Incredible Tech v. Virtual Tech Inc ( 2005 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 03-3785
INCREDIBLE TECHNOLOGIES, INC.,
Plaintiff-Appellant,
v.
VIRTUAL TECHNOLOGIES, INC. d/b/a GLOBAL VR,
Defendant-Appellee.
____________
Appeal from the United States District Court for
the Northern District of Illinois, Eastern Division.
No. 03 C 1183—Matthew F. Kennelly, Judge.
____________
ARGUED SEPTEMBER 13, 2004—DECIDED MARCH 15, 2005
____________
Before BAUER, RIPPLE, and EVANS, Circuit Judges.
EVANS, Circuit Judge. As anyone who plays it knows, golf
can be a very addicting game. And when real golfers want
to tee-it-up, they head for their favorite course, which might
be a gem like Brown Deer in Milwaukee, a public course
that nevertheless plays host to an annual PGA Tour event
every July. What most golfers do not do when they want to
play 18 is head for a tavern. Also, most people are quite
familiar with Tiger Woods. But who knows Jeff Harlow of
Florissant, Missouri? This case is about “golfers” who prefer
taverns to fairways and aspire to be more like Harlow than
Tiger. Our case concerns video golf.
2 No. 03-3785
Golden Tee,1 made by Incredible Technologies, Inc. (IT),
is an incredibly successful video golf game, one of the most
successful coin-operated games of all time, beating all kinds
of classic games like PAC-MAN and Space Invaders. Forty
thousand Golden Tee games (in a dedicated cabinet) were
sold between 1995 and August 2003. The game can be found
in taverns all over America and in other countries as well.
IT spends millions on advertising, and the game generates
huge profits in return.
Golden Tee is played by thousands, and the Harlow chap
we mentioned, according to a November article in the St.
Louis Post-Dispatch, just won the 3rd Annual Golden Tee
World Championship in Orlando, Florida. Harlow pocketed
$15,000 for the effort (not enough though, the paper reports,
for him to give up his day job as a baker at a bagel factory).
With money galore tied into the Golden Tee game, the peo-
ple at IT, understandably, were not happy when PGA
Tour® Golf, made by Virtual Technologies, Inc. (d/b/a
Global VR), appeared on the tavern scene with a competing
game. That’s why we have before us IT’s appeal from the
denial of a preliminary injunction in its copyright/trade
dress case against Global VR.
IT has been manufacturing the Golden Tee game since
1989 and has several copyrights on various versions of the
game. Involved in this appeal are copyrights on the video
game imagery presented on the video display screen and
the instructional guide presented on the control panel. In
addition, there is a claim that the PGA game’s control panel
infringes the Golden Tee’s trade dress.
Golden Tee employs a software program which projects
images and sounds through a video screen and speakers in
a kiosk-like display cabinet. The images are of players and
1
The version we will be discussing is Golden Tee Fore!, which IT
started selling in February 2000.
No. 03-3785 3
golf courses. In front of the screen is a control panel with a
“trackball” in the center, which operates the game. The
“trackball” is a plastic white ball embedded on the game
board. Approximately 1/4 of the ball is visible to the player.
The rest of the ball is underneath the game board.
To play the game the trackball is rolled back for the
golfer-player’s back swing and pushed forward to complete
the swing. As in real golf, the virtual golfer must choose the
club to be used and, for an accurate shot, consider things
like wind and hazards (indicated on the display screen) on
the course.
Aware of Golden Tee’s popularity, Global VR determined
to create a game that was similar enough to Golden Tee so
that players of that game could switch to its new game with
little difficulty. It obtained a Golden Tee game and delivered
it to NuvoStudios (Nuvo), the firm hired to develop the new
game. NuvoStudios was instructed to design a game that
dropped into a Golden Tee box to work with its controls,
which should correspond as closely as possible to Golden
Tee, so that a Golden Tee player could play the new game
with no appreciable learning curve.
Nuvo worked from the existing software of a computer
golf game—Tiger Woods Golf—and made modifications to
convert from a game, played on personal computers and
operated with a mouse, to an arcade game, operated as is
Golden Tee, with a trackball and buttons. Nuvo essentially
copied, with some stylistic changes, the layout of buttons
and instructions found on the Golden Tee control panel.
Global VR terminated Nuvo’s services before the work on
the new game was completed, but it hired key Nuvo per-
sonnel to finish the job. The goal of making it easy for
Golden Tee players to play the new game remained.
The completed new game, PGA Tour Golf, is very similar
to the Golden Tee game. The size and shape of PGA Tour
Golf’s control panel, and the placement of its trackball and
buttons, are nearly identical to those of Golden Tee. The
4 No. 03-3785
“shot shaping” choices are depicted in a similar way and in
the same sequence. Although the software on the two games
is dissimilar, both allow a player to simulate a straight
shot, a fade, a slice, a draw, a hook, etc. by the direction in
which the trackball is rolled back and pushed forward. Al-
though other games, such as Birdie King and Sega’s Virtua
Golf have used trackballs, Golden Tee claims to be the first
to use both a backward and forward movement.
There are also significant differences between the two
games. Golden Tee is played on make-believe courses and
the player is given a generic title, like “Golfer 1.” The PGA
game, on the other hand, uses depictions of real courses,
such as Pebble Beach and TPC at Sawgrass, and it permits
a player to adopt the identity of certain professional
golfers—Colin Montgomerie and Vijay Singh, to name a few.
The cabinets are somewhat different, within the realm of
what is possible in arcade game cabinets, and the games
use different color schemes.
IT filed this lawsuit in February 2003. Its request for a
temporary restraining order was denied, and after expedited
discovery, a 6-day hearing was held on its request for a pre-
liminary injunction. In denying the injunction, the district
court found that Global VR had access to and copied IT’s
original instruction guide and the video display expressions
from Golden Tee. But the court said that IT had not shown
a likelihood of success on the merits of this lawsuit, in part
because (1) IT’s expressions on its control panel are not
dictated by creativity, but rather are simple explanations of
the trackball system; at best, they are entitled to protection
only from virtually identical copying; (2) the video displays
contain many common aspects of the game of golf; and (3)
IT’s trade dress is functional because something similar is
essential to the use and play of the video game.
To obtain a preliminary injunction, a plaintiff must dem-
onstrate a likelihood that it will prevail on the merits of the
lawsuit, that there is no adequate remedy at law, and that
it will suffer irreparable harm without injunctive relief. If
No. 03-3785 5
these requirements are met, the court must then balance
the degree of irreparable harm to the plaintiff against the
harm that the defendant will suffer if the injunction is
granted. Publications Int’l, Ltd. v. Meredith Corp., 88 F.3d
473 (7th Cir. 1996). On appeal, the decision granting or de-
nying a preliminary injunction is reviewed for an abuse of
discretion. A court has abused its discretion when it “com-
mits a clear error of fact or an error of law.” Abbott Labs. v.
Mead Johnson & Co., 971 F.2d 6, 13 (7th Cir. 1992). The
district court’s weighing of the factors is entitled to great
deference. We do not substitute our judgment for that of the
district court.
To establish copyright infringement, a plaintiff must prove
“(1) ownership of a valid copyright, and (2) copying of
constituent elements of the work that are original.” Feist
Publ’ns, Inc. v. Rural Tel. Serv. Co., 499 U.S. 340, 361 (1991).
Copying may be inferred where the “defendant had access
to the copyrighted work and the accused work is substan-
tially similar to the copyrighted work.” Atari, Inc. v. North
American Philips Consumer Elecs. Corp., 672 F.2d 607, 614
(7th Cir. 1982); Warner Bros., Inc. v. American Broad. Cos.,
654 F.2d 204 (2nd Cir. 1981). The test for substantial sim-
ilarity may itself be expressed in two parts: whether the
defendant copied from the plaintiff’s work and whether the
“copying, if proven, went so far as to constitute an improper
appropriation.” Atari, 672 F.2d at 614. Because it is pretty
clear here that Global VR set out to copy the Golden Tee
game, the second question comes closer to the issue we
must face, and it leads us to the “ordinary observer” test:
“whether the accused work is so similar to the plaintiff’s
work that an ordinary reasonable person would conclude
that the defendant unlawfully appropriated the plaintiff’s
protectible expression by taking material of substance and
value.” Atari, 672 F.2d at 614. It seems somehow fitting that
the Atari case, involving the insatiable little yellow circle
PAC-MAN, is a leading case guiding us through the maze
of copyright law as applied to video games.
6 No. 03-3785
In these games, an ordinary observer, seeing a golf game
on the video display and a trackball to operate the game,
might easily conclude that the games are so similar that the
Global VR game must infringe the Golden Tee game. But
because ideas—as opposed to their expression—are not
eligible for copyright protection, see Mazer v. Stein, 347 U.S.
201 (1954), protection does not extend to the game itself.
Atari, 672 F.2d at 615; Chamberlin v. Uris Sales Corp., 150
F.2d 512 (2nd Cir. 1945). For other reasons, which we will
soon discuss, protection does not extend to the trackball. It
is clear, then, that the concept of the ordinary observer
must be viewed with caution in this case, and we must heed
the principle that, despite what the ordinary observer might
see, the copyright laws preclude appropriation of only those
elements of the work that are protected by the copyright.
Atari, 672 F.2d at 614.
In fact, there are several specific limitations to copyright
protection with some relevance to this case. One is the
scènes à faire doctrine. The doctrine refers to “incidents,
characters or settings which are as a practical matter
indispensable, or at least standard, in the treatment of a
given topic.” These devices are not protectible by copyright.
Atari, 672 F.2d at 616. For instance, the mazes, tunnels, and
scoring tables in Atari’s PAC-MAN were scènes à faire.
In addition, the Copyright Act provides that copyright
protection does not extend to any “method of operation . . .
regardless of the form in which it is described, explained,
illustrated, or embodied in such work.” 17 U.S.C. § 102(b).
The Court of Appeals for the First Circuit has declined to
extend copyright protection to a set of commands for a
computer program. Even if there are multiple methods by
which an operation can be performed, a plaintiff’s choice of
a particular method of operation is not eligible for pro-
tection. Lotus Dev. Corp. v. Borland Int’l, Inc., 49 F.3d 807(1st Cir. 1995).
No. 03-3785 7
Useful articles and functional elements are also excluded
from copyright protection. American Dental Ass’n v. Delta
Dental Plans Ass’n, 126 F.3d 977 (7th Cir. 1997). A useful
article is defined in the copyright act as “an article having
an intrinsic utilitarian function that is not merely to portray
the appearance of the article or to convey information.” The
design of a useful article is considered a “pictorial, graphic,
or sculptural work only if, and only to the extent that, such
design incorporates pictorial, graphic, or sculptural features
that can be identified separately from, and are capable of
existing independently of, the utilitarian aspects of the
article.” 17 U.S.C. § 101. The separability issue has caused
considerable consternation. See our recent discussion in
Pivot Point International, Inc. v. Charlene Products, Inc.,
372 F.3d 913 (7th Cir. 2004).
The exclusion of functional features from copyright pro-
tection grows out of the tension between copyright and
patent laws. Functional features are generally within the
domain of the patent laws. As we said in American Dental,
an item may be entirely original, but if the novel elements
are functional, the item cannot be copyrighted: although it
might be eligible for patent protection,
[a]n article with intertwined artistic and utilitarian
ingredients may be eligible for a design patent, or the
artistic elements may be trade dress protected by the
Lanham Act or state law.
126 F.3d at 980.
That means that the elements of our two games, which
are most significant and most clearly similar, are not before
us. The trackball system of operating the game is not
subject to copyright protection. Functional features, such as
the trackball system, might, at least potentially might, be
8 No. 03-3785
eligible for patent protection.2 See American Dental Ass’n,
126 F.3d 977. But that protection would be for a signifi-
cantly shorter period of time than copyright protection. So
the anomaly is that a party can conceivably obtain more
significant protection for the relatively less significant
aspects of its product. For instance, in this case we are
concerned, not with the trackball system but with things
such as whether arrows pointing to the direction a golf ball
will fly are sufficiently original to merit protection under
the copyright laws.
With this discussion out of the way, we move to the issues
which are before us, as framed by IT. Those issues are
whether the district court erred as a matter of law in
creating a new “best explanation exception” to copyright
protection; whether the district court erred as a matter of
law in finding that the scènes à faire doctrine eliminated
copyright protection for its video game expressions; and
whether the district court erred as a matter of law in con-
cluding that IT’s trade dress in the control panel is func-
tional. In discussing the issues, of course, we are concerned
only with whether the district court abused its discretion in
finding that IT did not have a likelihood of success of
prevailing on the merits of its claims at trial.
IT first contends that the district court misunderstood
how the trackball system works, which led it to commit a
legal error in evaluating the control panel and instructions.
As we said, to operate both games, the trackball is rolled
back toward the player to effectuate the back swing of the
golfer on the video screen and pushed forward to complete
the down swing. Directions on the control panel show how
to make various shots, such as a draw, a fade, etc., by
2
However, as IT acknowledges, Golden Tee was not the first vid-
eo golf game to use the trackball format, making a patent some-
what unlikely.
No. 03-3785 9
changing the angle at which the trackball is rolled back and
forward. Nine specific shots are shown on the video display.
The district court referred to “the” 9 different shot examples
shown on the control panel. This, IT contends, shows that
the district court thought that the 9 shots were the only
possible shots when, in fact, subtle variations exist so that
many more than 9 shots are available.
This fundamental misunderstanding, IT says, led the dis-
trict court to a legal error. As IT puts it in a heading in its
brief, the “district court erred as a matter of law in creating
a revolutionary new ‘best explanation’ exception to copyright
protection.” The result of the new exception would be that
the “ ‘best’ physics textbook would have no copyright
protection and could be freely copied, simply because it is
the ‘best.’ ” That argument certainly grabs one’s attention:
What was the district judge thinking?
As it turns out, we need not be hysterical about district
judges creating random exceptions to the copyright laws.
The district judge here, Matthew F. Kennelly, concluded
that the instructions on the control panel were not creative
expressions and that there was “no evidence in the record
to suggest that IT considered anything other than how best
to explain its trackball system when it designed the text and
instructional graphics featured on Golden Tee.” It is from
this rather innocuous statement that IT says the judge cre-
ated a wholly new exception. We disagree with that inter-
pretation. In context, it seems clear that what the judge was
saying is that while there arguably are more ways than one
to explain how the trackball system works, the expressions
on the control panel of Golden Tee are utilitarian explana-
tions of that system and are not sufficiently original or cre-
ative to merit copyright protection. Furthermore, the judge
said, to the extent they might be subject to a copyright, they
would merit protection only against virtually identical
copying.
10 No. 03-3785
What IT is talking about on the control panel are the fol-
lowing: a horizontal graphic which shows the trackball
motions used to control the flight path of the ball and small
indicating arrows above the graphic; three white buttons of
the left side of the trackball and two buttons, one red, one
white, on the right of the trackball; and the textual instruc-
tions in the bottom right corner. Undoubtedly, there is
similarity between the two games in the instructions on the
control panel as well as in the layout of the controls them-
selves.
As to the instructions, we cannot say that the district judge
abused his discretion in finding that the element of cre-
ativity is slight and can be protected only against identical
copying, which does not exist. The element of creativity
in the instructions is less than minimal. Both games use
arrows to indicate the direction in which to roll the track-
ball in order to obtain certain results. While it is possible
that something other than an arrow could have been used
to indicate direction, use of an arrow is hardly imaginative
or creative in this situation. Also, the designs of the arrow
surrounding the trackball differ significantly in the two
games as do the graphics showing shot-shaping possibilities.
To a large degree, the layout of the controls seems to have
been dictated by functional considerations. The trackball
almost necessarily must be in the center of the control panel
so that right- and left-handed players can use it equally
well. It must not be so close to the upright video display that
a player would smash her hand into the screen too force-
fully after making a shot. Global VR claims that the buttons
must be aligned across the center of the control panel for
ease of manufacturing. We do not find an abuse of dis-
cretion in the district court’s conclusions that the buttons
appear to have been placed where they are for purposes of
convenience and cannot be said to be expressive. We also
note that on Golden Tee, the white button to the right of the
trackball is labeled “backspin” and provides for just that; on
No. 03-3785 11
the Global VR game, the corresponding button is labeled
“shot type” and provides for backspin and topspin.
IT also contends that the district court erred as a matter
of law in finding that the scènes à faire doctrine applied to
eliminate copyright protection for the video imagery. Global
VR, of course, disagrees, although it acknowledges that, in
an appropriate case, the imagery of a video arcade game
may be protected by a copyright. However, Global VR argues
that in this case the elements over which IT claims protec-
tion are inherent either in the idea of video golf or are
common to the creation of coin-operated video games in
general. The district court agreed and determined that
many elements of the video display were common to the
game of golf. For instance, the wind meter and club selec-
tion features were found to account for variables in real golf
and so were indispensable to an accurate video represen-
tation of the game. Furthermore, the court said that the
game selection features, such as the menu screens which
indicate the number of players and other variables of the
game, are common to the video-game format.
As we said, scènes à faire refers to incidents, characters,
or settings which are as a practical matter indispensable, or
at least standard in the treatment of a given topic. Looking
again at Atari, we see that the court found that the game
was primarily unprotectible:
PAC-MAN is a maze-chase game in which the player
scores points by guiding a central figure through var-
ious passageways of a maze and at the same time avoid-
ing collision with certain opponents or pursuit figures
which move independently about the maze.
Atari, 672 F.2d at 617. Certain expressive matter in the
game was treated as scènes à faire and would therefore re-
ceive protection only from virtually identical copying. The
court said that the “maze and scoring table are standard
game devices, and the tunnel exits are nothing more than
12 No. 03-3785
the commonly used ‘wrap around’ concept adapted to a
maze-chase game.” Atari, 672 F.2d at 617. The use of dots
to award points was also scènes à faire. The allegedly in-
fringing game, K. C. Munchkin, had slight but sufficiently
different versions of these items to preclude a finding of
infringement. The court went on to find, however, that the
concepts of the central figure as a “gobbler” and the pursuing
figures as “ghost monsters” were wholly fanciful and thus
subject to more protection. K. C. Munchkin had “blatantly
similar features,” giving Atari a likelihood of success of
showing infringement.
In contrast, we see no error of law in Judge Kennelly’s
finding that the Global VR video display is subject to the
scènes à faire doctrine. Like karate, see Data East USA, Inc.
v. Epyx, Inc., 862 F.2d 204, 209 (9th Cir. 1988), golf is not
a game subject to totally “fanciful presentation.” In pre-
senting a realistic video golf game, one would, by definition,
need golf courses, clubs, a selection menu, a golfer, a wind
meter, etc. Sand traps and water hazards are a fact of life
for golfers, real and virtual. The menu screens are standard
to the video arcade game format, as are prompts showing
the distance remaining to the hole. As such, the video dis-
play is afforded protection only from virtually identical
copying.
Given that certain items are necessary to making the game
realistic, the differences in the presentation are sufficient
to make IT’s chances of success on the merits unlikely.
Global VR has “real” courses and “real” golfers; Golden Tee’s
courses are imaginary and its golfers generic. In the Global
VR game, a golf bag appears on the screen as the player
chooses a club for the shot he intends to play. Global VR
offers a “grid” mapping the green as a guide for putting.
Golden Tee has no such device. Also, the Global VR game
has a helicopter that whirls overhead from time to time.
Both games mimic condescending real television golf
announcers, but the announcers use different phrases: “the
No. 03-3785 13
fairway would be over there” and “I don’t think that’s going
to help a whole lot” in Global VR versus “That can only
hurt,” “You’ve got to be kidding,” and “You can lead a ball to
water but . . .” from the Golden Tee announcers. Judge
Kennelly did not abuse his discretion on this point.
The trade dress claim requires little discussion. The term
trade dress refers to the “appearance of a product when that
appearance is used to identify the producer.” Publications
Int’l, Ltd. v. Landoll, Inc., 164 F.3d 337, 338 (7th Cir. 1998).
To prevail on a trade dress claim, IT must establish that its
trade dress is nonfunctional, that it has acquired secondary
meaning, and that a likelihood of confusion exists between
the trade dress of the two games. Computer Care v. Service
Sys. Enters., Inc., 982 F.2d 1063 (7th Cir. 1992). Although
IT frames the issue as involving only the control panel, both
parties veer into a discussion of their cabinets. Of the
cabinets, we will say only that they are somewhat similar
in shape, but so are most arcade game cabinets. The shapes
of the sides of the cabinets are different; the coloring is
different. The sides of the Golden Tee cabinet are white,
while the much less subdued PGA Tour cabinet is an
intense blue. The only words or logos on the sides of the
Golden Tee cabinet, set off in yellow, are “IT Incredible
Technologies” in an upper corner and a circle with “G Fore
T” printed inside. On the other hand, the Pro Tour cabinet
has a good deal more going on. It starts with “Global VR
Presents.” Then there is a circle containing the words “EA
Sports PGA Tour Golf.” Below the circle are the words
Real Courses
Real Golfers
Real Golf
all with the PGA Tour logo between the words. The PGA
Tour logo, by the way, appears five times on each side of the
cabinet.
14 No. 03-3785
As to the control panel, we see no error in the district
court’s conclusion that IT had no likelihood of success on
this claim. The control panel and the trackball system are
functional.
The Global VR game is emblazoned with the name EA
Sports™ and PGA Tour® Golf logos. Its coloring is different
and considerably bolder than that of the Golden Tee game.
Golden Tee provides arrows to demonstrate its descriptions
of the trackball system; Global VR does not. Global VR
names the shots in its shot-shaping diagrams; Golden Tee
does not.
IT argues, however, that the district court did not take
into account what happens in the marketplace. IT says,
“Bar and tavern patrons, often in dimly lit spaces, typically
approach and play these video games while consuming alco-
hol; they are not consumers using high degrees of care in
selecting, identifying, or differentiating the Golden Tee and
PGA Tour games”! One wonders how different the control
panels would have to be to avoid confusing such users. The
decision of the district court denying IT’s request for pre-
liminary injunction relief is AFFIRMED.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—3-15-05