I am not a lawyer, nor do I have any inclinations to become one. We do however, have an Intellectual Property Lawyer in our readership, who is able to dig through the judgement and summarize it for us. Hopefully this puts us a step closer in closing this lawsuit, but I personally fear it will be going for quite some time.

Here is the link to the decision for those lawyer types
http://digitalcommons.law.scu.edu/cgi/viewcontent.cgi?article=1200&context=historical

via J. Mike from the Faeit 212 inbox (thank you for taking the time to translate this stuff for us)
Here is a summary of the case and where it stands.  I've written it with a non-lawyer as the desired audience, since I didn't know whether you wanted this summary just for you or for the site. I've also attached a copy of the decision in the event you have trouble sleeping tonight. I’m an intellectual property lawyer by trade, so reading about stuff like this is fun for me.  Adding a GW angle into it made it even more fun. 

Many of you know Chapterhouse from the 40k bits and – later – the 40k tru-scale miniatures they offer.  See, http://www.chapterhousestudios.com/.    You may not know that GW sued them back in 2010 for – among other things – copyright and trademark infringement (which, it occurs to me, is maybe not the best way to treat your fan base but I digress).  A preliminary decision on the case came out in November of last year, and the decision was recently published.

Simply put, the case is now headed to trial, as the decision didn't grant either GW or Chapterhouse the relief they were looking for.  However, there were some interesting things to come out of the decision that could have an effect on Chapterhouse and the modeling side of the hobby generally, so I thought I’d run through those.

First, the court held that GW’s Space Marine shoulder pads, generally, are protect-able under copyright law, because they are disproportionately large and therefore contain the requisite amount of originality.  To mean, this suggests, that GW can probably stop other companies from molding/selling their own SM shoulder pads so long as they look enough like the GW pads.  Yes – the plain should pads with no markings.

Second, the court held that shoulder pads + chapter markings + specific color schemes are also protect-able under copyright law.  After having said the first thing, the court didn't really need to say the second (and one wonders if the court actually understands the hobby, as bits aren't sold pre-painted).

Third, while the court held that much of the GW iconography (space wolves, etc.) was copyrightable, it specifically singled out the Flesh Tearers icon as one that was not because it consisted solely of the combination of a tear drop and a circular saw blade which, in the court’s view, were common geometric shapes.  I think the court got this one wrong, because even combinations of common shapes, if put together in original combinations, are normally copyrightable.

What this means is that GW can probably stop other companies from making iconography bits by themselves that, for example, you could melt and mold to shoulder pads, unless it is a Flesh Tearer bit.  Sorry if anyone has been building a Flesh Tearer army.

Finally, the court declined to side with Chapterhouse on its claim that its use of GW trademarks (like Warhammer 40k, Space Marine, etc.) in its marketing materials was a “fair use.”  To explain – a merchant has the right to refer to someone’s trademarks if it is only using them to explain to consumers that its products are compatible, or designed to be used with, the trademark owner’s genuine products.  This came up because GW complained that the Chapterhouse site included product descriptions such as “Conversion Kit for Tyranid Tervigon.”  In my view, this is a classic example of trademark fair use, and the court got this one wrong too.  The only thing Chapterhouse could have done better was say something like “Conversion Kit for the Tyranid Tervigon model,” and a court will almost never compel someone to do this because the difference is so subtle.

Really what this court is saying is that GW might be able to have more of a monopoly on its trademarks that it should otherwise be entitled to under the law – provided the facts during trial come out the right way.  If Chapterhouse has any money left at this point, I think they could appeal at least this part of the decision and win.  It will be interesting to see how far GW decides to take this.  If I were advising them, I would recommend that they embrace their fan community much more in the way Lucas did with the SW fanbase and instead spend their legal budget fixing finecast.  But that’s just one lawyer’s opinion.

22 Comments:

  1. I want to point out that CHS filled a motion to reconcider the shoulder pad decision. This comes after the Copyright Office said they would not register the shoulder pads and GW withheld that information deliberately from the court. One could even argue that they lied to the court about that issue.

    In addition a lot of things on the copy right list got thrown out of court. GW has since added more things to the litigation. Originally they tried to file a second law suit, but the court refused to accept it, and instead added it to the first law suit.

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  2. This almost makes me want to donate to CHS just to see how this court room drama ends.

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  3. Chapter house is being represented pro bono, so as long as the firm that is representing them wants to keep it going, it is pretty much free for chapterhouse.

    I believe many lawyers do have a certain number of pro bono hours that they do each year, so the firm may just keep going with it.

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  4. I can tell you that it would be rare to take a case like this Pro Bono, as our annual pro bono hours would be run through in a matter of days in a complex litigation. How do you know this is pro bono?
    -J.Mike

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    1. This comment has been removed by the author.

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    2. From Chapterhouse Studios, as posted on DakkaDakka:

      My company, Chapterhouse Studios LLC, has been very fortunate to locate pro-bono council with the help and tips of a few of our customers. Those customers have intensive legal background as well as leads that helped us find a firm that believes in our case enough to support us.

      Thanks to some friends good advice and experience we have a legal agreement for Winston & Strawn LLP - http://winstonandstrawn.com/ to represent us in our case.

      I consider myself very lucky to have three attorneys from the firm willing to be our representatives during the case and any other negotiations with Games Workshop. The lead on the case Jennifer Golinveaux has some major experience behind her, and I am confident that with her teams' help we will come out of this experience in great shape.

      For everyone who has given their support, I really do appreciate it. I will do my best to let everyone know what happens (as much as is ok with the attorneys).

      For those who swore up and down that GW was going to shut us down, bury us in legal fees and we had no chance to win since we were obviously in the wrong... I think the attorneys thought this was a slam-dunk case for Games Workshop and we had no legal ground to stand on that there would be little chance for us to find such an outstanding firm to help us.

      Sincerely,
      Nick Villacci
      Chapterhouse Studios LLC

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    3. J. Mike. If you are going to comment on the case, you should probably know a little bit about it first. Your analysis of the opinion is misleading, and numerous available documents identify that CHS counsel is working pro-bono. In fact, GW's motion in limine specifically request to limine out information regarding the billing arrangements between the parties and counsel.

      Doc 250 yo:

      "14.The Parties Should Be Precluded from Mentioning or Referring to Either Party’s
      Billing Arrangements With Its Lawyers .
      The Parties should be prohibited from offering any statement, reference or criticism of
      how the Parties employed their attorneys, including how or whether the Parties’ are represented
      on a pro bono or cash fee basis, or who is paying any litigation expenses. Such matters are not
      irrelevant and would be raised solely to unfairly prejudice the Parties’ position without any
      probative value. Fed. R. Evid. 402, 403. Games Workshop has taken no discovery on the issue
      of Chapterhouse’s billing arrangements, notwithstanding that it has spent lavishly on videotaping
      depositions, flying attorneys around the world for depositions when Games Workshop has
      simply used telephone or video links; has hired a jury consultant and has employed teams of
      lawyers as against the two lawyers employed by Games Workshop. The legal fees and expenses
      incurred are not relevant to any issues for the jury’s consideration, and would serve to unduly
      prejudice Plaintiff, mislead the jury, and waste time."

      So, you know, do a little looking into things.

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    4. I'm not a lawyer, but does your comment basically say that GW are saving money on this case, as opposed to CHS using a whole team of lawyers, and flying all over the place when a video call would be sufficient.

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    5. My comment isn't saying anything other than that the author does not have all of his facts.

      GW's lead counsel, Jonathan Moskin, appears to be saying in his motion to the court that counsel for CHS has been "lavishly" outspending GW. I am not sure what his point is. How opposing counsel decides to vigorously defend a client is not really any concern for the Court.

      Mr. Moskin has used this tactic before in a lawsuit in which he and his firm were sanctioned to the tune of $10,000.00 for legal fees associated with having to file repeated motions to compel discovery, plus another $1,000 to Mr. Moskin personally for wrongly interjecting the notion that the case would be dismissed with prejudice instead of without prejudice (he deliberately misled). The case was E&J Gallo Winery v Cantine Rallo out in California when Moskin was with White and Case (where he was chair of the firm's copyright/trademark group). http://www.gpo.gov/fdsys/pkg/USCOURTS-caed-1_04-cv-05153/pdf/USCOURTS-caed-1_04-cv-05153-31.pdf

      This is one representative example from that case:

      Document 294 page 6 line 6 (http://archive.recapthelaw.org/caed/18121/ )“Although E&J Gallo has wasted no effort in this case chastising Cantine Rallo and trying to paint it black, the fact is the company has expended extraordinary efforts responding to needlessly complicated and seemingly irrelevant discovery requests, and virtually every discovery motion made by E&J Gallo (if not indeed every such motion) was made only after the parties had seemingly resolved their disputes by stipulation. Indeed, because of the enormous costs of responding to such motions, Cantine Rallo felt it had little choice but to accede to E&J Gallo’s requests rather than fight them.”

      That was written by Mr. Moskin in the case, and note that it was his client that was sanctioned for requiring the plaintiff to file repeated motions to compel discovery, rather than the other way around. That is, the Court made his client pay the Plaintiff for the cots associated with having to repeatedly ask the Court to force the opposing party (Moskin's client) to produce something that they are required to produce.

      That case was wrapped up in June of 2007. Moskin went over to Foley and Lardner about 2 years later (http://www.law360.com/articles/117439/ip-expert-leaps-from-white-case-to-foley). He is not chair of anything at Foley, so draw your own conclusions. (http://www.foley.com/jonathan-e-moskin/)

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    6. I'm confused, what does this have to do with Gonky's comment? Its addressed to the source in the OP?

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    7. jeez dude - sorry I didn't have time to read the entire docket and/or read it at least up to Doc. #250. probably should have waited until the weekend to write this up.

      that said, I don't really think my analysis was misleading, albeit summarized at a high level to keep things simple. happy to discuss what you think is misleading though.
      -J.Mike

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    8. You don't have to read the docket Gonky. Several threads on various forums have kept very good track of the case, and in fact at the time the Court's MSJ opinion was actually entered, BOLS put up a post that gave a brief summary and pulled out relevant quotes, which in its brevity managed to be more informative, and more timely, than this article.

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    9. dude seriously? you need a hug.

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  5. As a 2L here in the state of WA I find this very fascinating (although I am not studying IP or copyright). Being in my second year of law school, taking bankruptcy and corporate law, it is astonishing how often the court gets their decisions wrong, almost entirely contradictory to stare decisis(legal precedent).

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    1. Here is a link to the discussion of the case on DakkaDakka. There are several IP lawyers in the thread that provide acurate layman translations to those following the case. If you decide to comment, please keep the thread on topic, as the moderators REALLY dislike off-topic conversations. In addition, please keep in mind that there are several hundred folks (myself included) that are following the thread with e-mail notifications.

      http://www.dakkadakka.com/dakkaforum/posts/list/355433.page

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  6. Basically it says chapterhouse are getting a good hiding from gw for being naughty.

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    1. Not really. It is more of "Win some, Loose some" situation. Keep in mind that nothing is final at this point. The things GW "won" will go to trial, the things they "lost" can most likely be appealed. The same goes for Chapterhouse Studios.

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  7. As long as chapterhouse looses the right to rip off Gw's works whilst labelling it as their own then it's all fine with me.

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  8. Disney bought Lucas! -.-
    Not the Way GW should go

    CH didn't just refrence GW
    They called it Tervigon Kit!
    Not XYZ Kit for a Tervigon
    Its like calling youre Tires "Mercedes Tire"
    Its a Bit of a diffrence Thats missleading

    CH got what they asked for IMO

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  9. Regarding the use of trademark names, Chapterhouse could have done like the rest of the companies and just advertise their products as "compatible with 28mm heroic scale wargaming figures", stating how their PAULDRONS are for use with "Space Knights", gribbly appendages for use with "Space Monsters", etc.

    Doubt that unmarked PAULDRONS will have a required degree of originality that would stand in court proper, though. After all, LEGO has been quite unable to prevent a deluge of knock-off manufacturers (MegaBloks, Kre-O, BanBao) selling "compatible minibricks" which have the distinctive studded shape of a LEGO brick, but do not claim to be the real thing - in those cases, the shape of the bricks has been repeatedly judged to have been merely functional, and not original enough to warrant a copyright.

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