Don’t Tase Me, Linden Labs
Posted by Gwyddia on April 22, 2009Kotaku reported today that Taser International, Inc has sued Second Life parent company Linden Labs for damages in excess of $75,000.
The suit was filed in the United States District Court for the District of Arizona, and names not only Linden as a corporation but some Linden employees past and present. The Complaint makes several allegations involving trademark infringement under both federal and Arizona common law, unfair competition, design patent infringement, and, most puzzlingly, RICO violations.
Taser argues that the existence of Taser and Taser-related items in Second life is causing people to associate the device with “prurient content”, such as pornography. Apparently some Second Life users have developed Taser replicas in-game. None of these digital devices actually function as an electric takedown device. Other users have developed different Second Life props that use the name “TASER” but bear no resemblance or similar functionality to the original Taser device. Because these users have Tasers in Second Life, and because Second Life has available a copious amount of material that some individuals would find offensive, Taser is alleging that the appearance of “Tasers” in the game is tarnishing the sterling reputation of their otherwise unblemished product. Taser appears to draw most of their evidence for this from a group of role-players who do a heavy trade in e-Tasers under the group name The Crack Den. The Complaint draws little or no distinction between these users and Linden itself, however, which may be a bridge too far for a federal court.
Taser’s case has some structural issues, too, mainly pertaining to the proper naming of proper defendants. First, Linden no longer brokers item transactions between users. They recently acquired XStreet to do that for them. XStreet is not currently named as a Defendant in the case, but as they are a wholly-owned subsidiary of Linden, Linden would have to show a remarkable degree of corporate separation to divest themselves of responsibility in the matter. If Taser gets their act together and amends their Complaint, Linden could be open to some liability on this front.
Next, Taser that they don’t even seem to have named Linden properly. Taser has named both Linden Lab and Linden Research Inc., even though one is a DBA of the other. In addition, Taser, a Delaware corporation, states in their Complaint that Linden is “an entity of unknown origin”. Linden makes no secret that they, too are a Delaware corporation.
Taser is reaching here, and not just legally. They are claiming damages in excess of $75,000 to get over the federal minimum. In addition, under Arizona Revised Statutes Taser can be granted US$500 per infringing copy for every non-functional. Each Second Life Taser only “retails” for about $2 US. That’s a long way to go for a bunch of pixels.
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Why is naming a parent of a wholly-owned subsidiary a defect? The subsidiary always acts under the complete direction and control of it’s parent. (See, e.g., Copperweld v. Independence Tube). Linden can’t at all distance itself from the actions of XStreet.
And so what if I’ve named a defendant under both it’s real and dba names? Either way, I’m talking about the exact same defendant.
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I would name the parent and the subsidiary, not one or the other. I think Linden might be able to distance itself, or they might not, but it has to be properly alleged and proven. A properly-written pleading would incorporate both. As far as naming the Defendant under both their real and DBA names, I suppose its a stylistic and jurisdictional issue. In one state where I am licensed, they’d bounce it for that.
How can a parent ever distance itself from it’s wholly-owned subsidiary? It wholly directs and controls the actions of it’s subsidiary. The subsidiary has no independent decision-making ability of it’s own. Everything move it makes, every step it takes, is 100% attributable to the parent. They’re bound to each other like Siamese twins. On what possible basis could the parent reasonably argue otherwise?
I haven’t read the Complaint, but I assume the caption lists both the real and dba entities as two separate entities (otherwise this wouldn’t even be an issue). First, as soon as the first responsive pleadings are filed, Plaintiff — unless they’re absolutely brain dead — will figure out their mistake, if for no other reason than the fact that they haven’t received a pleading from one or the other of the real and dba entities. They move to dismiss with prejudice the dba entity — which is usually how a plaintiff gets rid of an unwanted named defendant. No opposition, motion granted. Problem fixed, no need to amend their Complaint. Second, what one State would do as opposed to another State, don’t matter. Plaintiff is in federal court where the FRCP controls and applies with equal forces across all States. Whether State A or State B don’t make no difference.
According to New World Notes, in response to request by the Lindens, the weapons formerly called “TASERs” on Second Life have now been renamed “stun-guns.”
Despite over 9000 attempts by journalists to claim otherwise, there is still only one Linden Lab.
I would like to know how they plan to sue Linden Labs, LL has not created these items, neither do they sell them. All they do is facilitate the transfer of goods between 3rd parties via their Asset Servers. I suppose that they could be sued for holding the items in their database but how can they put such a value to a modified set of virtual objects with various user created scripts embedded within that cause a virtual avatar to animate that they have been hit with a large electric charge. maybe the makers of police handcuffs should sue as well because there are plenty of them in the virtual world.
@Makoto:
Under the Lanham Act, despite the fact that a defendant did not engage in conduct which directly infringes upon the rights of a trademark holder, if they knowingly engaged in conduct which materially contributes to (i.e., facilitates) the direct infringement of the trademark by another, they’re on the hook, too.
And if there is a real world handcuff product trademarked as “Silver Braclets” and a virtual seller chooses to call their virtual world handcuff product Silver Bracelets, then the trademark holder has every right to take legal action. The virtual seller can call their handcuff product anything they want — other than “Silver Braclets” or any other registered trademark.
And let’s just throw this in. It’s only been recently that Linden Labs actually accquired SL street.
It’s very possible they could blame the previous owners. (it’s been a matter of a few months here. Which makes me scratch my head on the timing.
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