbols that was already in existence and meant to be released eventually an anti-circumvention technology in the same way as an entire program created to hack through protection that was never meant to be broken? I doubt it, but it's hard to say how a court would really rule. If the lock isn't an access control or the code isn't an anti-circumvention technology, then I don't see how Capcom can prevent people who already have the code and who have no real connection to Capcom from giving it to others. Certainly the code itself is not copyrighted; it's too short and too purely functional for that to be an option. As to the person who first leaked the code, well, if Capcom knows who he is, I'm sure he's had better weekends.
CONCLUSION: Yep, Capcom can request take downs of the Evil and Oni SSF4AE match video footage on YouTube. A good fair use argument that some footage is okay can be made in very particular circumstances, but for the most part that option doesn't hold up. Uploading new match videos showing Evil and Oni would constitute more infringement and could also result in take downs or worse. It's hard to know whether arcades themselves are breaking any rules just by having Evil and Oni playable, but it seems likely that they are. It's also hard to know whether Capcom can legally prevent people from republishing the unlock code, but my guess is that they cannot.
But let me say this: the fact that you may be right in a copyright dispute does not mean that you cannot be sued. At the same time, just because you can be sued doesn't mean you will. In the past Capcom has been very good about not suing and in general not even requesting take downs over infringing behavior. Don't test them unnecessarily, but I wouldn't expect them to request take downs or start lawsuits over the many untold thousands of hours of infringing Capcom game footage hosted and streamed online.