Tetris Holding, LLC v. XIO Interactive, Inc.

863 F.Supp.2d 394

103 U.S.P.Q.2d 1959

TETRIS HOLDING, LLC and The Tetris Company, LLC, Plaintiffs,

v.XIO INTERACTIVE, INC., Defendant.

Civil Action No. 09–6115.

United States District Court, D. New Jersey.

May 30, 2012.

Dale M. Cendali, Johanna Schmitt, Brendan T. Kehoe, Kirkland & Ellis LLP, New York, NY, Robert J. Schoenberg, Riker Danzig Scherer Hyland & Perretti LLP, Morristown, NJ, for Plaintiffs.

Donald A. Robinson, Robinson, Wettre, & Miller LLC, Newark, NJ, Mark A. Lemley, Joseph C. Gratz, Sonali D. Maitra, Durie Tangri LLP, San Francisco, CA, for Defendant.

OPINION

FREDA L. WOLFSON, District Judge:

Presently before the Court are cross-motions for summary judgment. Plaintiffs Tetris Holding, LLC and the Tetris Company, LLC (collectively “Tetris Holding” or “Plaintiffs”) claim that Defendant Xio Interactive, Inc. (“Xio” or “Defendant”) has infringed the copyright and trade-dress of Plaintiffs' video game Tetris. Xio does not raise any issue of fact in response, but makes a purely legal argument that because it meticulously copied only non-protected elements, in particular the rules and functionality of the game, and not its expressive elements, that judgment should be entered in its favor. The motions stem from Tetris Holding's First Amended Complaint that alleges (1) Xio infringed Tetris Holding's copyright under 17 U.S.C. §§ 101 et seq. (Count One); (2) Xio's actions constituted unfair competition, false endorsement, and false designation of origin under 15 U.S.C. § 1125(a)(1)(A), including infringing Tetris Holding's trade dress (Count Two); (3) Trade Dress Infringement and Unfair Competition under the New Jersey Fair Trade Act (Count Three); (4) Xio's actions constituted common law unfair competition (Count Four); and (5) Xio was unjustly enriched by its actions at Tetris Holding's expense (Count Five).¹ Although the parties frame their motions as seeking summary judgment as to all claims, only Counts One and Two, the federal causes of action, are addressed in full by their briefs. It may very well be that the remaining counts flow from the issues disposed of today, but the Court will not sua sponte grant summary judgment on these causes of action without the parties addressing the remaining counts. Therefore, I will treat the motions as seeking summary judgment only as to Counts One and Two.

For the reasons that follow, Plaintiffs' motion is granted and Defendant's motion is denied.

I. BACKGROUND

The Court only recounts the facts necessary to resolve the parties' motions. The following facts are undisputed by the parties. The game of Tetris gained fame in the United States during the late 1980s and early 1990s as an electronic video game initially played on Nintendo's portable platform, the Gameboy, and on its console systems. Since that time, Tetris Holding has developed many versions for modern platforms.

Tetris is a facially simple puzzle game in which the player is tasked with creating complete horizontal lines along the bottom of the playing field by fitting several types of geometric block pieces (called tetrominos) together. The game becomes more complex and more difficult as you progress and are left with fewer options to arrange the pieces and less area of the playing field is available. Originally developed in Russia during the mid–1980s by Russian computer programmer Alexy Pajitnov, Tetris was exported to the United States and has since been adapted for the myriad electronic video game platforms available to consumers, including Apple Inc.'s iPhone. Pajitnov formed Tetris Holding, LLC, along with game designer, Henk Rogers. Tetris Holding, LLC owns the copyrights to the visual expression of the numerous Tetris iterations and licenses those rights to Tetris Company, LLC, which then sublicenses its rights. Companies have licensed Tetris Holding's intellectual property rights for a number of reasons. For example, Tetris Holding licensed the visual look of Tetris: (1) to Hallmark so it could design a Tetris-themed greeting card, (2) to states, such as New Jersey and Idaho, to create Tetris-themed lottery cards; and (3) to various television shows to use and reference Tetris in episodes. In the years since its development, Tetris has won numerous awards and accolades, and has been ranked high on several lists as one of the greatest video games of all time. It has sold over 200 million units worldwide. And Tetris continues to enjoy success through smart phones and social networking, with billions of games of Tetris being downloaded and played online.

Tetris Holding's success has also bred many unauthorized attempts at imitation. In response, Tetris has vigorously made a concerted effort to protect its intellectual property by pursuing such infringers through the legal process and removing hundreds of imitation games from the market. Tetris Holding alleges that Xio is one such company that has infringed its intellectual property, namely its copyrights and its trade dress, trading off the creative aspects of its work without authority.

Xio was formed by Desiree Golden, a recent college graduate, who decided to create a multiplayer puzzle game for the iPhone called “ Mino ” and admittedly used Tetris as inspiration.² Indeed, Xio was more than inspired by Tetris as Xio readily admits that its game was copied from Tetris and was intended to be its version of Tetris. Plaintiffs point to Ms. Golden's statements that she was “trying to get a company started to make a MultiPlayer game similar to Tetris for the iPhone;” that some iPhone games “made by private developers have made 250K each in 2 months!;” and that Xio's game would “absolutely succeed” because “The concept is popular—everyone knows about it.” Pl. Stmt. Of Undisputed Fact, ¶ 105. Plaintiffs also point to admissions by Xio's principals that Xio downloaded Tetris's iPhone application for the purpose of developing its own version and used it in the development of Mino. Id. ¶ 121–125. Xio does not dispute any of these facts. Yet, Xio says, it copied Tetris in such a way so as to not copy any protected elements after diligently researching intellectual property law, and that it also tried to obtain a license from Tetris Holding, but was refused.

Xio released Mino version 1.0 in May 2009, Mino version 1.1 in July 2009, and Mino Lite shortly thereafter.³ Tetris Holding became aware of Mino and Mino Lite and in August 2009, sent take-down notices pursuant to the Digital Millennium Copyright Act to Apple, Inc., which removed Mino and Mino Lite from its online apps marketplace. Xio's counsel sent two counter-notifications soon after and Apple, Inc. informed Tetris Holding that the games would be reinstated unless Tetris Holding filed a lawsuit. This litigation was then commenced in December 2009.

Tetris Holding argues that Mino infringed the following copyrightable elements:

1. Seven Tetrimino playing pieces made up of four equally-sized square joined at their sides;

2. The visual delineation of individual blocks that comprise each Tetrimino piece and the display of their borders;

3. The bright, distinct colors used for each of the Tetrimino pieces; 4. A tall, rectangular playfield (or matrix), 10 blocks wide and 20 blocks tall;

5. The appearance of Tetriminos moving from the top of the playfield to its bottom;

6. The way the Tetrimino pieces appear to move and rotate in the playfield;

7. The small display near the playfield that shows the next playing piece to appear in the playfield;

8. The particular starting orientation of the Tetriminos, both at the top of the screen and as shown in the “next piece” display;

9. The display of a “shadow” piece beneath the Tetriminos as they fall;

10. The color change when the Tetriminos enter lock-down mode;

11. When a horizontal line fills across the playfield with blocks, the line disappears, and the remaining pieces appear to consolidate downward;

12. The appearance of individual blocks automatically filling in the playfield from the bottom to the top when the game is over;

13. The display of “garbage lines” with at least one missing block in random order; and

14. The screen layout in multiplayer versions with the player's matrix appearing most prominently on the screen and the opponents' matrixes appearing smaller than the player's matrix and to the side of the player's matrix.

Pl. Motion, at 17.

II. LEGAL STANDARD

“Summary judgment is proper if there is no genuine issue of material fact and if, viewing the facts in the light most favorable to the non-moving party, the moving party is entitled to judgment as a matter of law.” Pearson v. Component Tech. Corp., 247 F.3d 471, 482 n. 1 (3d Cir.2001) ( citing Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986)); accordFed.R.Civ.P. 56(c). For an issue to be genuine, there must be “a sufficient evidentiary basis on which a reasonable jury could find for the non-moving party.” Kaucher v. County of Bucks, 455 F.3d 418, 423 (3d Cir.2006); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). In determining whether a genuine issue of material fact exists, the court must view the facts and all reasonable inferences drawn from those facts in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986); Curley v. Klem, 298 F.3d 271, 276–77 (3d Cir.2002). For a fact to be material, it must have the ability to “affect the outcome of the suit under governing law.” Kaucher, 455 F.3d at 423. Disputes over irrelevant or unnecessary facts will not preclude a grant of summary judgment.

Initially, the moving party has the burden of demonstrating the absence of a genuine issue of material fact. Celotex Corp., 477 U.S. at 323, 106 S.Ct. 2548. Once the moving party has met this burden, the nonmoving party must identify, by affidavits or otherwise, specific facts showing that there is a genuine issue for...