“‘Say it ain’t so, bro!’” (Episode 14)

Previously we’ve discussed Hooli’s reverse engineering of Pied Piper’s technology and the threatened lawsuit for ownership of the technology.  In Episode 14, Pied Piper faces a new threat:  Endframe, a Pied Piper competitor, has also stolen Pied Piper’s technology, in collusion with VC firm Branscomb Ventures.  This started back in Episode 10, when the Pied Piper team pitched to Branscomb and were “brain raped.”  The team shared the intimate, technical details of Pied Piper’s middle-out technology before realizing what was happening.  Branscomb/Endframe then used the information Pied Piper revealed to create their competing product.  But was there anything Pied Piper could have done to protect itself?

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VC’s running scared – Hooli is suing Pied Piper (Episodes 9 and 10) continued

Last post I mused that had Richard taken certain steps in the first season of Silicon Valley, he might now have ammunition to use against Hooli’s lawsuit.  What am I talking about?  To very crudely recap what happened last season, Richard invented Pied Piper, a music copyright search service that hid within it amazing lossless compression technology.  Richard shared his software with two “brogrammers” at Hooli, who (being slightly smarter than they appeared) realize the importance of Richard’s compression technology and informed Gavin Belson (Hooli’s CEO).  After Richard refused to sell Pied Piper to Hooli, Hooli reverse-engineered Pied Piper and used Pied Piper’s technology as the basis of Hooli’s competing product called Nucleus.  Continue Reading

VC’s running scared – Hooli is suing Pied Piper (Episodes 9 and 10)

HBO’s “Silicon Valley” has quickly become a must watch for all budding entrepreneurs, but the second season has opened up with a multitude of risks and roadblocks that could be faced by real world entrepreneurs.  Here, we take a light look at the legal issues arising from the latest episodes. Continue Reading

EU Investigating Geo-Blocking of Online Video Games

On May 6, 2015, the European Competition Commission released a new Digital Single Market Plan, and simultaneously launched a broad antitrust investigation into e-commerce.  The DSM plan, consisting of sixteen proposals, seeks to create a single digital European market where access to digital goods and services is unfettered across all 28 member states.  The European Competition Commission will investigate whether firms’ restrictions on cross-border online trade violate the EU competition laws, and attempt to remedy them through enforcement mechanisms.  High on the list is the geo-blocking of online content, including video games.  The impending probe will likely target some large U.S. technology companies. Continue Reading

Baker v. Microsoft Corporation Revisited: Microsoft Seeks to Stop Class Action Plaintiffs From Shortcutting the Appeals Process

We recently reported on a Ninth Circuit Court of Appeals opinion reversing a district court’s decision to strike class action allegations in a putative class action against Microsoft.[i]  In Baker v. Microsoft Corporation, the Ninth Circuit held that proof that individual class members were damaged by an alleged defect (here, a defect in Xbox 360 video game consoles that allegedly resulted in scratched game discs) was not necessary for a class action to be certified.[ii]  Continue Reading

Baker v. Microsoft Corporation: Game Companies Beware, Ninth Circuit Court of Appeals Decision May Make It More Difficult to Defeat Class Actions

A Quick Overview

The Ninth Circuit Court of Appeals recently reversed a district court’s decision to strike the class action allegations of a putative class action against Microsoft.[1]  The Ninth Circuit’s decision means that the district court must reconsider whether to allow the case to proceed as a class action.  Because the decision as to whether to certify a class generally determines whether a class action will proceed, the Ninth Circuit’s decision is an important one for game companies, which are often confronted with class action lawsuits. Continue Reading

“Unlimited” Time Off Policies – Fad or Fun?

Over the past several years the concept of “unlimited” vacation policies have sprung up around the philosophy that it allows companies to treat its employees with respect and empower them to make their own decisions regarding when to work and when to play.  Being at the center of innovation, many Silicon Valley companies have been early adopters, including Netflix, Evernote and Quirky.  We are now seeing more traditional companies also jump on the bandwagon and follow the lead of Silicon Valley and offer unlimited paid vacation.  While there are many articles arguing the pros and cons of such policies and who they really benefit, what are the legal implications in deciding whether a “flexible” time off policy is the right choice for your company? Continue Reading

Bargaining with Apple: Understanding the iOS Developer Program License Agreement

This article, which focuses on the iOS Developer Program License Agreement, is the second of two articles geared at helping app developers understand the fine print of the agreements they are asked to enter into with the companies that distribute their products. The first article on “Bargaining with the Little Green Robot: Understanding the Google Play Developer Distribution Agreement” can be found here.

When it came to market in July 2008, Apple, Inc.’s (“Apple”) App Store created the first centralized market for applications for mobile devices.  It was an instant hit.  In the App Store’s first year alone, users downloaded over 1.5 billion applications.  And the numbers have only grown from there.  The App Store now currently hosts approximately 1.3 million unique applications that have been downloaded a staggering estimated 85 billion times, resulting in payouts to app developers of more than $13 billion.  With numbers like these, app developers cannot afford to overlook this market.  But what does Apple ask in return for this impressive distribution opportunity?  This article examines some of the major terms of the iOS Developer Program License Agreement (the “License Agreement”).

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California Repeals Prohibition on Use of Alternative Currencies

From pet grooming services paid with currencies backed by aggregated gift cards to coffee shops in Palo Alto and San Francisco that accept digital currencies for a latte, many Californians are completing everyday transactions with digital currencies.  Community currencies (such as currencies “created by members of a community in conjunction with merchants who agree to accept the alternative currency”[1]) are seeing some popularity in Sonoma County, Humboldt County, and other areas of Northern California.  Many video games continue to facilitate in-game and other purchases using alternative currencies.

The payments and video game industries have recognized, however, that quite often law moves more slowly than technology.  In support of continuing the proliferation of alternative currencies,  California Assembly Bill 129 (the “Alternative Currencies Act”) became effective on January 1, 2015.  The Alternative Currencies Act loosens existing prohibitions on use of currencies other than the lawful money of the United States by repealing Section 107 of California Corporations Code.[2]

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Investment Trends in the Gaming Industry

Over the past decade, the gaming industry has evolved into one of the hottest sectors of mobile internet services.  VentureBeat recently reported that in the trailing twelve months of Q3 2014, gaming accounted for $18 billion in trade exits and IPOs.  A prime example of this is Amazon’s acquisition of game-livestreaming startup Twitch for $970 million in August of this year. Gaming is also currently one of the more profitable parts of the mobile internet sector, boasting an average 9.9x return on a three year investment.

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