ECLP May issue :august 05 9/5/12 09:57 Page 08 VIRTUAL PROPERTY Virtual worlds and online theft after the Runescape saga third and forced him to log onto back as 1994, and in the early days The Dutch Supreme Court ruled last the game and 'drop' his of the World Wide Web, Gary January that the theft of virtual possessions, most notably a virtual Kremen saw the potential in the goods should be regarded as a 'amulet' and a 'knife', thus allowing domain name 'sex.com' and duly criminal offence. This unique one of the assailants' Runescape registered the name to his business. decision surprised many within the characters to 'pick' them up. The Stephen Cohen had also spotted youths were convicted of assault the commercial value of the industry and many believe it has set and also for the theft of the 'goods', domain name and fraudulently a precedent for similar cases. the latter conviction making it to obtained it by posing as a Steven James and Sam Kempsey, the Dutch Supreme Court on representative of Kremen's of Latham and Watkins, examine appeal. The appeal was rejected on business and authorising its the grounds that despite the transfer to Cohen's corporation. the potential legal impact of this inherent intangibility of the The US Federal Court was ruling and explore the channels of possessions, the victim had concerned as to whether property litigation that this ruling could open invested 'time and energy' in rights could exist in an intangible up, both in a criminal and a civil obtaining them and they were in object and this formed the context. the 'exclusive domain' of the victim backbone of the litigation. It was at the time that the offence was held that a domain name could be Digitalisation of society committed. The result could be considered 'property' as it was 1) The notion that taking something rationalised as supporting a claim capable of precise definition; 2) intangible, virtual, and seemingly to possessory title over no title at capable of exclusive possession; 'valueless' from another player in a all. and 3) the putative owner could computer game could constitute establish a legitimate claim to theft and thus a criminal offence Virtual items exclusivity. would come as a surprise to many. Virtual worlds, avatars and virtual In his review of the 'Kremen This however, forms the basis of items are big business. The current Cohen' case, the commentator what may prove to be a seminal market for virtual items is Allen Chein sagely predicted: 'given decision by the Dutch Supreme estimated to be worth around the popularity of MMORPG's, it is Court, who, on 31 January 2012, US$5bn 3. A well-known example of reasonable to conclude that a ruled that the theft of virtual goods a virtual world is Second Life, the dispute involving virtual items is was indeed a criminal offence. As virtual online world which enables just around the corner' 5. Indeed, noted by the Court, 'due to the users, or 'residents', to interact with domain name disputes over the digitalisation of society, a virtual each other though their avatars misappropriation of a third party's reality has been created, all aspects and buy and sell virtual goods trade marks or other rights are of which cannot be dismissed as including buildings, art and clothes now a common part of the mere illusion' 1. using Second Life's own internal contemporary legal landscape, currency, with some users earning whether dealt with through the Runescape and MMORPG's in excess of a million dollars by courts or the tailor made The facts in question concern the using the site. Virtual items are WIPO/UDRP procedure. The theft immensely popular online fantasy therefore valuable 'commodities' of virtual items in a computer game Runescape, which at the time which can be traded in the same game is arguably only a logical of writing has 175 million way that physical goods can, extension of that, albeit the shift registered users 2 and is one of the although there has been little or no from civil to criminal liability is a largest, most expansive free case law on the topic to guide the marked one within the guise of MMORPG's (massively courts. intangible property rights. multiplayer online role-playing The Runescape judgment on game) in the world. Players create Kremen -v- Cohen 4 virtual items is only of direct and an online persona and complete Despite the lack of both common immediate applicability to Dutch various quests and develop skills, law and statutory guidance, a law. It is apparent, however, that, as being rewarded along the way with global trend towards an acceptance the aforementioned cases and the ability to use, among others, a of the applicability of property commentaries have illustrated, wider variety of the game's rights to intangible objects has there has over the last decade, been weapons. emerged, and had started well an increasing acceptance of the In 2007, two youths assaulted a before the Runescape case. As far concept of 'virtual property' as 08 E-Commerce Law and Policy - May 2012 ECLP May issue :august 05 9/5/12 09:57 Page 09 VIRTUAL PROPERTY Virtual worlds and online theft after the Runescape saga being equivalent to physical In such a that the English courts would be virtual items apparently need only property by courts of all fast-moving willing to view virtual goods as be the product of the 'time and jurisdictions. This should not be area as property in criminal proceedings energy' spent obtaining them. As surprising given that copyright information under the Theft Act 1968. noted, it may be sufficient that the technology, it itself is an intangible right whose is hard to complainant has a possessory title theft can give rise to both civil and predict how The IP perspective for the time being of the 'goods' criminal liability 6. It is therefore courts, of all A major stumbling block in theft which is a better title than the thief, seemingly only a matter of time jurisdictions, proceedings in the English Courts who has no right or title at all. before a similar case makes its way will interpret may arise however, when the court the to the courts of England & Wales. judgements came to decide whether the Virtual and real world blurring that emerge possessions actually belonged to It does seem a strange concept that England and Wales within the the victim. intellectual property that belongs Theft of virtual items in England guise of When players register to play to a publisher could have what we and Wales constitutes 'dishonestly virtual Runescape, they agree with the could term 'frozen ownership property. It is appropriating property belonging however game's publisher 'Jagex' that all rights', that can be transferred to a to another with the intention of clear from intellectual property will remain third party (who has acceded that permanently depriving the other of the cases Jagex's property. Furthermore, the the publisher owns all rights to the it.' 7 Taking the Runescape case as referred to, terms and conditions of use state items) just by their use of that that courts an example, there was clearly (i) have shown a that 'Jagex owns all rights in the intellectual property over a dishonesty, (ii) an appropriation, diminished Jagex products and you are only temporal period. and (iii) an intent to permanently reluctance to granted permission to use such It is perhaps easier to understand deprive the victim of his online dismiss products, subject to, and in such a concept if we accept 'the persona's possessions. However, the virtual items accordance with these Terms and inherent dichotomy in holding as intangible, interpretation of 'property that valueless and Conditions'. intellectual property rights in a belongs to another' is considerably with no real Such permission is granted by work versus owning the chattel murkier. The rationale behind s.4 proprietary way of a 'non-exclusive, non- that is a manifestation of that of the Theft Act 1968, which was rights transferable licence for the period work'. As technology becomes both drafted very widely to define attached to of membership' and it is made more advanced, and prevalent in them. property as 'money and all other clear that 'all materials, including 21st century society, computer property, real or personal, without limit all information, code is increasingly crafted to including things in action and software, data, text, photographs, produce virtual items that act like other intangible property', can graphics, sound and video' are real world objects. As a result, arguably be justified as being 'an protected by copyright and other viewing virtual items such as the appreciation of the nature of intellectual property rights. This Runescape mask and amulet 'property' within a society at any permission to use the software or exclusively as intellectual property particular point in time' 8. Such a End User Licence Agreement is possibly shortsighted, and broad definition gave leeway to the (EULA) is therefore intended to subjecting these items to the inevitable temporal changes in limit the rights to which the user common law principles of personal what property was conceived to be has access. property is arguably easier to as a result of societal and It should therefore follow that if a justify. It could therefore be that, in technological catalysts. The provider such as Jagex defines a a criminal context, the English definition is so broad that the Act virtual object as being their courts would be willing to view actually goes so far as to list property to which a Runescape virtual items as 'property specific exclusions to what may user only has a limited right of use, belonging to another'.