Trespass to (Virtual) Chattels
Assessing Online Gamers' Authority to Sell In-Game Assets Where Adhesive Contracts Prohibit Such Activity
Vol. 8
January 2008
Page
When a time comes that new modes and venues exist for communities, and said modes are different enough from the existing ones that question arises as to the applicability of past custom and law; and when said venues have become a forum for interaction and society for the general public regardless of the intent of the creators of said venue; and at a time when said communities and spaces are rising in popularity and are now widely exploited for commercial gain; it behooves those involved in said communities and venues to affirm and declare the inalienable rights of the members of said communities.[1]
-Raph Koster
Introduction
A lawyer supplements her income by building mansions in the evening.[2] A teacher in California pays his mortgage by selling escort services to New York City dwellers.[3] A real estate broker buys and sells land around the globe, never leaving her desk or paying property taxes.[4] Right now, millions of people are engaging in online communities rather than talking with friends over a coffee, joining their classmates in a lecture hall, or going to work.[5] Or so it seems: the most innovative video games allow players to engage in all of those activities, and more, without having to take their hands off the keyboard.[6]
Today’s games use the Internet and technological advances to create comprehensive, dynamic virtual worlds.[7] Massively multiplayer online role–playing games (“MMORPGs”) provide the platform for these virtual worlds.[8] Through this virtual interface, players create virtual representations of themselves:[9] they buy, improve, sell, or otherwise enjoy virtual plots of land;[10] construct virtual cottages, mansions, and department stores;[11] create, sell, pawn, and trade virtual chattels;[12] and amass virtual clout for accomplishing outlandish acts or securing otherwise unavailable artifacts.[13] For some, the prospect of a second life motivates participation in these worlds.[14] For others, participation constitutes a business venture aimed at converting hypothetical property in virtual worlds into identifiable property with real economic value.[15] This Article addresses the complicated legal issues that accompany these business ventures and the rapid growth of sociocultural interests in MMORPG environments (“MMORPGEs”).[16]
Online role–playing games have existed for at least two decades[17] and constitute one of the most successful business enterprises that engage the Internet.[18] Current worldwide participation in MMORPG environments is unprecedented.[19] Sony secures about $3,600,000 in monthly revenue from its Everquest title.[20] More gamers play Blizzard Entertainment’s (“Blizzard”) World of Warcraft than any other MMORPG title,[21] and arguably even more than any other game that implements the Internet.[22] Blizzard likely secures at least $117,000,000 in monthly subscription fees alone.[23] As might be expected, the broad participation responsible for this economic success, considered with the interactive nature of these virtual worlds, has produced secondary markets for virtual objects secured inside the game environment.[24]
The practice of selling virtual chattels is complicated; consider the following example. Player A spends six months collecting virtual currency in World of Warcraft.[25] He visits a website that offers to purchase his virtual gold for a sum of United States dollars.[26] The company pays him, and a company representative and Player A both log into the virtual world.[27] They meet in a virtual house and Player A gives the company’s representative avatar[28] the virtual currency.[29] The company then sells the gold to other gamers at a profit.[30] This practice is called real money trade (“RMT”).[31] Avatars often communicate to create groups that find valuable artifacts and amass significant quantities of virtual currency, often selling the items or currency in RMT on auction websites, and splitting the profits. Most MMORPG end–user license agreement (“EULA”) contracts prohibit RMT activity.[32]
Although Blizzard has not filed any lawsuits to date, it has maintained a hard–line stance against RMT activity.[33] Blizzard has eliminated offending players’ accounts and halted virtual property auctions on eBay.[34] Blizzard recently banned over 59,000 accounts and removed 22,000,000 gold from the virtual economy for “farming gold” and using third–party programs to collect the virtual currency more efficiently.[35]
Blizzard, however, is not a stranger to the courtroom.[36] Gamers have filed suits against the company before,[37] and could file suit again as they secure interests in virtual worlds.[38] Considering the population of that environment,[39] and the frequency with which that population engages in RMT,[40] scholars predict a lawsuit to resolve the RMT issue.[41]
This Article posits that courts should recognize legally cognizable property interests in virtual currencies and chattels secured in MMORPGEs. Specifically, courts risk eliminating legitimate property interests when they enforce the EULAs, Terms of Service (“TOS”), and/or Terms of Use (“TOU”) upon which designers predicate access to the virtual world.[42] Part I introduces virtual worlds, virtual property, and the contracts that designers use to control gamer activity. Part II demonstrates that contracts of adhesion that prohibit RMT activity unconscionably eliminate gamers’ property interests in MMORPGEs. Part III recommends that courts find a valid gamer–borne cause of action in trespass to chattels, and considers necessary limitations on that doctrine. Provisions that prohibit RMT activity and allow designers to delete gamers’ virtual property eliminate valuable emergent property interests.[43]
I. Virtual Worlds, Real Money, and Underdeveloped Law
A. Life in MMORPG Environments, and Real World Contractual Restrictions Imposed By Designers
Blizzard Entertainment’s World of Warcraft MMORPG provides an instructive example of the process by which users enter MMORPGEs. After purchasing and installing the client software and subscribing to a payment plan, players create an avatar[44] that will inhabit the world.[45] Players choose one of two factions with which their avatar will align.[46] After faction selection, participants choose a race.[47] Players then choose a sex for their avatar, and select one of several hairstyles, skin tones, and eye colors.[48] Finally, players choose a class, which will determine some skills that their avatar, and not others, can employ in the virtual world.[49]
After creating and naming an avatar, “newbie” participants enter the virtual world in an area similar to a training ground, where they perform mundane “quests,” like collecting flowers or slaying coyotes to achieve “experience.”[50] Collecting a certain amount of experience eventually promotes an avatar to the next level.[51] With each level, players acquire new abilities and access to more difficult areas of the virtual world.[52] Reaching the highest level might take months of dedicated play,[53] during which time avatars learn marketable trade skills and collect increasingly valuable armor, weapons, artifacts, and other desirable virtual chattels.[54] Players can put those items in the virtual auction house where other players bid using virtual currency collected during their travels.[55] Players often elect to sell those objects, and/or the virtual currency used to purchase them, in RMT transactions.[56]
Before this process can begin, gamers must agree to a contract that conditions avatar creation on a wide variety of terms.[57] MMORPG designers implement EULA contracts to control social norms and economic activity in MMORPGEs.[58] As such, EULAs serve important purposes in MMORPGEs.[59] Since MMORPGs are games that take place in a virtual world, designers have an interest in establishing the rules that govern the world.[60] Computer code, however, cannot regulate social policies and behavioral norms; one might consider EULA terms as compensating for designers’ lack of control.[61] EULA agreements protect, through contract principles, sociocultural norms that evade regulation through computer code.[62]
Some EULA contracts for accessing MMORPG virtual worlds contain controversial terms and clauses.[63] As game designers’ require blanket assent to all terms in an EULA,[64] EULAs consequently create gamer–designer tension.[65] Designers may have a variety of interests.[66] For example, EULAs commonly require users to disclose their real identity when they sign up for the game,[67] prohibit offensive avatar names,[68] restrict controversial speech or behavior,[69] or limit such activity to virtual areas designated “mature.”[70]
One area related to RMT activity where designers and gamers both have an interest is virtual economy maintenance.[71] One common EULA provision prohibits RMT activity.[72] Nearly all MMORPGEs simulate a property–based economy.[73] MMORPG designers include a variety of EULA provisions intended to eliminate RMT activity.[74] Some titles expressly prohibit such activity.[75] Others claim all property in a virtual world and/or all intellectual property rights in a virtual world.[76] Others prohibit the gamer from selling his or her account or copy of the software to others.[77] Designers regularly reserve the right to delete an account or turn off the virtual world at their leisure to prevent undesirable activity.[78] By retaining rights to as much in–game content as possible, designers create more provisions upon which they can rely to preclude RMT activity.[79]
B. American Jurisprudence Fails to Address Virtual Property Interests in MMORPG Environments [80]
RMT activity results from the substantial and increasing virtual population,[81] and an expansive industry dedicated to selling in–game property exists.[82] Given the widespread RMT activity in MMORPGEs,[83] legal scholars eagerly anticipate a gamer or designer–borne lawsuit to protect their interests in virtual assets in MMORPGEs.[84] For what legal rights should litigants argue in virtual worlds, and what legal rights might courts find?[85]
No court in the United States has had the occasion to completely consider a legally cognizable virtual property right in an MMORPGE.[86] In Blacksnow Interactive v. Mythic Entertainment,[87] Mythic sued Blacksnow for running a “virtual sweatshop.”[88] According to Julian Dibbell’s often–cited account of the case, Blacksnow employed unskilled workers to play Ultima Online and Dark Age of Camelot, earning gold and artifacts and selling them on websites like eBay.[89] Mythic argued that the Blacksnow operation infringed its intellectual property rights.[90] Blacksnow ultimately “skipped town without a trace”[91] after the Federal Trade Commission found that the company fraudulently, and perhaps sardonically, offered non–existent computers for auction on eBay.[92] The case constitutes a disappointment to the extent that procedural default precluded the court from considering whether virtual world chattels had legally cognizable value.[93]
In the first lawsuit of its kind,[94] a virtual world resident sued Linden Labs, a company that designs a popular virtual environment called Second Life.[95] The gamer alleged that the game developer inappropriately turned off his account, thereby vaporizing his virtual land and any potential profits resulting there from.[96] Although the Second Life TOS grants to gamers intellectual property rights to property created in–game,[97] it also specifies that participants have no right to in–game property if Linden Labs terminates their account[98] and that participants do not own the server data that contains their property.[99] The substance of the yet–to–be–resolved complaint alleges contract and property causes of action.[100] Even though Linden Labs grants gamers intellectual property rights in virtual commodities created online, Linden Labs reserves the right to pull the plug on an account, and hence on any associated virtual property.[101] An MMORPG policy that gives gamers a contractual right to objects created in–game (property interest in virtual chattels), but does not preclude the designer from eliminating that property, seems directly contradictory.
II. Virtual Chattels Secured in MMORPG Environments as Property Under Traditional and Contemporary Property Theories
Gamers spend countless hours investing their time, energy, and identities to develop their avatars in virtual worlds. That development occurs when players acquire money, valuable items, and the social cache that follows acquisition of such rare items. Moreover, MMORPG participants invest emotionally in their avatars, establishing a constitutive psychological relationship with their in–game personae. An exploration of this investment reveals that under a Lockean, utilitarian, or personhood theory of property, gamers secure legally cognizable property interests in virtual chattels.
A. Lockean Theory: MMORPG Participation as Labor, not Play
John Locke’s labor theory of property promotes a legally cognizable property interest in virtual property secured in MMORPGEs because gamers invest substantial time, energy, and resources into virtual worlds.[102] Locke’s theory of property posits that a person obtains an ownership interest in an object by injecting his or her labor into it.[103] Locke argued that property constitutes a natural right resulting from labor.[104] Because each individual has a property interest in his or her flesh and blood,[105] labors exacted by that flesh and blood fall within his or her ownership.[106] Without that labor, property would have no value.[107] The person who mixes his or her labor with a thing also elevates that thing to its highest value.[108]
Lockean property theory is well established in American jurisprudence.[109] Since Pierson v. Post,[110] the law has rewarded useful labor applications that create property value.[111] Professor Joshua A. T. Fairfield reported that a Chinese litigant invoked Locke’s labor theory of property when he explained why the Chinese court should order an MMORPG designer to return virtual chattels to him stolen via fraud by another player.[112] The gamer argued that he “exchanged the [virtual] equipment with [his] labor, time, wisdom, and money, and of course they are my belongings.”[113] Taiwanese law expressly recognizes that virtual property has real world value and grants a property interest to “the owner of the code object, not the owner of the server on which the code happens to reside.”[114] Courts in other countries recognize that labor invested in MMORPGEs progresses towards a legally cognizable property interest.[115]
Gamers inject their labor into MMORPGEs, such that they acquire a property interest in the chattels secured therein.[116] An individual who earns a real world living from virtual business ventures dedicates substantial time and energy into that project.[117] In some MMORPGEs, gamers play for months or years before acquiring access to world areas replete with saleable virtual chattels.[118] Some gamers elect to make a business from selling those chattels.[119] Others tire from the game, sell their avatar and its possessions on a website like eBay, and earn a net profit from their game play.[120]
Moreover, gamers increase the value of their virtual world and their virtual chattels through their labor.[121] Inasmuch as RMT activity constitutes a secondary market, that market attaches real world value to unused virtual chattels.[122] There is no practical limit to the amount of RMT activity that virtual worlds can accommodate, nor to the number of unused virtual chattels.[123] Gamers should enjoy exclusive rights to virtual chattels because acquisition does not exhaust resources, and the law should promote things in which individuals inject their labor by recognizing a private property interest in virtual chattels sold in RMT transactions.[124] Gamers inject their labor into MMORPGEs, and earn the right to use and enjoy virtual chattels secured in MMORPGEs.[125]
Locke’s labor theory does not only apply to individual gamers who engage in “click–slavery” to acquire objects that they elect to sell.[126] Businesspersons inject labor in incorporated and unincorporated entities that specialize in securing and distributing valuable virtual currencies, items, and accounts for different MMORPGEs.[127] Those businesses coordinate with gamers and employ persons throughout MMORPGEs.[128] One company, IGE, claims that its revenues will exceed the revenues generated by the companies that create MMORPGEs.[129] The idea that a number of persons labor to create a business that coordinates and distributes significant quantities of virtual chattels buttresses the Lockean justification that the MMORPG designer does not have all the sticks in the virtual property bundle. Moreover, recognizing labor invested in virtual worlds will encourage businesses to invest in these environments.[130]
B. Personhood Theory: MMORPG Avatars and Chattels as Constitutively Related to Individuals, Businesses, and Communities in Virtual Worlds
Since MMORPG participants, businesses, and the community in MMORPGEs bear strong identificatory relationships with their avatars and the virtual goods that they collect and trade in virtual worlds, personhood theory compels the law to recognize a property interest in virtual chattels. Personhood theory, prominently applied in a legal context by Margaret Jane Radin, derives from Hegel’s theory of property as an extension of the self.[131] Under this theory, property bears a constitutive relationship with identity,[132] and the law should promote property with which an individual has such a relationship.[133] Personhood theories value most dearly the interests from which separation causes pain,[134] and the law must therefore recognize restraints on property that fail to account for an individual’s right to control the property with which he or she has a constitutive relationship.[135] The Supreme Court recognized this property justification in discussing the intangible property interests protected by copyright law.[136] The well–recognized shift in landlord–tenant law from a property construct to a property–contract amalgam implicitly recognizes the importance of property with which individuals have important personhood interests.[137]
As with their personal property, individual gamers unquestionably have an identificatory relationship with their avatars and the accoutrements that their avatars acquire. The law should promote that relationship by identifying a property interest in virtual chattels and currency.[138] Many MMORPG participants use their avatars to experience an otherwise unavailable sociocultural position.[139] Depending upon an avatar’s group or guild associations, style of play, social prowess, or even race, sex, and physique, an avatar can provide important insight into an individual’s personality and beliefs.[140] Since MMORPGs require cooperation between groups of people and social interaction,[141] characters acquire a positive or negative reputation in the virtual world when they acquire valuable items or accomplish outlandish feats.[142] A magical piece of chain mail or a swanky virtual bar constitutes property from which deprivation causes pain: Chinese courts have documented suicide and murder resulting from virtual property theft.[143] Individual games acquire personhood rights in virtual property acquired in–game because their avatars represent who they are and, perhaps, who they are not.[144]
Moreover, companies and other business entities that buy and sell virtual chattels also have important personhood relationships with property secured in MMORPGEs.[145] The predominantly commercial property interests of these business entities do not eliminate the possibility for a personhood relationship.[146] Individuals work together to create businesses, and the product of that labor relates constitutively with those individuals.[147] The highest volumes of RMT activity result when a person creates a business by securing and selling large quantities of currency or chattels from MMORPGEs.[148] For example, in Second Life, avatar Ansche Chung has created a substantial network of persons who buy and sell virtual real estate.[149] In other MMORPGEs, companies like IGE have created large buy–and–sell networks engaged in RMT in various virtual worlds.[150] Some MMORPG designers encourage RMT activity and host auction houses that provide a controlled marketplace for virtual goods.[151]
Conversely, a different argument supports the allowance of other MMORPG designers to prohibit RMT activity. Blizzard, an MMORPG designer that capitalized the MMORPG market by creating World of Warcraft, is an example of businesses with important personhood interests in establishing a particular type of MMORPG environment.[152] Because Blizzard is the designer, it has the right to determine the rules of the game to protect its identificatory relationship with the MMORPG industry and the virtual world it designed.[153] This argument posits that the law should promote Blizzard’s identificatory relationship with its MMORPG environment, by allowing it to prohibit RMT activity that alters the virtual economy with which Blizzard has a personhood interest.[154] This argument is also consistent with an intuitive image of property, namely that Blizzard owns the data that constitutes the virtual world and Blizzard, therefore, controls every stick in the bundle.[155]
However, the constitutive relationships established between individuals and virtual chattels, and between businesses that coordinate avatars and RMT activity, remains an important consideration. These constitutive relationships ultimately form a community with personhood interest that the law should protect.[156] If the game designer elected to turn off the server to prevent RMT activity, interrupting millions of players engaged in virtual worlds, that deprivation would cause pain to individuals and to the greater World of Warcraft community.[157] MMORPG participants hold weddings and even funerals in virtual worlds.[158] One funeral spurned heated Internet commotion when members of a hostile faction deliberately murdered every funeral attendee.[159] The murdered avatars’ anger, expressed on bulletin boards and across the Internet, reflects their community personhood interests in the virtual world.[160] The law should protect these community personhood interests.[161]
C. Utilitarian Theory: RMT–Prohibiting Provisions as Disincentives to New Businesses
Utilitarian property theorists suggest that the law recognizes private property interests where such recognition would promote the general welfare.[162] Jeremy Bentham’s utilitarian theory supports the idea that courts recognize a property interest in chattels secured in MMORPGEs. Generally, Benthamists balance pleasure and pain to determine what the law should or should not allow.[163] Bentham’s utilitarian theory argues that the law should promote property that provides the greatest good to the largest number of people.[164] Accordingly, if the law fails sufficiently to protect certain private property rights, the law therefore exacts harm on society.[165] Utilitarian theory prominently applies, for example, in nuisance law.[166]
MMORPG designers use their property to harm others when they take actions to prohibit RMT activity. Nuisance law, in which the law punishes the person who harms others with his or her property, attempts to cure this type of harm.[167] Courts interpret whether one person’s use of property constitutes a nuisance by applying a multifactor balancing test.[168] The test balances the gravity of the harm to the non–nuisance actor against the social utility of the nuisance actor’s conduct, to determine whether a particular property use constitutes a nuisance.[169] As discussed above, terminating player accounts to prohibit RMT activity eliminates property interests established when gamers and businesses inject their labor into MMORPGEs and business entities to engage in RMT activity.
Designers exact a grave harm on virtual world inhabitants when they systematically take measures to eliminate RMT activity. For example, if a player engages in RMT activity and a designer interferes by terminating accounts or shutting down the game server, the designer potentially destroys millions of dollars invested in the virtual world.[170] Moreover, engaging in RMT activity constitutes an exciting new type of business.[171] Allowing RMT activity encourages others to invest creatively in virtual worlds.[172] Persons engaged in RMT in World of Warcraft could not move to a title that allows RMT activity because the long–term abilities that their avatars acquire would not transfer to a different title.[173] Moving to another server or even another jurisdiction with more favorable RMT provisions could potentially cost years in avatar development.[174]
Actions to eliminate RMT activity lack social utility.[175] Designers do not act reasonably when they arbitrarily delete substantial investments and predicate that authority on an unconscionable contract provision.[176] Their conduct lacks social value because society should invest in creative business and cultural ventures in MMORPGEs. Although designers’ conduct is intuitively appropriate because they have a right to determine the rules of the game,[177] unprecedented participation in MMORPGEs makes RMT–prohibiting actions unsuitable. Finally, MMORPG designers like Blizzard can entirely avoid the harm by allowing RMT activity on some, but not all, of their servers, or provide a designer–run auction house.[178] As designers exact harm on the MMORPG community when they delete virtual assets or MMORPG accounts to terminate RMT activity, and because the social utility of that action does not justify the harm, designers fail to benefit the greatest number of people when enforcing RMT–prohibiting contract provisions.[179]
If the law fails to enforce a private property right in virtual chattels, gamers and entrepreneurs are less likely to invest in virtual worlds.[180] Linden Labs designed its Second Life virtual world to attract persons or entities desiring to invest in businesses in virtual worlds.[181] Eliminating the investments in that virtual world harms designers who intend to create similar worlds, as well as gamers or entrepreneurs looking for creative business projects.[182] Recognizing the fruits of a business invested in virtual world trade encourages other businesses to invest in MMORPGEs.[183] Moreover, if United States courts fail to recognize a “real world” property interest in chattels secured in–game, these businesses will move to jurisdictions that do.[184] Allowing RMT activity allows the United States to compete with other countries that grant substantial property rights in virtual property.[185]
III. MMORPG EULA Contracts: Virtually Enforceable, or Simply Unconscionable?
Gamers and businesses hold substantial property interests in virtual worlds. Designers typically predicate access to those worlds on EULA contracts. EULAs that contain provisions granting designers the right to terminate accounts or turn off the server assume a traditionally suspect contract form.[186] MMORPG EULA contracts typically constitute “clickwrap”[187] or “browsewrap”[188] agreements.[189] Since ProCD v. Zeidenberg,[190] courts typically hold these agreements enforceable.[191] However, this Article submits that courts should find MMORPG EULA provisions that prohibit RMT activity procedurally and substantively unconscionable because they eliminate substantial property interests.
In ProCD, plaintiff ProCD compiled phone numbers and addresses into an expansive database.[192] ProCD sold the database on CD–ROM disks covered in plastic wrap, or “shrinkwrap.”[193] The United States Court of Appeals for the Seventh Circuit held that a vendor could invite acceptance through opening and using the CD–ROM,[194] reasoning with the U.C.C. proclamation that “[a] contract for the sale of goods may be made in any manner sufficient to show agreement.”[195] Judge Easterbrook, writing for the ProCD court, subjected the Seventh Circuit’s holding to the U.C.C. rule that a buyer accepts goods when, “after an opportunity to inspect, he fails to make an effective rejection under § 2–602(1).”[196] Inasmuch as the contract allowed the buyer to inspect and return the product,[197] the court found the shrinkwrap agreement enforceable to the extent that it did not violate a contract law rule.[198]
Generally, courts have adhered to the Seventh Circuit rule, applying it to most electronic standard–form agreements,[199] and reversing where the contract permits no manifestation of assent.[200] Most MMORPGs implement a “clickwrap” agreement that presents the entire contract during the installation process.[201] The user must scroll through the document, at which point an “I Agree” button activates.[202] The user can click “I Agree” to proceed to software installation, or click “I Decline” to terminate the program.[203] Some MMORPGs require users to perform this review each time they sign into the environment,[204] while others require users to perform this review each time the software updates.[205] Courts apply the ProCD rule and enforce clickwrap agreements because the agreements allow a reasonable opportunity to review the document, require the user affirmatively to click “I agree” before using the software, and provide an opportunity to return the software should the purchaser refuse to agree.[206] Most MMORPG EULA contracts that prohibit RMT activity meet the floor established since ProCD.[207]
But since MMORPG EULAs contain provisions “objectionable on grounds applicable to contracts in general,”[208] courts should find that designers cannot rely on EULAs to prohibit increasingly common RMT activity.[209] In ProCD, neither party argued that the shrinkwrap license contained any generally objectionable terms, and the court therefore did not address this question.[210] Likewise, scholars have not addressed in detail whether courts will find terms that prohibit RMT activity unconscionable. The question merits investigation because courts can refuse to enforce as unconscionable the entire contract or a specific term or terms.[211]
Courts generally require both procedural and substantive unconscionability to find a contract provision unenforceable.[212] When assessing procedural unconscionability, courts look to how the parties formed an agreement, whether or not the contract contained long and complicated text or provisions, or whether the parties formed the contract under pressure.[213] Courts might consider the “age, education, intelligence, business acumen and experience of the parties, . . . relative bargaining power, the conspicuousness and comprehensibility of the contract language,[214] the oppressiveness of the terms,[215] and the presence or absence of a meaningful choice.”[216] Notably, courts have found a contract procedurally unconscionable if it constitutes a contract of adhesion.[217]
A contract of adhesion generally bears five qualities.[218] First, the contract appears on pre–printed forms included in the installation materials.[219] Second, it is used in consumer transactions in mass–market environments.[220] Third, it presents terms on a “take it or leave it” basis,[221] requiring an offeree to agree to the terms or forego the benefits of the contract.[222] Fourth, it is drafted in a generalized way,[223] and reflective of the party with superior bargaining powers’ interests.[224] Finally, the fact that the agreement constitutes a contract of adhesion does not necessarily render it procedurally and substantively unconscionable.[225]
Substantive unconscionability addresses the terms of the contract itself, and invalidates manifestly unfair provisions or clauses.[226] A substantively unconscionable contract term “shocks the conscience”[227] or egregiously and manifestly disadvantages the non–drafting party.[228] Both procedural and substantive unconscionability reflect the U.C.C. discussion of the term: “[t]he basic test is whether, in light of the general commercial needs of the particular trade or case, the clauses involved are so one–sided as to be unconscionable?”[229] Unconscionability “intentionally sets a high bar,”[230] and courts rarely find a contract term unconscionable.[231] A term more likely “shock[s] the conscience,”[232] however, as society more heavily invests in virtual worlds.[233]
MMORPG contracts that prohibit RMT activity clearly implicate the concerns engendered in the unconscionability doctrine. First, they constitute procedurally unconscionable contracts of adhesion. Many MMORPGs do not come in a box, many are not carried in traditional brick and mortar stores, and many are available only online.[234] If an MMORPG comes as software that a gamer purchases in a box, the outside of the box may include a disclaimer that software users must accept additional terms.[235] In the instance that an MMORPG has a manual, the designer likely prints the terms in the manual.[236] However, those understood terms change as the designer–gamer relationship develops, and the changing relationship does not necessarily reflect the current EULA, TOU, or TOS.[237]
A “clickwrap” or “browsewrap” license typically appears during the installation process.[238] A clickwrap agreement presents the EULA, TOU, or TOS in a window during the installation process.[239] The user is sometimes required to scroll through the entire text of the document before affirmatively clicking a button labeled “I agree” in order to proceed through the installation.[240] A browsewrap agreement presents a checkbox that the user must click to manifest assent in order to access a virtual world.[241] Next to the checkbox is a hyperlink that directs the installer to the text of the EULA, TOU, or TOS. Generally, courts enforce both types of agreements under ProCD,[242] even though consumers are less likely to view browsewrap license terms because they do not have to scroll through the agreement to proceed with installation.[243]
Both clickwrap and browsewrap formats constitute procedurally unconscionable contracts of adhesion when applied to MMORPGs. Common sense and personal experience remind us that most gamers do not read these contractual documents in their entirety.[244] The documents contain complicated legalese that the average gamer does not understand.[245] The documents are several pages long, and one document often requires that a gamer understand several other documents of equal length.[246] There is no negotiation, and gamers cannot modify the contracts. Without accepting the contracts’ terms, gamers cannot access the virtual environment.[247]
Gamers’ have no voice in contract formation: the only actively contracting party is the designer.[248] Designers can rely on their EULA, TOU, or TOS to defend their actions because the contracts contain broad, catch–all provisions.[249] To the extent that any gamers’ interest is represented in the contract, that interest is not the product of negotiation, but represents the designers’ decisions.[250] As such, MMORPG EULA contracts typically constitute procedurally unconscionable contracts of adhesion.[251]
Because courts analyze substantive unconscionability under a standard that asks whether a particular term shocks the court’s conscience, that determination will change as society becomes more invested in RMT activity.[252] Society presently invests, culturally and financially, in virtual worlds. Those investments will continue to increase as people and businesses explore virtual worlds and MMORPGEs. Courts should find provisions barring RMT egregiously unfair and substantively unconscionable.[253]
MMORPG designers increasingly encourage players to sell virtual chattels in RMT.[254] Sony recognized that it could not prohibit RMT activity, ultimately creating an online auction house for users to sell virtual chattels and currency for real money on certain servers.[255] Linden Lab encourages RMT activity in its Second Life environment.[256] The platform has proven wildly successful, and the population continues to increase rapidly.[257] Linden Lab provides an online currency exchange[258] and regularly sells virtual plots of land for thousands of dollars.[259] Large companies like MTV and ESPN actively incorporate their businesses into the Second Life environment.[260]
Some designers merely purport to grant gamers rights to virtual property secured in–game, both granting intellectual property rights to gamers and reserving the designers’ right to turn off their servers without liability.[261] Although Sony first banned RMT activity in Everquest,[262] it has since created an auction house where players can trade virtual objects for real money.[263] Ultima Online, a popular MMORPG, also encountered the widespread sale of virtual chattels on eBay and other auction houses.[264] The company chose to embrace the practice[265] in light of the rapidly increasing population of online gamers.[266]
Virtual currency, item, and character vendors abound on the Internet.[267] eBay dedicated a category to MMORPG chattels, currency, and characters.[268] Indeed, revenue derived from the virtual chattels sold in MMORPGEs is substantial.[269] For this reason, a designer eliminating these interests in a non–negotiated contract shocks the conscience.[270] Moreover, scholars and economists predict only increasing interest in virtual worlds, and to be subject to take–it–or–leave–it terms when such significant interests are at stake shocks the conscience.[271] Even when MMORPG designers purportedly grant gamers rights in their virtual property, designers often retain the right to delete such property without incurring liability.[272] Courts should find substantive unconscionability where designers attempt to regulate RMT through EULA contracts.
IV. Trespass to Gamers’ Virtual Chattels Secured in MMORPG Environments
Because MMORPG gamers acquire substantial property interests in virtual chattels secured in MMORPGEs, game designers destroy those chattels when they terminate accounts, turn off the server, or delete virtual assets pursuant to an RMT–prohibiting EULA. Part III argued that such behavior could not survive an unconscionability challenge. Absent this contractual hurdle, designers trespass on gamers’ chattels when they take such actions to prohibit RMT activity. Courts must be careful in defining the limits of gamers’ trepass to chattels cause of action to avoid anomalous results.
A. Applying the Cause of Action after Intel v. Hamidi [273]
Courts generally apply the Restatement definition where the chattel in question ultimately constitutes data on a hard drive or database.[274] According to that definition, a trespass to chattels occurs where one party “intentionally disposs[es] another of a chattel, or . . . us[es] or intermeddl[es] with a chattel in the possession of another.”[275] Liability results only if the trespasser dispossesses the possessor of the chattel, impairs the chattel’s condition, quality, or value, or deprives the possessor of the chattel for a substantial period.[276] As to the last option, the Restatement appears to not require physical, i.e., tangible, impairment.[277]
In eBay v. Bidder’s Edge,[278] the District Court for the Northern District of California applied the trespass to chattels doctrine to web spiders that retrieved data from databases owned by eBay.[279] The court concluded that the electronic communication between the spiders and eBay’s databases did not prevent the court from applying the trespass to chattels cause of action.[280] The court found Bidder’s Edge’s interference unauthorized,[281] and that Internet spiders “diminished the quality or value of eBay’s computer systems” within the meaning of the Restatement.[282]
Three years after eBay, in Intel v. Hamidi,[283] the California Supreme Court refused to find a trespass to chattels cause of action when an Intel employee repeatedly and without consent used Intel’s e–mail systems to send hundreds of thousands of e–mails to Intel employees.[284] The court stated that California’s laws on trespass to chattels do not—and should not—encompass an electronic communication that neither damages the recipient’s computer system nor impairs its functioning.[285]
Assuming that gamers have a legally cognizable property interest in virtual chattels secured in MMORPGEs,[286] designers commit trespass to chattels when they eliminate virtual assets to prevent RMT activity.[287] When a designer turns off his or her server, deletes assets or currency from that server, or deletes accounts to prohibit RMT activity, the designer—unlike Hamidi—deletes property owned by gamers or businesses entities engaged in virtual worlds.[288] The Intel court would have no trouble concluding that Hamidi committed trespass to chattels if he deleted valuable data on Intel’s servers.[289] Designers also eliminate fiscally valuable property interests when they delete gamer data.[290] This holding would recognize a new type of property interest and secure gamers’ rights against designers in MMORPGEs.
Courts could find, however, that gamers merely object to the content of designers’ actions and therefore cannot prove actionable harm.[291] The Intel court found that Intel’s complaint related predominantly to the content of Hamidi’s messages, rather than the chattel harm caused by those messages.[292] Intel proved no lost productivity resulting from Hamidi’s messages or any inability to use the e–mail system because of Hamidi’s messages.[293] Gamers or businesses entities that depend on virtual assets to continue in the ordinary course of play or business, however, lose productivity because they cannot continue their operations absent access to the virtual world. The court need not consider the tangibility of the property interest: designers clearly deny MMORPG participants use and possession in such instances. To the extent that the Intel court recognized that Intel actually objected to the content of Hamidi’s messages, a court could find that gamers actually object to the content of designers’ actions, without referencing harm.[294]
B. Crafting Limits to Trespass to Virtual Chattels: Excluding Intraworld Acts
Courts should carefully demarcate the limits to the trespass to chattels cause of action. In MMORPGEs, this would prevent subjecting both designers and gamers to unusual liability in MMORPGEs.[295] Expanding the trespass to chattels cause of action to encompass liability for acts occurring entirely within a virtual world would lead to anomalous results because many MMORPG platforms allow otherwise illegal activity.[296] For example, in Ultima Online, players can steal from others without violating the game rules.[297] In World of Warcraft, players regularly have the opportunity to steal, or “ninja,” items when playing with other players.[298] MMORPG platforms commonly encourage thievery, murder, group criminality, and other activity prohibited in the real world.[299]
Given that condition, it seems unreasonable for the law to allow one gamer to allege a trespass to chattels cause of action where the other gamer has acted entirely intraworld.[300] The trespass to chattels cause of action, applied to virtual chattels secured in–game, should encompass some act that begins outside the virtual environment but affects assets secured within the environment.[301] Designers who delete gamers’ accounts or assets to prevent RMT activity violate the rule: the deletion requires some real world action that externally affects the virtual world.[302] One player who steals a password or hacks into another player’s account violates this rule.[303] Courts must balance the inherent lawlessness of intraworld activity in MMORPGEs with the potential for anomalous trespass to chattels claims to encourage fruitful MMORPG development.[304]
The proposition that a trespass to virtual chattels cause of action necessarily encompasses an intra–world act emphatically highlights the struggle for legal scholars, and eventually the law, to understand how virtual worlds should fit within the rubric of American jurisprudence.[305] Should virtual worlds constitute jurisdictions of their own?[306] Should the First Amendment protect acts in a virtual world as speech, thereby pre–empting claims like trespass to chattels?[307] Should we wait for courts to address these issues or should the government regulate the contract terms that game designers present to gamers in an attempt to prevent gamers from entering into unconscionable contracts of adhesion?[308] Should federal or state governments criminalize behavior that occurs entirely within virtual worlds?[309] The inherent tension between gamers and designers’ interests must find a fair balance through the law.[310] Recognizing a trespass to chattels cause of action in certain intra–world circumstances constitutes one necessarily complex solution to that complicated problem.[311]
Virtual chattels have value as property that belongs to MMORPG gamers. Gamers and businesses inject their labor into MMORPGEs. Individuals and businesses bear constitutive and identificatory relationships with their avatars and the virtual chattels secured in MMORPGEs. Moreover, recognizing property interests in virtual chattels will create an incentive for businesses to invest in MMORPGEs, and for MMORPG designers to choose the United States instead of a more favorable jurisdiction. Given these property interests, MMORPG designers implement unconscionable EULA, TOS, and TOU contracts to prohibit RMT activity. In those contracts, designers may terminate accounts for engaging in RMT activity, or reserve the penultimate right to pull the plug on the virtual world. Considering MMORPG participants’ property interests and the unconscionable contracts designers employ to prevent RMT activity, courts should find that designers trespass upon gamers’ virtual chattels when they terminate accounts that engage in RMT activity. Nonetheless, courts must employ the trespass to chattels doctrine with caution to prevent anomalous results and to preserve the often desired lawlessness inherent in MMORPGEs.
* Associate Managing Editor, American University Law Review, Volume 57; J.D. Candidate, May 2008, American University, Washington College of Law; B.A., English, 2004, Boston College. Special thanks to the following individuals for their contributions to this thesis: Professor Mary Clark, for her invaluable guidance throughout the development of this topic, the staff members of the UC Davis Business Law Journal for their hard work in preparing this piece for publication, and my family and friends for their continued love and support.
[1] Raph Koster, A Declaration of the Rights of Avatars, http://www.raphkoster.com/gaming/playerrights.shtml (last visited Nov. 8, 2007).
[2] See Robert Hof, A Virtual World’s Real Dollars, Bus. Wk. Online, Mar. 28, 2006, http://www.businessweek.com/technology/content/mar2006/tc20060328_688225.htm?chan=technology_technology+index+page_more+of+today's+top+stories (describing financial appeal of building and selling, for real money, fictitious plots of land in three-dimensional, simulated virtual reality environment in which hundreds of thousands avatars reside).
[3] Shawn Elliot, Escort Mission, PC Mag., May 17, 2006, http://www.pcmag.com/article2/0,1895,1964618,00.asp (describing “Amster-Dame,” virtual red light district in Linden Lab’s Second Life virtual world, characterized by avatars that sell simulated sexual services from behind glass doors).
[4] See My Virtual Life, Bus. Wk., May 1, 2006, at 72 (examining Ansche Chung, avatar that established virtual real estate conglomerate that buys and sells plots of land in Second Life environment). The virtual real estate industry—buying and selling plots of land in virtual worlds—constitutes perhaps the most popular business enterprise in virtual worlds. See Paul Sloan, The Virtual Rockefeller, Business 2.0, Dec. 1, 2005, http://money.cnn.com/magazines/business2/business2_archive/2005/12/01/8364581/index.htm (explaining how Ansche Chung pays Linden lab about $200 per month, plus $1,250 one-time fee, for sixteen acre plots of virtual land that she develops using computer software or by hiring virtual subcontractors, and then sells or rents land to other Second Life residents).
[5] See Camille Dodero, Does Your Life Suck?, The Phoenix, July 17, 2006, http://www.thephoenix.com/article_ektid17440.aspx, for a comprehensive review of Linden Lab’s Second Life virtual world; see also Matt Gross, It’s My (Virtual) World and Welcome to It!, N.Y. Times, Nov. 3, 2006, at F1 (observing that users in Second Life can attend church in virtual environment); Michael Yessis, The Web Redefines Reality, USA Today, Nov. 15, 2006, at 9D (noting that Duran Duran hosts virtual concerts in Second Life environment).
[6] See David Pogue, An Experiment in Virtual Living, N.Y. Times, Feb. 22, 2007, at D01 (surveying personal and business ventures in Second Life).
[7] See Edward Castronova, Virtual Worlds: A First-Hand Account of Market and Society on the Cyberian Frontier, in 2 The Gruter Institute Working Papers on Law, Economics, and Evolutionary Biology 1 (2001), available at http://www.bepress.com/giwp/default/vol2/iss1/art1 [hereinafter Castronova, Cyberian Frontier] (defining virtual world as “the product of combining graphical 3D environment of games like Tomb Raider with chat-based social interaction systems developed in world of Multi-User Domains (MUDs)”); F. Gregory Lastowka & Dan Hunter, The Laws of Virtual Worlds, 92 Calif. L. Rev. 1, 5-6 (2004) [hereinafter Lastowka & Hunter, Laws of Virtual Worlds].
[8] See Caroline Bradley & A. Michael Froomkin, Virtual Worlds, Real Rules, 49 N.Y.L. Sch. L. Rev. 103, 121 (2005) (“Virtual worlds are more formally known as massively multi-player online role-playing games (“MMORPGs”)”).
[9] See Edward Castronova, The Price of “Man” and “Woman”: A Hedonic Pricing Model of Avatar Attributes in a Synthetic World 14 (CESifo Working Paper Series No. 957 2003), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=415043 (stating that avatar’s sex typically has no effect on its ability to acquire certain skills or abilities in virtual world, and that one in five MMORPG participants choose avatars of opposite sex).
[10] See Bradley & Froomkin, supra note 8, at 133 (describing “registered bond, promissory note, and commission agent” that facilitate land sale in MMORPG environment).
[11] David Smith, How to Get the Life You Really Want: Hundreds of Thousands of People Are Seeking Love, Fortune, and Happiness Through Their 2D Alter Egos in Second Life, a New Virtual World, The Observer(England), July 9, 2006, at 13; see Andrea L. Foster, Harvard to Offer Law Course in “Virtual World,” Chron. Higher Educ., Sept. 8, 2006, at 29 (justifying Harvard Law professor’s decision to teach class in Second Life environment on fact that architecture professors’ use environment to study building and design materials); Reena Jana, Starwood Hotels Explore Second Life First, Bus. Wk. Online, Aug. 23, 2006, http://www.businessweek.com/innovate/content/aug2006/id20060823_925270.htm (explaining how hotels can save money by first constructing potentially undesirable architectural or functional building elements in virtual world).
[12] See Bradley & Froomkin, supra note 8, at 132 (explaining how avatars make and sell shirts in Ultima Online MMORPG title).
[13] See James Grimmelmann, Virtual Worlds as Comparative Law, 49 N.Y.L. Sch. L. Rev. 147, 166 (2005) (positing that seasoned MMORPG avatars “signal their elite status” by acquiring rare items); see also Jack M. Balkin, Law and Liberty in Virtual Worlds, 49 N.Y.L. Sch. L. Rev. 63, 75 (2005) [hereinafter Balkin, Law and Liberty] (supporting claim that “defamation can occur in virtual worlds” by noting that reputation matters more as players continue to participate in same virtual world). Gamers acquire a constitutive relationship with their avatar identities, and reputation factors into that equation. See infra notes 139-42 and accompanying text (discussing why reputation implicates identity and why identity implicates legally cognizable property interests).
[14] Linden Lab not surprisingly titled its increasingly popular MMORPG environment “Second Life.” See infra notes 44-45 and accompanying text (explaining how avatars constitute “cyborg” identities that constitute extension of self and provide forum for, inter alia, creative self-expression).
[15] See Richard Siklos, A Virtual World But Real Money, N.Y. Times, Oct. 19, 2006, at C1 (identifying “big businesses” investing in Second Life environment, which is “fast becoming three-dimensional test bed for corporate marketers”); Giles Whittell, It’s Life But Not As We Know It As Web’s Future Takes Shape, Times (London), July 29, 2006, at 34 (describing real-world clothing producer American Apparel’s grand opening of “virtual mega-store” within Second Life environment).
[16] See Joshua A.T. Fairfield, Virtual Property, 85 B.U. L. Rev. 1047, 1048 (2005) (contending that law should apply traditional regulations and protections to computer code stimulating real world property); Andrew E. Jankowich, Property and Democracy in Virtual Worlds, 11 B.U. J. Sci. & Tech. L. 173, 176 (2005) (considering “questions of governance” in virtual worlds); Lastowka & Hunter, supra note 7, at 72 (arguing that virtual worlds constitute new jurisdictions with new laws); see also Jeremy Reimer, FBI, NCSoft Drop Hammer on MMORPG Pirates, Nov. 20, 2006, http://arstechnica.com/news.ars/post/20061120-8258.html (detailing “FBI sting” against fraudulent MMORPG servers).
[17] For an excellent history of online role-playing games and a broad review of related legal complexities, see Lastowka & Hunter, supra note 7, at 14-30 (reviewing MMORPG evolution from text-based online computer games to visual representational environments that persist when player exits game).
[18] See Edward Castronova, supra note 7, at 2, 3, 42 (concluding that at least $1,500,000,000 exchange hands in virtual worlds each year, and that virtual world in Sony’s Everquest had net worth greater than Bulgaria and higher gross national product per capita than India or China); Molly Stephens, Note, Sales of In-Game Assets: An Illustration of the Continuing Failure of Intellectual Property Law to Protect Digital-Content Creators, 80 Tex. L. Rev. 1513, 1514 (2002) (“The online-gaming market holds particular promise for investors because of potential market growth from the introduction of Internet-accessible game consoles and the emerging wide-spread availability of broadband access”).
[19] See Seth Schiesel, Online Game, Made in U.S., Seized the Globe, N.Y. Times, Sept. 5, 2006, at A1 (noting that Blizzard stands to reap over $1,000,000,000 in revenue and has 7,000,000 subscribers, making it one of most lucrative media properties of any kind); Nick Winfield, The Knights of Networking, Wall St. J., Oct. 5, 2006, at B1 (noting that Jagex Limited’s Runescape MMORPG has over 5,000,000 active players, 850,000 of whom pay five dollars per month to play).
[20] “Sony’s Everquest enjoys close to half a million subscribers in the U.S.” Beth Simone Noveck, The State of Play, 49 N.Y.L. Sch. L. Rev. 1, 8 (2004). Each subscriber pays a minimum fee of twelve dollars per month. Sony Entertainment, Accounts and Billing, http://everquestonlineadventures.station.sony.com/content.vm?page=Accounts%20and%20Billing (last visited Nov. 8, 2007).
[21] See Press Release, Blizzard Entertainment, World of Warcraft: The Burning Crusade Shatters Day-1 Sales Record (Mar. 30, 1998), available at http://www.blizzard.co.uk/press/070123.shtml (declaring that expansion to World of Warcraft environment “broke the day-one sales record to become the fastest-selling PC game ever”); Schiesel, supra note 19, at A1 (describing World of Warcraft as “one of the most lucrative media properties of any kind”). Blizzard declared that over nine million gamers subscribe to the World of Warcraft. Press Release, Blizzard Entertainment, World of Warcraft Surpasses 9 Million Subscribers Worldwide (July 24, 2007), available at http://www.blizzard.com/press/070724.shtml.
[22] Schiesel, supra note 19, at A1.
[23] See Blizzard Entertainment, General F.A.Q., http://worldofwarcraft.com/info/faq/general.html (last visited Nov. 8, 2007) (explaining one-time fifty dollar fee to purchase software and monthly charge that ranges from about thirteen to fifteen dollars per month).
[24] See Fairfield, supra note 16, at 1062 (valuing secondary market in virtual items at over $880,000,000, and noting rapid expansion).
[25] See Blizzard, General F.A.Q., supra note 23 (explaining that avatars in World of Warcraft use gold, silver, and copper virtual currency).
[26] See, e.g., EZgaming.com, Home Site, http://www.ezgaming.com/ (last visited Mar. 11, 2007) (offering virtual currency for, inter alia, World of Warcraft).
[27] See IGE, IGE Frequently Asked Questions, http://www.ige.com/FrequentlyAskedQuestions.aspx?lang=en&id=SellingCurrency (last visited Nov. 8, 2007) [hereinafter IGE FAQ] (offering to pay for virtual currency bank transfer, check, or money order).
[28] See Edward Castronova, Theory of the Avatar 3-4 (CESifo Working Paper Series No. 957, 2003), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=385103 (follow “Document Delivery” link) (“The physical representation of the self in virtual reality – the avatar – is an important aspect of the choice problem, as we would expect that people would gravitate toward those worlds that offer them their ideal avatars”).
[29] For an excellent description of this stage of transaction, and computer code behind it, see Molly Stephens, supra note 18, at 1516-19 (applying copyright analysis to computer code that transfers sword between avatars, and explaining relationship between designer server software and gamer client software).
[30] See, e.g., IGE, About Us, http://www.ige.com/about (last visited Mar. 11, 2007) (offering to purchase virtual currency from several MMORPGEs in exchange for real money, and offering to sell virtual currency at affordable prices).
[31] Square-Enix, Regarding Real Money Trade, http://www.playonline.com/ff11us/polnews/news3374.shtml (last visited Nov. 8, 2007) (defining “real money trade” and prohibiting gamers from selling “game currency, characters, or any other in-game items for real money or any other consideration for value”).
[32] See, e.g., Blizzard Entertainment, World of Warcraft Terms of Use Agreement 8, http://worldofwarcraft.com/legal/termsofuse.html (last visited Mar. 11, 2007) [hereinafter Blizzard, TOU] (prohibiting all RMT and third party programs that allow players more quickly to collect goods for purposes of engaging in RMT). Professor Jankowich concluded that 56.25% of MMORPGs surveyed prohibited players from selling virtual property acquired in-game. Jankowich, EULAw: The Complex Web of Corporate Rule-Making in Virtual Worlds, 8 Tul. J. Tech. & Intell. Prop. 1, 54 Annex A (2006) [hereinafter Jankowich EULAw].
[33] See Gary McGraw, When Does Security Cross the Line?, IT Architect, Dec. 1, 2005, at 106 (describing Blizzard’s “two pronged attack against cheaters”).
[34] See, e.g., Blizzard, World of Warcraft Accounts Closed, http://www.worldofwarcraft.com/news/wow-news-06-2006.html (last visited Nov. 8, 2007) (terminating accounts engaging in RMT).
[35] Posting of Florian Eckhardt to Kotaku, http://kotaku.com/gaming/world-of-warcraft/59000-gold-farmers-expelled-from-wow-190181.php (July 27, 2006).
[36] See, e.g., Davidson & Assoc. v. Jung, 422 F.3d 630, 640 (finding that gamers who developed alternate servers for Blizzard titles violated Digital Millennium Copyright Act’s circumvention provision).
[37] Id.
[38] See A.H. Rajani, Note, Davidson & Associates v. Jung: (Re)interpreting Access Controls, 21 Berkeley Tech. L.J. 365, 388 (2006) [hereinafter Rajani, Access Controls] (finding that game designers effectively have “secured the right to host their games exclusively”).
[39] See supra notes 21-22 and accompanying text.
[40] See supra notes 19-21 and accompanying text.
[41] See Jack M. Balkin, Virtual Liberty: Freedom to Design and Freedom to Play in Virtual Worlds, 90 Va. L. Rev. 2043, 2070-72 (2004) [hereinafter Balkin, Virtual Liberty] (predicting that commoditization of virtual property will result in litigation).
[42] See Greg Sandoval, Sony to Ban Sale of Online Characters From Its Popular Gaming Sites, CNET News.com, Apr. 10, 2000, http://www.news.com/Sony-to-ban-sale-of-online-characters-from-its-popular-gaming-sites/2100-1017_3-239052.html?tag=item (explaining that Sony was first to prohibit MMORPG character sale in 2000).
[43] See Fairfield, supra note 16, at 1084-85 (identifying “nascent regimes” in China and Taiwan that recognize property rights in virtual chattels, in addition to competing with those regimes in United States).
[44] See generally Castronova, supra note 28 (exploring identity relationships between gamers and avatars, and reasons that players choose avatars of opposite sex).
[45] See Blizzard Entertainment, World of Warcraft Manual 11-12 (2004).
[46] See id. at 14 (reminding players that game prohibits cross-faction communication).
[47] Id.
[48] Id.
[49] See, e.g., id. (selecting rogue class grants avatars abilities to hide from and pickpocket other characters).
[50] Id. at 20-21.
[51] Id.
[52] Id.
[53] See Jankowich, Property and Democracy, supra note 16, at 183 (“There's no shortage of realism in this game—the trouble is, many of the nonviolent activities in [Ultima Online] are realistic to the point of numbingly lifelike boredom: If you choose to be a tailor, you can make a passable living at it, but only after untold hours of repetitive sewing.” (quoting Amy Jo Kim, Killers Have More Fun, Wired, May 1998, http://www.wired.com/wired/archive/6.05/ultima.html (last visited Aug. 11, 2006)).
[54] Blizzard Entertainment, World of Warcraft Manual, supra note 45, at 96-103.
[55] Id. at 114.
[56] See Cory Ondrejka, Escaping the Gilded Cage: User Created Content and Building the Metaverse, 49 N.Y.L. Sch. L. Rev. 81, 99 (2004) (“PlayerAuctions, a site that grew as a result of eBay's ban on EverQuest items, boasts over 100,000 members”).
[57] See Jankowich, EULAw, supra note 32, at 5 (introducing such contracts as laws that “create private rules in the absence of effective jurisdiction by real world governments”).
[58] See id. at 10 (“These agreements, governed by real world law, are the primary instrument of law employed by proprietors in the virtual world”).
[59] See Richard Bartle, Virtual Liberty: Freedom to Design and Freedom to Play in Virtual Worlds, 90 Va. L. Rev. 2043, 2047-48 (2004) (arguing that game designers have freedom to design virtual worlds and establish its rules according to game designers’ intentions, and that this freedom implicates First Amendment freedom of speech).
[60] See Raph Koster, The Laws of Online World Design, Website, http://www.raphkoster.com/gaming/laws.shtml (last visited Mar. 11, 2007) (“A roleplay-mandated world is essentially going to have to be a fascist state”). Raph Koster is a Chief Creative Officer with Sony Entertainment who designs MMORPG titles. Id.
[61] See Jankowich, EULAw, supra note 32, at 11 (reminding that designers cannot incorporate all desired restrictions into MMORPG environment by including those restrictions in EULA). But cf. Lawrence Lessig, Code and Other Laws of Cyberspace 6 (2000) (arguing that on internet, “code is law,” and that neither designers nor law can regulate that which they cannot write as code).
[62] Compare Blizzard Entertainment, World of Warcraft Accounts Closed, June 9, 2006, http://www.worldofwarcraft.com/news/wow-news-06-2006.html (terminating over thirty thousand accounts and reminding that “selling World of Warcraft content, such as gold, items, and characters, can result in permanent bans of involved accounts from World of Warcraft”), and Square Enix, Final Fantasy XI User Agreement, July 1, 2004, 3.1(a), https://secure.playonline.com/supportus/index03.html (follow “FINAL FANTASY XI User Agreement” link) (prohibiting RMT transactions, virtual gambling, intellectual property right infringement, harassment, and cheating), with Linden Lab, IP Rights, http://www.secondlife.com/whatis/ip_rights.php (last visited Mar. 11, 2007) (“Linden Lab's Terms of Service agreement recognizes Residents' right to retain full intellectual property protection for the digital content they create in Second Life, including avatar characters, clothing, scripts, textures, objects and designs. This right is enforceable and applicable both in-world and offline, both for non-profit and commercial ventures. You create it, you own it—and it's yours to do with as you please”); Linden Lab, Terms of Service, 1.5, http://www.secondlife.com/corporate/tos.php (last visited July 10, 2006) [hereinafter Linden Lab, TOS] (providing currency exchange called LindeX, where players can transfer rights to Second Life virtual currency for real money), and There.com, Overview on Copyrights, http://info.there.com/idx/0/788/article/Overview_on_Copyrights.html (last visited Nov. 7, 2007) (granting intellectual property rights to “developer status” members but not to “basic members”).
[63] See, e.g., Anarchy Online, Rules of Conduct Within Anarchy Online, 6, http://anarchy-online.com/content/corporate/rulesofconduct.html (last visited Oct. 7, 2006) (“You will always follow the instructions of authorized personnel while in Anarchy Online.”), cited in Jankowich, EULAw, supra note 32, at 9; Blizzard, TOU, supra note 32, at 5(C)(3) (prohibiting “[a]nything that Blizzard considers contrary to ‘essence’ of World of Warcraft”).
[64] See Balkin, Law and Liberty, supra note 13, at 66 (“Although the freedom to play generally exists within the rules of the game, platform owners may run their spaces in ways that the players believe are unfair or tyrannical. As a result, claims about the platform owners’ freedom to design may clash with players' claims about the freedom to play, and the law may have to arbitrate between them”).
[65] See Balkin, Virtual Liberty, supra note 41, at 2050-51 (introducing “freedom to play,” “freedom to design,” and “freedom to design together”); see also Fairfield, supra note 16, at 1050 (“[H]olders of intellectual property rights have been systematically eliminating emerging virtual property rights by the use of contracts called [EULAs]”).
[66] See Jankowich, EULAw, supra note 32, at 54-57 Annex A (charting account, identity, speech, property, behavior, liability, privacy, and participant rights clauses in MMORPG EULAs).
[67] See, e.g., Blizzard, TOU, supra note 32, at 1(B) (requiring that participant provide his or her name, address, and phone number).
[68] See, e.g., id. at 3(A) (prohibiting, inter alia, user names that incorporate profanity).
[69] See, e.g., id. at 3(B)(ii) (prohibiting “[c]arry[ing] out any action with a disruptive effect” on chat screen).
[70] See Brian Chase, When the Pen is Mightier Than the (Magic) Sword, http://www.lambdalegal.org/our-work/publications/page.jsp?itemID=32007393 (last visited Oct. 7, 2006) (describing cease and desist letter sent to Blizzard after company suspended user who discussed sexuality in-game); see also Jose Antonio Vargas, For Gay Gamers, A Virtual Reality Check, Wash. Post, Mar. 11, 2006, at C01 (discussing lesbian, gay, bisexual, and transvestite MMORPG players).
[71] See Bradley & Froomkin, supra note 8, at 123 (discussing Ultima Online’s economy based on developing and improving property and trading goods). Time invested by economists researching economies of virtual worlds buttresses this legitimate designer interest. See Castronova, Cyberian Frontier, supra note 7, at 2 (noting that “economists and other social scientists will become interested in Norrath and similar virtual worlds as they realize that such places have begun to mean great deal to large numbers of ordinary people”).
[72] See Jankowich, EULAw, supra note 32, at 54 Annex A (noting that 56.25% of virtual worlds prohibit sale of virtual property); see also id. (noting that 72.92% of virtual world proprietors claim all intellectual property in virtual world).
[73] See id. (calculating that 95.83% of virtual worlds implement a property-based economy); see also Bradley & Froomkin, Virtual Worlds, Real Rules, supra note 8, at 133 (“No virtual world, not even a community-conscious, social MUD like LambdaMOO, has an entirely communal property system”).
[74] See Jankowich, EULAw, supra note 32, at 9 (coining term “EULAw” as body of contractual provisions that designers implement to impose real law limitations on virtual world activities).
[75] See Blizzard, TOU, supra note 32, at 8 (discussing how Blizzard does not recognize any property claims outside World of Warcraft or “the purported sale, gift or trade in the ‘real world’ of anything related to World of Warcraft”).
[76] See Jankowich, EULAw, supra note 32, at 54 Annex A (calculating that while 33.33% of proprietors claim all property, 72.92% claim all intellectual property).
[77] See Jankowich, EULAw, supra note 32, at 54 Annex A (calculating that 47.92% of proprietors prohibit software sale).
[78] See id. (finding that 41.67% of polled MMORPGEs allow designer to terminate world at will, and that virtual world proprietor can terminate participant’s account at its discretion).
[79] To the extent that an MMORPG EULA represents a designer interest in prohibiting RMT-activity, MMORPG EULAs undercut significant gamer investments in the world. See infra Part II (discussing how gamers have significant property interests in property secured in virtual worlds under Lockean, utilitarian, and personhood property theories).
[80] The virtual property inquiry is not limited to American jurisprudence. See infra notes 113-15 (discussing Chinese, Taiwanese, and Korean law and virtual property).
[81] See supra notes 21-22 and accompanying text.
[82] See, e.g., MMOBids.com, About Us, http://www.mmobids.com/aboutus.php (last visited Mar. 11, 2007); Lewt.com, About Us, http://www.lewt.com/about-us/ (last visited Mar. 11, 2007).
[83] See Edward Castronova, A Cost-Benefit Analysis of Real-Money Trade in the Products of Synthetic Economies, Info, Oct. 2006, available at http://ssrn.com/abstract=917124 (follow “Download Document” link) [hereinafter Castronova, Cost-Benefit Analysis] (predicting that increasing interest in online gaming would result in $100,000,000 in annual RMT); see also id. at 37 n.2 (projecting that online video game revenue will rise “from $1.9 billion in 2003 to $9.8 billion in 2009”).
[84] See Balkin, Virtual Liberty, supra note 41, at 2046 (arguing that increasing virtual property commoditization will result in increased potential legal regulations of virtual worlds).
[85] See id. at 2046-47 (hypothesizing First Amendment claims that result from tension between gamers’ freedom to play in virtual worlds, and designers’ freedom to design them, but finding that Congress must implement legislation to protect virtual speech interests).
[86] Courts overseas have ruled that virtual assets acquired in online gaming environments constitute legally cognizable property. See generally Fairfield, supra note 16, at 1084-89 (reviewing lawsuits, decisions, and regulations in China, Taiwan, and South Korea). But see infra Part IV (explicating how causes of action to protect virtual property rights must have constraints that prevent criminalizing entirely in-world activity conducted pursuant to game norms).
[87] Blacksnow Interactive v. Mythic Entertainment, Inc., No. 02-CV-00112 (C.D. Cal. filed 2002), cited in Julian Dibbell, The Unreal Estate Boom, Wired, Jan. 2003, http://www.juliandibbell.com/texts/blacksnow.html (briefing Mythic case).
[88] Dibbell, supra note 87.
[89] See id. (reminding that Dark Age gold piece and Russian ruble are comparably valuable).
[90] Id.
[91] Id.
[92] Id.
[93] Id.
[94] Bragg v. Linden Lab, No. CV-7606 (Pa. Magis. Dist. Ct. May 2, 2006).
[95] See Linden Lab, Makers of Second Life, http://lindenlab.com/ (last visited Oct. 7, 2006) (describing Second Life as “burgeoning new online society”).
[96] See Kathleen Craig, Second Life Land Deal Goes Sour, Wired, May 18, 2006, available at http://www.wired.com/news/culture/0,70909-0.html?tw=rss.index (calculating Bragg’s virtual property at about $3,900).
[97] Linden Lab, TOS, supra note 62, at 3.2.
[98] See id. at 2.6 (stating that users do not receive refund or exchange for any virtual property created in Second Life).
[99] See id. at 3.3 (declaring that participant owns no data that designer uses to represent gamer content).
[100] See Complaint at 1, Bragg v. Linden Lab, No. CV-7606 (Pa. Magis. Ct. May 2, 2006) (alleging “breach of contract, conversion, [and] interference with contractual relations”).
[101] See Linden Lab, TOS, supra note 62, at 2.6 (allowing Linden Lab to terminate gamer accounts without cause, warning, or process).
[102] See Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1003 (1984) (applying Locke’s Second Treatise and stating that property arises from labor), cited in Adam Mossoff, Locke’s Labor Lost, 9 U. Chi. L. Sch. Roundtable 155, 155 & 155 n.1 (2002) (claiming that Supreme Court has cited no other philosophy text as justifying legal proposition); Justin Hughes, The Philosophy of Intellectual Property, 77 Geo. L.J. 287, 351 (1988) (attaching Locke’s theory to “generations of students,” and applying labor theory to intellectual property interests).
[103] See Hughes, supra note 102, at 297 (explicating that bounty of goods that humans must convert through labor into property originates from God).
[104] See A. John Simmons, A Lockean Theory of Rights 222-23 (1992) (describing Locke’s labor-for-property thesis as “intuitive”); Daniel J. Caffarelli, Note, Crossing Virtual Lines: Trespass on the Internet, 5 B.U. J. Sci. & Tech. L. 6, para. 10 (1999) (“Conversely, all unclaimed resources belong to society in common”).
[105] See John Locke, Two Treatises on Government 128 (Mark Goldie, ed., 1993) (“The labour of his body, and work of his hands, we may say, are properly his.”).
[106] See id. at 137 (“Thus labor, in the beginning, gave right of property, wherever anyone was pleased to employ it, upon what was common, which remained, long while, far greater part, and is yet more than mankind makes use of”).
[107] See Hughes, supra note 102, at 297 (positing that labor can add value to goods simply by allowing humans to use them).
[108] See Locke, supra note 105, at 133 (stating that labor alters intrinsic value of thing because its value depends upon usefulness).
[109] See, e.g., Int’l News Serv. v. Assoc. Press, 248 U.S. 215, 239 (1918) (prohibiting that one “reap where it has not sown”).
[110] Pierson v. Post, 3 Cai. R. 175 (N.Y. Sup. Ct. 1805).
[111] See id. at 178 (recognizing property interest applicable to person who injects labor sufficient to wound, trap, or kill animal, but finding mere sight or pursuit insufficient to constitute property interest); City of San Marcos v. Tex. Comm’n on Envtl. Quality, 128 S.W.3d 264, 270 (2004) (applying Pierson v. Post rule of capture to groundwater). But cf. Pierson, 3. Cai. R. at 182 (Livingston, J., dissenting) (arguing that law should reward property interest to person who undertakes pursuit through “waste and unoccupied lands”).
[112] In Li Hongchen v. Beijing Arctic Ice Technology Development Co., appellate court ordered virtual property taken by third party returned to gamer and recognized that gamer owned his virtual chattels. See Fairfield, supra note 16, at 1085 (“The action quieted title in virtual property in its rightful”).
[113] On-Line Game Player Wins Virtual Properties Dispute, Xinhua General News Service, Dec. 19, 2003.
[114] Fairfield, supra note 16, at 1087. Taiwanese courts have ruled on virtual property theft, fraud, and robbery, causes of action defined by statute. See id. at 1087-88 (noting that authorities routinely prosecute under virtual property theft statute).
[115] Id. But cf. id. at 1061 (finding that in South Korea, where environment alone hosts 17,000,000 subscribers, attempts to resolve virtual property disputes by applying already existing criminal and antitrust laws).
[116] The facts in Pierson reflect similar circumstances in other MMORPGEs, where players hunt animals like foxes, skin and remove their hides, and acquire virtual currency.
[117] See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 46-47 (“And as anyone who has slaved over a virtual forge will tell you, creating virtual-world property can involve at least as much tedium as any real-world work”); see also Posting of Nick Yee to The Daedalus Project, http://www.nickyee.com/daedalus/archives/000891.php (January 11, 2005) (finding that MMORPG gamers spend more time playing in virtual worlds than watching television).
[118] See The End Is Virtually Nigh, Economist, Dec. 10, 2005 (“Devoted MMORPG fans spend dozens of hours a month building up their characters, and live what is, in effect, a parallel life in another world”). This participation sometimes harms real world relationships. See World of Warcraft Widows Website, http://games.groups.yahoo.com/group/WOW_widow/ (last visited Mar. 11, 2007) (providing group support services for persons whose significant others left them to play World of Warcraft).
[119] See, e.g., IGE, About Us, supra note 30 (allowing gamers to trade, buy, and sell virtual assets and currency, as part of effort to give gamers more avenues for enjoying MMORPG titles).
[120] See IGE, IGE FAQ, supra note 27 (offering to buy and sell virtual currency from and to gamers).
[121] Cf. Caffarelli, supra note 104, at ¶ 11 (“In the same way that landowner's improvements increase the value of real property, programmer's development of site increases value of Internet, or the specific address of newly created Web site”).
[122] Cf. id. (finding that property interest in web sites would render more valuable unused internet space).
[123] See Danny Bradbury, Virtual Insanity, The Independent (London), Aug. 9, 2006, at 8 (describing currency-farming operations in MMORPGEs that “repeat the same action in an infinite loop” to secure assets).
[124] For example, gamers mine ore in World of Warcraft from veins in the virtual earth. Once a player uses a mining vein, the vein disappears. However, the vein reappears after a certain period, at which point the player can mine ore again. See Caffarelli, supra note 104, at para. 11 (promoting property rights in web sites because web developers cannot exhaust common resources). But see id. (finding that law should recognize property interest in websites because new site does not infringe upon others’ rights in existing property). Designers have property interest in virtual world, especially in that they created it. However, designers cannot deny gamers’ rights to property secured in-game as society continues to invest in RMT activities.
[125] See Simmons, supra note 104, at 242-43 (explaining that prior rights each person possesses in his or her person, mixed through labor with unowned commons, constitutes property).
[126] Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 38.
[127] See, e.g., IGE Home Page, http://www.ige.com/ (last visited October 16, 2007) [hereinafter IGE, Home Page] (allowing visitors to buy, sell, trade, and donate virtual assets in eight MMORPGEs).
[128] See Eye on MOGs Home Page, http://www.eyeonmogs.com/ (last visited October 16, 2007) (offering virtual chattels from thirty-two games, from twenty-four providers, in 81,635 separate listings).
[129] Mike Musgrove, Virtual Gaming Economy, Wash. Post, Sept. 20, 2006, at A1.
[130] See infra Part II.C and accompanying text (arguing for utilitarian justification for MMORPG virtual property).
[131] Margaret Jane Radin, Property and Personhood, 34 Stan. L. Rev. 957, 958 (1981).
[132] Id. at 957.
[133] See Caffarelli, supra note 104, at ¶ 14 (interpreting Radin’s theory as focused on an individual’s ability to control “the resources in her environment [in order] to develop completely as a person”); Radin, Property and Personhood, supra note 131, at 959-60 (identifying house or wedding ring as property with which an individual has constitutive relationship).
[134] Radin, Property and Personhood, supra note 131, at 959; cf. Caffarelli, supra note 104, at 959 (noting that amount of pain person experiences “provides a measure of the strength of the connection between the person and the property” and applying that theory to justify property interest in websites).
[135] See Caffarelli, supra note 104, at ¶¶ 14-15 (concluding that law should grant broad private property rights where property defines one’s personhood).
[136] See Bleistein v. Donaldson Lithographing Co., 188 U.S. 239, 250 (1903) (finding that “a very modest grade of art has in it something irreducible, which is one man’s alone . . . [t]hat something he may copyright”). American copyright law constitutes one enduring example of personality operating as a justification for law in the United States. See Hughes, supra note 102, at 351 (1988) (noting that copyright law protects owners’ rights to have public recognize their identity as creator, and creates right to protect creation from changes that might injure author’s reputation).
[137] See Javins v. First Nat’l Realty Corp., 428 F.2d 1071, 1077 (1970) (finding common law obligation that landlord maintain his or her premises in habitable condition by incorporating contract law theories).
[138] See Susan P. Crawford, Who’s In Charge of Who I Am?: Identity and Law Online, 1 N.Y.L. Sch. L. Rev. 211, 214 (2004) (recognizing that identity constitutes product of world that individual inhabits); see also Richard Bartle, Designing Virtual Worlds 159 (New Riders Games 2003) (declaring identity “absolutely core point of virtual worlds”).
[139] See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 63 (explaining that an avatar can allow its controller to experiment with identity, expression, and desire). MTV currently beta tests its own virtual world, Virtual Laguna Beach. See Richard Siklos, Not in the Real World Anymore, N.Y. Times, Sept. 18, 2006 (detailing MTV’s plan to allow gamers to engage virtual environment where they assume likeness of young, wealthy character from popular reality television series).
[140] See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 65 (reminding that while avatars constitute “masks,” gamers do not consider their avatars completely distinct from their real identities).
[141] See Crawford, supra note 138, at 213 (defining identity as a product of others’ perceptions).
[142] See id. (“Identity and reputation go hand in hand, as individuals gain reputations that are connected to particular contexts and groups”).
[143] See Cameron England, Like WoW Wipeout, The Advertiser (Australia), June 23, 2006, at 19 (describing suspended death sentence issued by Shanghai court when Legend of Mir 3 gamer stabbed another player to death after he stole and sold murderer's virtual sword for reported $1175); see also Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 63-64 (describing gamers’ real anger and humiliation when his or her avatar receives representational injury).
[144] That players may elect to sell the items with which they have an important constitutive relationship does not denigrate their personhood interest in virtual property. While homes constitute archetypal personhood interests, persons nonetheless elect to sell their homes. See Radin, Property and Personhood, supra note 131, at 959-60 (discussing pain experienced with loss of home). When Blizzard recently created an “Armory” that allows any player to view all the possessions and skills of another player by using a website, many players reacted by objecting to an invasion of their privacy, while others countered that gamers have no valid objection where they do not on the data that constitutes their character. Compare Posting of Selenia to http://forums.worldofwarcraft.com/thread.html?topicId=79628029&sid=1&pageNo=27 (last visited Mar. 10, 2007) (“Violated is exactly how I feel.”), with Posting of Kharthus to http://forums.worldofwarcraft.com/thread.html?topicId=79628029&sid=1&pageNo=27 (last visited Mar. 10, 2007) (“The data was never yours to begin with and hence privacy doesn’t even come into play”).
[145] See Mary L. Clark, Reconstructing the World Trade Center: An Argument for the Applicability of Personhood Theory to Commercial Property Ownership and Use, 109 Penn St. L. Rev. 815, 821-22 (2005) [hereinafter Clark, World Trade Center] (describing workplace as “home away from home”). The law recognizes that businesses acquire personhood interests when it grants copyright protections to business entities. See Bleistein v. Donaldson Lithographing Co., 188 U.S. 239, 250 (1903) (recognizing that personality justified copyright protections, and extending those protections to multiple plaintiffs).
[146] See Clark, World Trade Center, supra note 145, at 822 (“The emphasis on the personhood implications of realizing personal goals through property is no less true of commercial property than personal property, and should be recognized by the law as playing a critical role in both realms”).
[147] Id. at 821.
[148] See Posting of Jun-Sok Huhh to Virtual Economy Research Network, http://virtual-economy.org/blog/ (follow “IGE, Ready to sweep the Korean RMT market?” link) (Sept. 6, 2006, 11:45) (explaining how virtual chattels conglomerate IGE recently purchased Korean RMT business for about $4,700,000).
[149] See My Virtual Life, supra note 4 (explaining how the virtual real estate mogul recently opened ten person offices in Wuhan, China, to manage over $250,000 in virtual asset holdings).
[150] See, e.g., IGE, Home Page, supra note 127 (offering chattels and currency in sixteen different MMORPG titles).
[151] See Sony Entertainment, Station Exchange: The Official Secure Marketplace for EverQuest II Players, http://stationexchange.station.sony.com (last visited Mar. 11, 2007) (opening designer-sanctioned online auction for “the right to use in-game coin, items, and characters”); cf. UO Game Code Store, http://www.uogamecodes.com/store/prod_detail.asp?ProdID=UOADVCHAR (last visited October 3, 2006) (allowing Ultima Online players to purchase advanced avatars to avoid playing for hours to secure rare virtual artifacts or large amounts of currency). One student characterized Sony’s decision as an “about-face.” Rajani, Access Controls, supra note 38, at 392.
[152] See Richard A. Bartle, Virtual Wordliness: What the Imaginary Asks of the Real, 49 N.Y.L. Sch. L. Rev. 19, 27 (2004) (noting that if designers did not retain exclusive rights over virtual world, world would become outdated and overrun with system exploits).
[153] See Balkin, Law and Liberty, supra note 13, at 64-65 (describing designers’ “freedom to design” virtual worlds, and players “freedom to play” within designers’ vision). Balkin defines right to play as contingent upon and constituted by the right to design. Id.
[154] See Blizzard, TOU, supra note 32, at 3(C)(v) (prohibiting anything contrary to “essence” of World of Warcraft). Blizzard also recognizes community personhood interests when it claims that RMT activity constitutes cheating and unfairly treats other gamers. See Blizzard Entertainment, Selling World of Warcraft In-Game Content for Real Money, Dec. 10, 2004, http://www.worldofwarcraft.com/news/wow-news2004.html (discouraging RMT to avoid damaging “the overall experience” for other gamers).
[155] See Blizzard, TOU, supra note 32, at 3(C)(8) (last visited Aug. 11, 2006) (“Note that Blizzard Entertainment either owns, or has exclusively licensed, all of the content which appears in World of Warcraft.”).
[156] See Clark, World Trade Center, supra note 145, at 823, 827-28 (concluding that decommodification of land representing original World Trade Center tower footprints recognizes personhood attachments of persons who worked and died there).
[157] Cf. Mary L. Clark, Keep Your Hands Off My (Dead) Body: A Critique of the Ways in Which the State Disrupts the Personhood Interests of the Deceased and His or Her Kin in Disposing of the Dead and Assigning Identity in Death, 58 Rutgers L. Rev. 45, 71-72 (2005) (finding an offense to personhood interests where state requires deceased’s designee to pay embalming costs, without regard to either party’s “sense of bodily and spiritual integrity”).
[158] See Dominic Rushe, Fantasy Game Turns Internet into Goldmine, Sunday Times (London), Sept. 17, 2006, at 9 (describing planned online funeral service for Australian television star Steve Irwin).
[159] See Steven Levy, Living a Virtual Life, Newsweek, Sept. 18, 2006, at 48 (describing funeral killings as “questionable” and quoting Blizzard’s president discrediting action).
[160] See id. (noting that 80,000 people have viewed funeral video footage on YouTube). Comments following YouTube footage debate whether or not assaulting a virtual funeral causes real pain. Compare Posting of RMacPac to YouTube, http://youtube.com/watch?v=0OXlKCTn2_0 (last visited Oct. 4, 2006) (appreciating funeral attempt but noting that “it’s a game”), with Posting of Venomavp to YouTube, http://youtube.com/comment_servlet?all_comments&v=0OXlKCTn2_0&fromurl=/watch%3Fv%3D0OXlKCTn2_0 (last visited Oct. 4, 2006) (“It seems pathetic that honor and respect is generated by disrespecting and disturbing an emotional event”).
[161] See Clark, World Trade Center, supra note 145, at 823, 827-28.
[162] Bentham’s principle does not constitute an enigma in American law. See, e.g., U.S. Const. art. I, § 8 (“The Congress shall have power to . . . provide for the common defense and general welfare of the United States”).
[163] See Jeremy Bentham, The Theory of Legislation 113 (C. K. Ogden ed., Richard Hildreth trans., 1950) (1802) (reasoning that property constitutes legal construction, not natural right, such that security in property results when something does not confuse or complicate our expectations founded upon law), cited in Caffarelli, supra note 104, at ¶ 12.
[164] J. Bentham, A Fragment on Government, in 1 The Works of Jeremy Bentham 221, 227 (J. Bowring ed. 1962).
[165] See Bentham, supra note 163, at 113 (explaining that when legislator disturbs legitimate expectations about property, “he always produces a proportionate sum of evil”).
[166] Nuisance law draws on the principle sic utere tuo et alienum non laedas, which warns against using one’s property so as to harm another, to prevent certain property uses that society finds unappealing. See Prah v. Maretti, 108 Wis.2d 223, 252 (1982) (finding proposed home construction to constitute nuisance that would preclude sun from reaching plaintiff’s solar heating panels). Courts apply an ad hoc, fact-specific balancing test that weighs the gravity of the harm to the non-nuisance actor against the social utility of the nuisance actor’s conduct. See Spur Indus. v. Del Webb Dev. Co., 108 Ariz. 178, 184 (1972) (finding defendant’s cattle feeding lots, owned before plaintiff constructed residential development, constituted public and private nuisance because defendant’s feedlots created odor, flies, and affected public’s health). The Spur court required the plaintiff to indemnify the defendant because the plaintiff “brought people to the nuisance.” Id. at 186. To the extent that gamers come into the nuisance by knowingly engaging in RMT where an EULA prohibits such activity, gamers indemnify designers by paying monthly subscription fees to use the service. See id. (requiring that Spur move “not because of any wrongdoing[,] . . . but because of a proper and legitimate regard of the courts for the rights and interests of the public”); Restatement (Second) of Torts § 821F cmt. e (including location and characteristics of community in nuisance calculations).
[167] See Herbert Hovenkamp & Sheldon F. Kurtz, The Law of Property § 11.1 (5th ed. 2001) (“The essential basis for liability in a private nuisance action is the interference with [another’s] use and enjoyment of land”). Some scholars argue that the primary justification for intellectual property law has utilitarian roots. See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 44-45 (arguing that scholars who debate whether American law too broadly or too narrowly grants intellectual property rights implement Bentham’s felicific calculus).
[168] Hovenkamp & Kurtz, supra note 167, § 11.1.
[169] See Prah, 108 Wis.2d at 231 (explicating that “the defendant’s privilege of making a reasonable use of his own property for his own benefit and conducting his affairs in his own way” is correlatively related to “plaintiff’s right to use and enjoy his premises,” thereby mandating that courts make “a comparative evaluation of the conflicting interests” at stake (citing Prosser, Law of Torts § 89 (2d ed. 1971))).
[170] See supra note 18 and accompanying text.
[171] See, e.g., Andrew Lavallee, Now, Virtual Fashion, Wall St. J., Sept. 22, 2006, at B1 (explaining that top twenty Second Life residents who sell virtual garments secured $140,466 in nonvirtual profits).
[172] See Charles Nesson, Rebecca Nesson, & Gene Koo, CyberOne: Law in the Court of Public Opinion, September 22, 2006, http://blogs.law.harvard.edu/cyberone (hosting law school class in Second Life virtual world).
[173] See Balkin, Virtual Liberty, supra note 41, at 66 (“Although players make the initial choice of where to play, over time they often invest considerable time and energy in the game world and in their in-world identities”); James Grimmelman, Virtual Power Politics 8 (2005), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=707301#PaperDownload (“Ultimately, players’ power over designers depends on their ability go nuclear, to stop playing and stop paying. It’s a powerful threat, but costly for a player who has built up substantial in-game wealth or status, and each player can only quit once”).
[174] Grimmelman, supra note 173, at 8.
[175] See supra notes 173-74.
[176] Cf. Prah v. Maretti, 108 Wis.2d 223, 231(1982) (finding that obstruction of access to light could constitute private nuisance). But cf. Fontainebleau Hotel Corp. v. Forty-Five Twenty-Five, Inc., 114 So. 2d 357, 360-61 (Fla. Dist. Ct. App. 1959) (finding no property right in light and air, and no nuisance in erecting building that cast shadow over adjacent beachside hotel).
[177] See Balkin, Virtual Liberty, supra note 41, at 65 (positing that designers create and enforce rules through EULA contracts).
[178] Sony elected to create certain “shards,” or servers for its Everquest platform, that allow RMT activity. See infra notes 256 and accompanying text.
[179] Cf. Caffarelli, supra note 104, ¶ 13 (applying Benthamist principles to conclude that laws that promote personal property interest in websites provide security to site owners, provide incentive to others interested in investing in websites, and encourage creative expansion of internet).
[180] See Fairfield, supra note 16, at 1063 (finding that virtual environments fail to confer benefit on society if law fails to protect property interest in virtual property).
[181] See Linden Lab, The Marketplace, available at http://secondlife.com/whatis/marketplace.php (last visited Oct. 7, 2006) (“Second life has a fully-integrated economy architected to reward risk, innovation, and craftsmanship”).
[182] See Fairfield, supra note 16, at 1089 (concluding, after reviewing emerging codified and judicial virtual property regimes in other countries, that number of people invested in virtual worlds will increase, that virtual property law creates investment incentives for virtual world residents, that those residents will chose country most favorable to virtual property rights to host their businesses, and that designers will continue to abuse, through lobbying power, their monopoly on virtual worlds).
[183] See id. (reviewing foreign property regimes and concluding that more businesses will invest in virtual property ventures).
[184] See id. at 1085-1086 (describing MMORPG chattel-friendly property law regimes in China as “an integral part of the Chinese government’s initiative to build a competitive virtual world industry” in which businesses would thrive).
[185] Id.
[186] See, e.g., Step Saver Data Sys., Inc. v. Wyse Tech., 939 F.2d 91 (3d Cir. 1991) (finding unenforceable standard-form, box top license that did not require assent).
[187] See Robert F. Hillman & Jeffrey J. Rachlinski, Standard-Form Contracting in the Electronic Age, 77 N.Y.U. L. Rev. 429, 431 (2002) (defining clickwrap agreements); see also Robert L. Oakley, Fairness in Electronic Contracting: Minimum Standards for Non-Negotiated Contracts, 42 Hous. L. Rev. 1041, 1051 (2005) (“[C]lickwrap licenses are an improvement over shrinkwrap agreements, because they do at least require some affirmative action to indicate assent”).
[188] See Oakley, supra note 187, at 1052-53 (describing browsewrap contracts).
[189] “Shrinkwrap” interchangeably references either “browsewrap” or “clickwrap” agreements. Id. at 1050.
[190] ProCD, Inc. v. Zeidenberg, 86 F.3d 1447 (7th Cir. 1996).
[191] See i.Lan. Sys., Inc. v. Netscout Serv. Level Corp., 183 F. Supp. 2d 328 (D. Mass 2002) (finding clickwraps enforceable under Massachusetts law); In re RealNetworks, Inc., Privacy Litigation, 2000 WL 631341 (N.D. Ill. May 8, 2000) (finding browsewrap license enforceable).
[192] ProCD, 86 F.3d at 1449.
[193] Id.; see Oakley, supra note 187, at 1050 (describing shrinkwrap contracts); id. at 1059 (suggesting that ProCD contract might constitute a browsewrap or clickwrap license because it appears each time user runs software). Because commercial users valued the database more than customers who intended the product for commercial use, ProCD declared on the outside of the box sold to non-commercial users that the software subjected the purchaser to restrictions included in the packaging. ProCD, 86 F.3d at 1449. Those restrictions prohibited commercial use of the CD-ROM by non-commercial users. Id. at 1450. Defendant Zeidenberg purchased a consumer version of the product, ignored the license, and created a company that re-sold the information in the database. Id. Zeidenberg breached the contract but argued that the court should find it unconscionable. Id.
[194] ProCD, 86 F.3d at 1452.
[195] Id. at 1452; U.C.C. § 2-204(1).
[196] U.C.C. § 2-606(1)(b); see U.C.C. § 2-602(1) (“Rejection of goods must be within a reasonable time after their delivery or tender. It is ineffective unless the buyer seasonably notifies the seller”).
[197] ProCD, 86 F.3d at 1453.
[198] See id. at 1449 (“Shrinkwrap licenses are enforceable unless their terms are objectionable on grounds applicable to contracts in general”).
[199] See, e.g., Hill v. Gateway 2000, Inc., 105 F.3d 1147, 1150-51 (7th Cir. 1997) (enforcing arbitration clause in contract terms included inside shipping box); In Re RealNetworks, Inc., Privacy Litigation, No. 00 C 1366, at *1 (N.D. Ill. 2000) (applying ProCD to browsewrap license); cf. Specht v. Netscape Commc’ns Corp., 306 F.3d 17, 22 (2d Cir. 2002) (implying that browsewrap license arbitration clause applies to programs mentioned in contract, but not to other programs included in installation). But see Klocek v. Gateway, Inc., 104 F. Supp. 2d 1332, 1341 (D. Kan. 2000) (finding that purchaser did not accept standard agreement located inside computer packaging).
[200] A contract that excludes a manifestation of consent is uncommon. See U.C.C. § 2-204(1) (“A contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract”). Courts have reversed where one party sued to enforce a contract that did not mention the specific program subject to the litigation. See Specht, 306 F.3d at 22.
[201] See generally Oakley, supra note 187, at 1050 (describing clickwrap licenses and comparing them to browsewrap licenses).
[202] See Oakley, supra note 187, at 1060 (“Clearly, opportunity to review the document before being bound, opportunity to return if the terms are unacceptable, and some manifestation of assent are now important parts of finding a valid agreement”).
[203] Id.
[204] See Jankowich, EULAw, supra note 32, at 15 (citing Sony’s Everquest as example).
[205] Designers less likely employ this type of repetition. See id. at 15-16 (finding, generally, deceptive trend in EULA presentation, and minimal opportunities for consumer review).
[206] See i.Lan Sys., Inc. v. NetScout Serv. Level Corp., 183 F. Supp. 2d 328, 338 (D. Mass. 2002) (enforcing clickwrap license where agreement appeared before software installation); Oakley, supra note 187, 1060 (emphasizing assent requirement). Whether or not courts would find these agreements unconscionable remained an open question after ProCD. Id.
[207] See ProCD v. Zeidenberg, 86 F.3d 1447, 1449 (7th Cir. 1996) (enforcing shrinkwrap agreement).
[208] Id.
[209] See supra note 184 (predicting future investments in MMORPGEs).
[210] ProCD, 86 F.3d at 1449 (7th Cir. 1996).
[211] See U.C.C. § 2-302(1) (“If the court as a matter of law finds the contract or any term of the contract to have been unconscionable at the time it as made, the court may refuse to enforce the contract, or it may enforce the remainder of the contract without the unconscionable term, or it may so limit the application of any unconscionable term to avoid any unconscionable result”).
[212] See Nelson v. McGoldrick, 871 P.2d 177 (Wash. Ct. App. 1994); Oakley, supra note 187, at 1062 (implying that courts generally look for both types of unconscionability); Seungwoo Son, Can Black Dot (Shrinkwrap) Licenses Override Federal Reverse Engineering Rights?: The Relationship Between Copyright, Contract, and Antitrust Laws, 6 Tul. J. Tech. & Intell. Prop. 63, 121 (2004) (noting Professor Leff’s distinction that procedural unconscionability indicates “bargaining naughtiness,” while substantive unconscionability refers to “gross overall imbalance”). But cf. Brower v. Gateway 2000, Inc., 676 N.Y.S.2d 569, 574 (N.Y. App. Div. 1998) (stating that procedural unconscionability is not necessary); 7-29 Corbin on Contracts § 29.1 (stating that there is no requirement that court find both substantive and procedural unconscionability).
[213] Oakley, supra note 187, at 1063.
[214] See Jankowich, EULAw, supra note 32, at 12 (discussing MMORPG EULAs in terms of “complexity” and “accessibility”).
[215] See Ingle v. Circuit City Stores, Inc., 328 F.3d 1165, 1171 (9th Cir. 2005) (“A contract is oppressive if an inequality of bargaining power between the parties precludes the weaker party from enjoying a meaningful opportunity to negotiate and choose the terms of the contract”).
[216] 7-29 Corbin on Contracts § 29.1 (quoting NEC Techs., Inc. v. Nelson, 478 S.E.2d 769, 771-72 (Ga. 1996) (citations omitted)).
[217] E.g., Comb v. Paypal, Inc., 218 F. Supp. 2d 1165, 1172 (N.D. Cal. 2002); see Todd D. Rakoff, Contracts of Adhesion: An Essay in Reconstruction, 96 Harv. L. Rev. 1174, 1175-76 (1983) (suggesting that “more frequent use of the concept of unconscionability” might result in consistent treatment of contracts of adhesion); cf. Pollstar v. Gigmania, Ltd., 170 F. Supp. 2d 974, 981-82 (E.D. Cal. 2000) (looking to whether contract term is “buried in fine print” and “whether the user is given [an] ample opportunity to understand”). Much of the language that describes a contract of adhesion mimics the language that describes procedural unconscionability. See 1-1 Corbin on Contracts § 1.4 (noting that contracts of adhesion might contain “incomprehensible and intentionally obfuscating language,” implement “oppressive terms,” and have high potential for abuse by parties with superior bargaining power).
[218] See Oakley, supra note 187, at 1053; Arthur Lenhoff, Contracts of Adhesion and Freedom of Contracts: A Comparative Study in the Light of American and Foreign Law, 36 Tul. L. Rev. 481, 481-82 (1962) (reviewing elements of contracts of adhesion).
[219] Oakley, supra note 187, at 481-82.
[220] Id.
[221] See Vault v. Quaid Software, Ltd., 655 F. Supp. 750, 760 (E.D. La. 1987) (identifying an adhesive take-it-or-leave-it choice-of-law provision).
[222] See id. (noting that contracts of adhesion are “unilaterally drafted”).
[223] Id.
[224] Id.
[225] See Rakoff, Contracts of Adhesion, supra note 217, at 1175 (noting that “there is little agreement on what principles should control” contracts of adhesion); see also 1-1 Corbin on Contracts § 1.4 (reminding that “there are important advantages” to contracts of adhesion, including that “[t]he standardization of forms for contracts is a rational and economically efficient response to the rapidity of market transactions and the high cost of negotiations”).
[226] See, e.g., Brower v. Gateway 2000, 246 A.D.2d 246, 254 (finding that traveling costs necessary to comply with forum-selection clause unreasonably favor one party).
[227] Davidson & Assocs. v. Internet Gateway, 334 F. Supp. 1164, 1180 (E.D. Mo. 2004), aff’d Davidson Assocs. v. Jung, 422 F.3d 630 (8th Cir. 2005).
[228] See, e.g., id. (finding EULA and TOU not unconscionable where it did not impose “harsh or oppressive terms”).
[229] U.C.C. § 2-302 cmt. 1.
[230] Oakley, supra note 187, at 1063.
[231] Id. at 1062. But see, Ingle v. Circuit City Stores, Inc., 328 F.3d 1165, 1172-73 (finding procedural and substantive unconscionability where arbitration agreement included seven “one-sided” provisions).
[232] Davidson, 334 F. Supp. at 1180.
[233] See A & M Produce Co. v. FMC Corp., 135 Cal. Rptr. 114, 120 (1982) (describing unconscionability as “flexible doctrine designed to allow courts to directly consider numerous factors”), cited in 7-29 Corbin on Contracts § 29.1.
[234] See Jankowich, EULAw, supra note 32, at 15 (noting MMORPG gamers must review documents for changes because many virtual world proprietors reserve right to change contract terms without notice).
[235] See, e.g., Blizzard Entertainment, World of Warcraft Box (2004) (“The use of this product is subject to the terms in the End User License, which you must accept before you install this product”); ProCD v. Zeidenberg, 86 F.3d 1447, 1449 (7th Cir. 1996) (noting that purchaser could see license without opening box).
[236] Blizzard Entertainment, World of Warcraft Manual, supra note 45, at 1.
[237] The most recent World of Warcraft EULA is less than three months old. Blizzard, World of Warcraft EULA, June 1, 2006, http://www.worldofwarcraft.com/legal/eula.html [hereinafter Blizzard, EULA].
[238] Courts and scholars employ the term “shrinkwrap” often to describe both clickwrap and browsewrap licenses. ProCD v. Zeidenberg, 86 F.3d 1447, 1050 (7th Cir. 1996).
[239] See Specht v. Netscape Communs. Corp., 306 F.3d 17, 22 n.4 (2d Cir. 2002) (defining clickwrap agreements).
[240] Id.
[241] See Tarra Zynda, Note, Ticketmaster Corp. v. Tickets.com, Inc.: Preserving Minimum Requirements of Contract on the Internet, 19 Berkeley Tech. L.J. 495, 507-08 (2004) (adding that browsewrap licenses are suspect because they do not require user to view contract, and sometimes avoid assent requirements).
[242] See id. at 507 (noting that “the U.C.C. and case law generally support the enforceability” of clickwrap licenses).
[243] Id. at 507-08.
[244] See Tal Z. Zarsky, Information Privacy in Virtual Worlds: Identifying Unique Concerns Beyond the Online and Offline Worlds, 49 N.Y.L. Sch. L. Rev. 231, 265 (observing that most users don’t read provisions “cloaked in heavy legalese”). Most users do not read the contracts at all. Id.
[245] See id. (adding that gamers typically do not have attention to read each provision of EULA).
[246] The first section of the World of Warcraft EULA contract specifies that “[t]he Game may only be played by obtaining from Blizzard access to the World of Warcraft massively multi-player on-line role-playing game service[,] . . . which is subject to a separate Terms of Use agreement.” Blizzard, EULA, supra note 237; see Jankowich, EULAw, supra note 32, at 17-18 (discussing nine documents that EVE Online players presumptively understand via participation).
[247] See Vault v. Quaid Software, Ltd., 655 F. Supp. 750, 760 (E.D. La. 1987).
[248] See Oakley, supra note 187, at 1052-53 (finding that while clickwrap agreements allow opportunity for consumer affirmatively to click “I agree,” that option does not mitigate fact that consumer had no part in drafting contract).
[249] See Jankowich, Property and Democracy, supra note 16, at 177 (“[A]nything left out of the Lessigian code/law would fall into the catch-all restrictions of the end user license agreement”).
[250] The terms of the World of Warcraft TOU prohibit, inter alia, anything that is contrary to the “essence” of World of Warcraft, “carry[ing] out any action with a disruptive effect,” owning more than one account, and choosing an avatar name that is “related to drugs, sex, alcohol, or criminal activity” or “[b]elonging to any religious figure or deity.” Blizzard, TOU, supra note 32, at 1, 3(A)(6)-(8), 3(B)(ii), 3(C)(v). Most MMORPG EULA, TOU, and TOS agreements contain similar provisions. See, e.g., Linden Lab, TOS, supra note 62, at 2.3 (requiring character name that is “not misleading, offensive, or infringing”); Linden Lab, Community Standards, http://secondlife.com/corporate/cs.php (threatening suspension or expulsion from Second Life for “intolerance,” “harassment,” “assault,” “disclosure,” “indecency,” and “disturbing the peace”). Blizzard bundles the clause prohibiting RMT within these provisions. Id. at (8). Note that Blizzard either owns, or has exclusively licensed, all of the content that appears in World of Warcraft. Therefore, no one has the right to "sell" Blizzard's content, except Blizzard. So Blizzard does not recognize any property claims outside of World of Warcraft or the purported sale, gift or trade in the "real world" of anything related to World of Warcraft. Accordingly, you may not sell items for "real" money or exchange items outside of World of Warcraft. Id.
[251] See Fairfield, supra note 16, at 1083 (noting that designers “parlay their (legitimate) claim to the intellectual property in an environment into an illegitimate claim to all of the virtual property possessed by or developed by the inhabitants of the environment”).
[252] See supra notes 180–84 (discussing individual and business incentives to invest in virtual worlds).
[253] See Raymond T. Nimmer, Breaking Barriers: The Relation Between Contract and Intellectual Property Law, 13 Berkeley Tech. L.J. 827, 848 (“A contract of adhesion analysis typically indicates that a court enforces the contract, but scrutinizes its terms more closely for terms that are procedurally or substantively unconscionable”).
[254] Linden Lab, What is Second Life?, http://secondlife.com/whatis/ (last visited August 11, 2006).
[255] See infra note 263 (discussing online auction site that Sony opened to mitigate RMT activity in Everquest).
[256] Linden Lab, IP Rights, supra note 62.
[257] Linden Lab, What is Second Life?, supra note 254.
[258] See Linden Lab, TOS, supra note 62, at 1.5 (explaining a service called “LindeX” that allows players to exchange virtual currency for real money).
[259] See Linden Lab, Land: Islands, http://secondlife.com/community/land-islands.php (last visited July 30, 2006) (detailing island size, topology, and price).
[260] See Yuki Noguchi, Yahoo, Wal-Mart Build a Virtual Catwalk; Contest Puts the Retailer’s Fashions on Users’ Avatars, Wash. Post, August 10, 2006, at D05 (explaining that MTV sponsored avatar fashion show and ESPN.com users can use avatars to give sports commentary that is featured on ESPN.com home page).
[261] Linden Lab employs this mechanism in its TOS agreement. Compare Linden Lab, TOS, supra note 62, at 3.2 (granting intellectual property rights in virtual property), with id. at 3.3 (retaining ownership in “account and related data”), and id. at 5.2 (reserving right to delete accounts without liability).
[262] Greg Sandoval, Sony to Ban Sale of Online Characters From Its Popular Gaming Sites, CNET News.com, Apr. 10, 2000, http://news.com.com/2100-1017-239052.html?legacy=cnet (last visited Aug. 10, 2006).
[263] See Sony Entertainment, Station Exchange: The Official Secure Marketplace for EverQuest II Players, http://stationexchange.station.sony.com (last visited Aug. 11, 2006) (opening designer-sanctioned online auction).
[264] See Renato Marrotti, Cyberspace in Three Dimensions, 55 Syracuse L. Rev. 251, 290-91 (2005) (“Very powerful characters have sold for up to $ 3,000”).
[265] See id. (remarking that Ultima Online designers consider this process to convert into real wealth passion that gamers manifest for game).
[266] See Jessica Ramirez, The New Ad Game; Advanced technology is finally allowing advertisers to get inside videogames like never before. Welcome to the new frontier., Newsweek, July 31, 2006, at 42 (“There are at least 132 million gamers 13 years and older in the United States alone”).
[267] See, e.g., IGE, About Us, supra note 30 (selling virtual currency and assets for real money).
[268] Tal S. Zarsky, Information Privacy in Virtual Worlds: Identifying Unique Concerns Beyond the Online and Offline Worlds, 49 N.Y.L. Sch. L. Rev. 231, 261 n.105.
[269] See Fairfield, supra note 16, at 1062 (“The projected U.S. revenue from sales of virtual objects in real-world currency is approximately $ 100 million dollars, and over $ 1.5 billion worth of transactions occurs yearly through in-environment trades”).
[270] Courts should more regularly implement the unconscionability doctrine. See Ryan J. Casamiquela, Contractual Assent and Enforceability in Cyberspace, 17 Berkeley Tech. L.J. 475, 488-89 (explicating how courts produce obscure, unfair results by readily enforcing online licenses (citing M. A. Mortenson Co. v. Timberline Software Corp., 998 P.2d 305, 315 (Wash. 2000) (enforcing remedies limitation that parties did not discuss, costing plaintiff $2,000,000))).
[271] Id.
[272] E.g., Linden Lab, TOS, supra note 62, at 2.6.
[273] Intel Corp. v. Hamidi, 71 P.3d 296 (Cal. 2003).
[274] See eBay v. Bidder’s Edge, 100 F. Supp. 2d 1058, 1071 (N.D. Cal. 2000) (turning to Restatement to determine harm required to sustain trespass to chattels cause of action applied to computer database); cf. John D. Saba, Jr., Comment, Internet Property Rights: E-Trespass, 33 St. Mary’s L. J. 367, 372 (identifying how courts applied trespass to chattels to computer data because modern trespass doctrine does not require strict physicality).
[275] Restatement (Second) of Torts § 217 (1965). “Intermeddling” means intentionally bringing about physical contact with the chattel. Id. § 217 cmt. e.
[276] Restatement (Second) of Torts § 218.
[277] The Restatement cites a toothbrush or an intimate garment as something that a possessor may find “reasonably destroy[s]” the chattel’s value. Id. § 218; see Caffarelli, supra note 104, at ¶ 44 n. 155 (concluding that Restatement provisions provide for actionable trespasses even absent physical harm and applying that concept to web sites). But see Intel v. Hamidi, 71 P.3d 296 (Cal. 2003) (declining to find actionable trespass to chattels where employee used e-mail server without consent to send thousands of e-mails).
[278] eBay v. Bidder’s Edge, 100 F. Supp. 2d 1058 (N.D. Cal. 2000).
[279] Id. at 1061-62.
[280] See id. at 1069 (finding likelihood of success that eBay could prove electronic signals sufficiently met Restatement’s tangibility requirements).
[281] See id. at 1070-71 (reasoning that eBay warns all automated visitors to its website that it does not permit such access, rejecting argument that eBay’s publicly accessible sites grant access permission to automated users, and finding that web crawlers exceed scope of consent that eBay granted).
[282] Id. at 1071; Restatement (Second) of Torts § 218.
[283] Intel Corp. v. Hamidi, 71 P.3d 296 (S. Ct. Cal. 2003).
[284] See id. at 300 (applying again Restatement provisions to computer data chattels).
[285] Id. at 299-300. Although the majority found no valid cause of action, Justice Mosk entered a vehement dissent in which he analogized Hamidi’s e-mails to hundred of mail carriers running down the hallways of the Intel offices. Id. at 309 (Mosk, J., dissenting).
[286] See supra Part II (applying Lockean, personhood, and Benthamist property theories to MMORPG chattels secured).
[287] See Restatement (Second) of Torts §§ 217-18 (requiring, in addition to intent, that trespasser dispossess possessor for at least substantial period, or impair chattel’s condition, quality, or value).
[288] See Intel, 71 P.3d at 300 (failing to find actionable trespass where electronic communication did not interfere with possessor’s use or possession of personal property).
[289] See id. at 304 (declining to find injury in electronic signals that “assertedly cause injury only because of their contents”).
[290] Cf. Hotmail Corp. v. Van Money Pie, Inc., Nos. C98-20064 JW & C-98 JW PWT ENE, 1998 U.S. Dist. LEXIS 10729, at *19 (N.D. Cal. Apr. 16, 1998) (finding likelihood of success on trespass to chattels claim because spam e-mails sent to Hotmail customers “fill[ed] up Hotmail’s computer storage space” and prevented entirely e-mail delivery).
[291] See Intel, 71 P.3d at 301 (finding that “the claimed injury is located in the disruption or distraction caused to recipients of the contents of the e-mail messages”).
[292] See id. (characterizing objection to contents of messages as “entirely separate from” personal property disruption).
[293] See id. at 308 (finding no harm where Intel’s e-mail server worked as designed).
[294] Courts could interpret gamers’ trespass to chattels claims in terms of computer resources or electronic signals, potential success. See Thrifty-Tel, Inc. v. Bezenek, 54 Cal. Rptr. 2d 468, 471 (1996) (finding electronic signals caused by phone calls sufficiently tangible to support trespass claim). But almost all activity in MMORPGEs does not occur on computers owned by persons or entities engaged in RMT; it occurs on servers owned by the game designer. See Stephens, supra note 18, at 1517-18 (explicating only one object code copy exists on a server, and that client software merely allows a gamer to view the code on his or her computer). A World of Warcraft gamer can access his or her avatar from any computer that has the client software installed. Id. This objection proceeds that gamers would have to argue that designers damage or impair their own computer systems, and that courts would not accept such an anomalous argument. Cf. id. at 1521 (finding no copyright infringement based on designers’ right to make copies because, given server-client structure of MMORPGEs, RMT activity does not copy any code). This intuitive image of property as belonging inherently to the designer does not comport with a legally cognizable interest in virtual chattels secured in MMORPGEs. See supra Part II (applying Lockean, personhood, and utilitarian property theories to justify property interests in virtual chattels).
[295] Professors Lastowka & Hunter argue the opposite, but note that prosecutors likely would not pursue theft in virtual worlds where the game designer permits that activity. F. Gregory Lastowka & Dan Hunter, Virtual Crimes, 49 N.Y.L. Sch. L. Rev. 293, 311 (2004).
[296] See Balkin, Law And Liberty, supra note 13, at 65 (“The right to play The Gulag Online is the right to experience–and to be subjected to–what can happen in that place”); cf. Lastowka & Hunter, Virtual Crimes, supra note 295, at 303 (reasoning that prosecutors would not consider criminal liability for actions that occur entirely within virtual worlds).
[297] See Ultima Online Support: Harassment Policy and Reporting, http://support.uo.com/gm9.html (last visited Mar. 11, 2007) (identifying theft as “valid play style”).
[298] Players typically click on a monster’s corpse to retrieve any virtual assets contained on its body. Blizzard Entertainment, World of Warcraft Manual, supra note 45, at 24. If players group together, they sometimes develop individual mechanisms for determining which party member gets to take certain assets. Id. at 142. A “ninja looter” takes all the assets, sometimes very valuable assets, and typically earns public humiliation by the rest of his or her party. See Posting of Clearsky to WoW Forums, http://forums.worldofwarcraft.com/thread.html?topicId=1777872026&postId=17777231672&sid=1#0 (Sept. 22, 2007, 07:23:13 PM UTC) (noting that “honorable” guild will remove members who ninja-loot items in MMORPGEs).
[299] See supra note 298 and accompanying text.
[300] See Edward Castronova, The Right to Play, 49 N.Y.L. Sch. L. Rev. 185, 191 (noting that other countries choose to prosecute people who hack MMORPG accounts, and positing that most governments would prosecute entirely intraworld activity). But see Lastowka & Hunter, Virtual Crimes, supra note 295, at 303-04 (reasoning that treating virtual theft as actual theft would keep external regulations from impinging on virtual world development).
[301] See Castronova, The Right to Play, supra note 300, at 191-92 (noting that Allen Iverson’s basketball opponent cannot arrest him for stealing a basketball).
[302] See Balkin, Law And Liberty, supra note 13, at 79 (forecasting sardonically that if game designer went bankrupt, gamers could “petition the bankruptcy court to keep the game running, restructure the business, and/or sell it to another party so that player's virtual property interests are not destroyed”).
[303] Stealing an account password or hacking an account requires that an individual leave the virtual world and perform some action to cause deprivation.
[304] See Lastowka & Hunter, Virtual Crimes, supra note 295, at 308 (reminding that, unlike other computer games, virtual worlds do not rely exclusively on computer code and that designers implement important social rights, like stealing, that deserve attention).
[305] Some entirely intraworld activity, for example, does not seem fair. In the MMORPG Eve Online, for example, players can set up banks that let players store their virtual cash. See Bobbie Johnson, Should Virtual Criminals Have Their Real-Life Collars felt?, The Guardian (London), Aug. 31, 2006, at 3 (describing Eve Intergalactic Bank and explaining that one player created bank that offered interest because “ISK,” the virtual currency, depreciated quickly). In the MMORPG Eve Online, for example, players can set up banks that let players store their virtual cash. Id. One player set up such a bank, which held about 100,000,000,000 virtual currency units. Id. The player closed the bank and ran away with all the currency, valued at about $40,000. Id. The player did not break the rules of the game. Id. Entirely intraworld activity can cause real harm.
[306] See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 72 (“Courts will need to recognize that virtual worlds are jurisdictions separate from our own, with their own distinctive community norms, laws, and rights”).
[307] See Balkin, Law And Liberty, supra note 13, at 2045-46 (“Much of what goes on in virtual worlds should be protected against state interference by the First Amendment rights of freedom of expression and association”).
[308] Compare id. at 2090-91 (suggesting that legislatures adopt statutes of iteration, or statutes that offer legal frameworks that structure designer-gamer relations), with Jankowich, Property and Democracy, supra note 16, at 192 (“In effect, the prospect of legislation to regulate virtual worlds at this point presents an example of virtual nation-building in which virtual worlds will be shaped by the impressions of outsiders rather than the desires of inhabitants”).
[309] Lastowka & Hunter, Virtual Crimes, supra note 295, at 298 (employing, as an archetype of virtual crime, a “real-time and non-consensual” written description of a sexual assault).
[310] Jack M. Balkin, Virtual Liberty, supra note 41, at 66 (noting that both MMORPG designers and participants can act so as to offend each other, and that important legal issues will result from these disagreements).
[311] See Lastowka & Hunter, Virtual Crimes, supra note 295, at 62 (concluding MMORPG designers should not always have absolute authority over virtual worlds, but questioning what rights gamers should acquire in virtual worlds).
Citation
8 U.C. Davis Bus. L.J. 235 (2007)
Assessing Online Gamers' Authority to Sell In-Game Assets Where Adhesive Contracts Prohibit Such Activity
Vol. 8
January 2008
Page
When a time comes that new modes and venues exist for communities, and said modes are different enough from the existing ones that question arises as to the applicability of past custom and law; and when said venues have become a forum for interaction and society for the general public regardless of the intent of the creators of said venue; and at a time when said communities and spaces are rising in popularity and are now widely exploited for commercial gain; it behooves those involved in said communities and venues to affirm and declare the inalienable rights of the members of said communities.[1]
-Raph Koster
Introduction
A lawyer supplements her income by building mansions in the evening.[2] A teacher in California pays his mortgage by selling escort services to New York City dwellers.[3] A real estate broker buys and sells land around the globe, never leaving her desk or paying property taxes.[4] Right now, millions of people are engaging in online communities rather than talking with friends over a coffee, joining their classmates in a lecture hall, or going to work.[5] Or so it seems: the most innovative video games allow players to engage in all of those activities, and more, without having to take their hands off the keyboard.[6]
Today’s games use the Internet and technological advances to create comprehensive, dynamic virtual worlds.[7] Massively multiplayer online role–playing games (“MMORPGs”) provide the platform for these virtual worlds.[8] Through this virtual interface, players create virtual representations of themselves:[9] they buy, improve, sell, or otherwise enjoy virtual plots of land;[10] construct virtual cottages, mansions, and department stores;[11] create, sell, pawn, and trade virtual chattels;[12] and amass virtual clout for accomplishing outlandish acts or securing otherwise unavailable artifacts.[13] For some, the prospect of a second life motivates participation in these worlds.[14] For others, participation constitutes a business venture aimed at converting hypothetical property in virtual worlds into identifiable property with real economic value.[15] This Article addresses the complicated legal issues that accompany these business ventures and the rapid growth of sociocultural interests in MMORPG environments (“MMORPGEs”).[16]
Online role–playing games have existed for at least two decades[17] and constitute one of the most successful business enterprises that engage the Internet.[18] Current worldwide participation in MMORPG environments is unprecedented.[19] Sony secures about $3,600,000 in monthly revenue from its Everquest title.[20] More gamers play Blizzard Entertainment’s (“Blizzard”) World of Warcraft than any other MMORPG title,[21] and arguably even more than any other game that implements the Internet.[22] Blizzard likely secures at least $117,000,000 in monthly subscription fees alone.[23] As might be expected, the broad participation responsible for this economic success, considered with the interactive nature of these virtual worlds, has produced secondary markets for virtual objects secured inside the game environment.[24]
The practice of selling virtual chattels is complicated; consider the following example. Player A spends six months collecting virtual currency in World of Warcraft.[25] He visits a website that offers to purchase his virtual gold for a sum of United States dollars.[26] The company pays him, and a company representative and Player A both log into the virtual world.[27] They meet in a virtual house and Player A gives the company’s representative avatar[28] the virtual currency.[29] The company then sells the gold to other gamers at a profit.[30] This practice is called real money trade (“RMT”).[31] Avatars often communicate to create groups that find valuable artifacts and amass significant quantities of virtual currency, often selling the items or currency in RMT on auction websites, and splitting the profits. Most MMORPG end–user license agreement (“EULA”) contracts prohibit RMT activity.[32]
Although Blizzard has not filed any lawsuits to date, it has maintained a hard–line stance against RMT activity.[33] Blizzard has eliminated offending players’ accounts and halted virtual property auctions on eBay.[34] Blizzard recently banned over 59,000 accounts and removed 22,000,000 gold from the virtual economy for “farming gold” and using third–party programs to collect the virtual currency more efficiently.[35]
Blizzard, however, is not a stranger to the courtroom.[36] Gamers have filed suits against the company before,[37] and could file suit again as they secure interests in virtual worlds.[38] Considering the population of that environment,[39] and the frequency with which that population engages in RMT,[40] scholars predict a lawsuit to resolve the RMT issue.[41]
This Article posits that courts should recognize legally cognizable property interests in virtual currencies and chattels secured in MMORPGEs. Specifically, courts risk eliminating legitimate property interests when they enforce the EULAs, Terms of Service (“TOS”), and/or Terms of Use (“TOU”) upon which designers predicate access to the virtual world.[42] Part I introduces virtual worlds, virtual property, and the contracts that designers use to control gamer activity. Part II demonstrates that contracts of adhesion that prohibit RMT activity unconscionably eliminate gamers’ property interests in MMORPGEs. Part III recommends that courts find a valid gamer–borne cause of action in trespass to chattels, and considers necessary limitations on that doctrine. Provisions that prohibit RMT activity and allow designers to delete gamers’ virtual property eliminate valuable emergent property interests.[43]
I. Virtual Worlds, Real Money, and Underdeveloped Law
A. Life in MMORPG Environments, and Real World Contractual Restrictions Imposed By Designers
Blizzard Entertainment’s World of Warcraft MMORPG provides an instructive example of the process by which users enter MMORPGEs. After purchasing and installing the client software and subscribing to a payment plan, players create an avatar[44] that will inhabit the world.[45] Players choose one of two factions with which their avatar will align.[46] After faction selection, participants choose a race.[47] Players then choose a sex for their avatar, and select one of several hairstyles, skin tones, and eye colors.[48] Finally, players choose a class, which will determine some skills that their avatar, and not others, can employ in the virtual world.[49]
After creating and naming an avatar, “newbie” participants enter the virtual world in an area similar to a training ground, where they perform mundane “quests,” like collecting flowers or slaying coyotes to achieve “experience.”[50] Collecting a certain amount of experience eventually promotes an avatar to the next level.[51] With each level, players acquire new abilities and access to more difficult areas of the virtual world.[52] Reaching the highest level might take months of dedicated play,[53] during which time avatars learn marketable trade skills and collect increasingly valuable armor, weapons, artifacts, and other desirable virtual chattels.[54] Players can put those items in the virtual auction house where other players bid using virtual currency collected during their travels.[55] Players often elect to sell those objects, and/or the virtual currency used to purchase them, in RMT transactions.[56]
Before this process can begin, gamers must agree to a contract that conditions avatar creation on a wide variety of terms.[57] MMORPG designers implement EULA contracts to control social norms and economic activity in MMORPGEs.[58] As such, EULAs serve important purposes in MMORPGEs.[59] Since MMORPGs are games that take place in a virtual world, designers have an interest in establishing the rules that govern the world.[60] Computer code, however, cannot regulate social policies and behavioral norms; one might consider EULA terms as compensating for designers’ lack of control.[61] EULA agreements protect, through contract principles, sociocultural norms that evade regulation through computer code.[62]
Some EULA contracts for accessing MMORPG virtual worlds contain controversial terms and clauses.[63] As game designers’ require blanket assent to all terms in an EULA,[64] EULAs consequently create gamer–designer tension.[65] Designers may have a variety of interests.[66] For example, EULAs commonly require users to disclose their real identity when they sign up for the game,[67] prohibit offensive avatar names,[68] restrict controversial speech or behavior,[69] or limit such activity to virtual areas designated “mature.”[70]
One area related to RMT activity where designers and gamers both have an interest is virtual economy maintenance.[71] One common EULA provision prohibits RMT activity.[72] Nearly all MMORPGEs simulate a property–based economy.[73] MMORPG designers include a variety of EULA provisions intended to eliminate RMT activity.[74] Some titles expressly prohibit such activity.[75] Others claim all property in a virtual world and/or all intellectual property rights in a virtual world.[76] Others prohibit the gamer from selling his or her account or copy of the software to others.[77] Designers regularly reserve the right to delete an account or turn off the virtual world at their leisure to prevent undesirable activity.[78] By retaining rights to as much in–game content as possible, designers create more provisions upon which they can rely to preclude RMT activity.[79]
B. American Jurisprudence Fails to Address Virtual Property Interests in MMORPG Environments [80]
RMT activity results from the substantial and increasing virtual population,[81] and an expansive industry dedicated to selling in–game property exists.[82] Given the widespread RMT activity in MMORPGEs,[83] legal scholars eagerly anticipate a gamer or designer–borne lawsuit to protect their interests in virtual assets in MMORPGEs.[84] For what legal rights should litigants argue in virtual worlds, and what legal rights might courts find?[85]
No court in the United States has had the occasion to completely consider a legally cognizable virtual property right in an MMORPGE.[86] In Blacksnow Interactive v. Mythic Entertainment,[87] Mythic sued Blacksnow for running a “virtual sweatshop.”[88] According to Julian Dibbell’s often–cited account of the case, Blacksnow employed unskilled workers to play Ultima Online and Dark Age of Camelot, earning gold and artifacts and selling them on websites like eBay.[89] Mythic argued that the Blacksnow operation infringed its intellectual property rights.[90] Blacksnow ultimately “skipped town without a trace”[91] after the Federal Trade Commission found that the company fraudulently, and perhaps sardonically, offered non–existent computers for auction on eBay.[92] The case constitutes a disappointment to the extent that procedural default precluded the court from considering whether virtual world chattels had legally cognizable value.[93]
In the first lawsuit of its kind,[94] a virtual world resident sued Linden Labs, a company that designs a popular virtual environment called Second Life.[95] The gamer alleged that the game developer inappropriately turned off his account, thereby vaporizing his virtual land and any potential profits resulting there from.[96] Although the Second Life TOS grants to gamers intellectual property rights to property created in–game,[97] it also specifies that participants have no right to in–game property if Linden Labs terminates their account[98] and that participants do not own the server data that contains their property.[99] The substance of the yet–to–be–resolved complaint alleges contract and property causes of action.[100] Even though Linden Labs grants gamers intellectual property rights in virtual commodities created online, Linden Labs reserves the right to pull the plug on an account, and hence on any associated virtual property.[101] An MMORPG policy that gives gamers a contractual right to objects created in–game (property interest in virtual chattels), but does not preclude the designer from eliminating that property, seems directly contradictory.
II. Virtual Chattels Secured in MMORPG Environments as Property Under Traditional and Contemporary Property Theories
Gamers spend countless hours investing their time, energy, and identities to develop their avatars in virtual worlds. That development occurs when players acquire money, valuable items, and the social cache that follows acquisition of such rare items. Moreover, MMORPG participants invest emotionally in their avatars, establishing a constitutive psychological relationship with their in–game personae. An exploration of this investment reveals that under a Lockean, utilitarian, or personhood theory of property, gamers secure legally cognizable property interests in virtual chattels.
A. Lockean Theory: MMORPG Participation as Labor, not Play
John Locke’s labor theory of property promotes a legally cognizable property interest in virtual property secured in MMORPGEs because gamers invest substantial time, energy, and resources into virtual worlds.[102] Locke’s theory of property posits that a person obtains an ownership interest in an object by injecting his or her labor into it.[103] Locke argued that property constitutes a natural right resulting from labor.[104] Because each individual has a property interest in his or her flesh and blood,[105] labors exacted by that flesh and blood fall within his or her ownership.[106] Without that labor, property would have no value.[107] The person who mixes his or her labor with a thing also elevates that thing to its highest value.[108]
Lockean property theory is well established in American jurisprudence.[109] Since Pierson v. Post,[110] the law has rewarded useful labor applications that create property value.[111] Professor Joshua A. T. Fairfield reported that a Chinese litigant invoked Locke’s labor theory of property when he explained why the Chinese court should order an MMORPG designer to return virtual chattels to him stolen via fraud by another player.[112] The gamer argued that he “exchanged the [virtual] equipment with [his] labor, time, wisdom, and money, and of course they are my belongings.”[113] Taiwanese law expressly recognizes that virtual property has real world value and grants a property interest to “the owner of the code object, not the owner of the server on which the code happens to reside.”[114] Courts in other countries recognize that labor invested in MMORPGEs progresses towards a legally cognizable property interest.[115]
Gamers inject their labor into MMORPGEs, such that they acquire a property interest in the chattels secured therein.[116] An individual who earns a real world living from virtual business ventures dedicates substantial time and energy into that project.[117] In some MMORPGEs, gamers play for months or years before acquiring access to world areas replete with saleable virtual chattels.[118] Some gamers elect to make a business from selling those chattels.[119] Others tire from the game, sell their avatar and its possessions on a website like eBay, and earn a net profit from their game play.[120]
Moreover, gamers increase the value of their virtual world and their virtual chattels through their labor.[121] Inasmuch as RMT activity constitutes a secondary market, that market attaches real world value to unused virtual chattels.[122] There is no practical limit to the amount of RMT activity that virtual worlds can accommodate, nor to the number of unused virtual chattels.[123] Gamers should enjoy exclusive rights to virtual chattels because acquisition does not exhaust resources, and the law should promote things in which individuals inject their labor by recognizing a private property interest in virtual chattels sold in RMT transactions.[124] Gamers inject their labor into MMORPGEs, and earn the right to use and enjoy virtual chattels secured in MMORPGEs.[125]
Locke’s labor theory does not only apply to individual gamers who engage in “click–slavery” to acquire objects that they elect to sell.[126] Businesspersons inject labor in incorporated and unincorporated entities that specialize in securing and distributing valuable virtual currencies, items, and accounts for different MMORPGEs.[127] Those businesses coordinate with gamers and employ persons throughout MMORPGEs.[128] One company, IGE, claims that its revenues will exceed the revenues generated by the companies that create MMORPGEs.[129] The idea that a number of persons labor to create a business that coordinates and distributes significant quantities of virtual chattels buttresses the Lockean justification that the MMORPG designer does not have all the sticks in the virtual property bundle. Moreover, recognizing labor invested in virtual worlds will encourage businesses to invest in these environments.[130]
B. Personhood Theory: MMORPG Avatars and Chattels as Constitutively Related to Individuals, Businesses, and Communities in Virtual Worlds
Since MMORPG participants, businesses, and the community in MMORPGEs bear strong identificatory relationships with their avatars and the virtual goods that they collect and trade in virtual worlds, personhood theory compels the law to recognize a property interest in virtual chattels. Personhood theory, prominently applied in a legal context by Margaret Jane Radin, derives from Hegel’s theory of property as an extension of the self.[131] Under this theory, property bears a constitutive relationship with identity,[132] and the law should promote property with which an individual has such a relationship.[133] Personhood theories value most dearly the interests from which separation causes pain,[134] and the law must therefore recognize restraints on property that fail to account for an individual’s right to control the property with which he or she has a constitutive relationship.[135] The Supreme Court recognized this property justification in discussing the intangible property interests protected by copyright law.[136] The well–recognized shift in landlord–tenant law from a property construct to a property–contract amalgam implicitly recognizes the importance of property with which individuals have important personhood interests.[137]
As with their personal property, individual gamers unquestionably have an identificatory relationship with their avatars and the accoutrements that their avatars acquire. The law should promote that relationship by identifying a property interest in virtual chattels and currency.[138] Many MMORPG participants use their avatars to experience an otherwise unavailable sociocultural position.[139] Depending upon an avatar’s group or guild associations, style of play, social prowess, or even race, sex, and physique, an avatar can provide important insight into an individual’s personality and beliefs.[140] Since MMORPGs require cooperation between groups of people and social interaction,[141] characters acquire a positive or negative reputation in the virtual world when they acquire valuable items or accomplish outlandish feats.[142] A magical piece of chain mail or a swanky virtual bar constitutes property from which deprivation causes pain: Chinese courts have documented suicide and murder resulting from virtual property theft.[143] Individual games acquire personhood rights in virtual property acquired in–game because their avatars represent who they are and, perhaps, who they are not.[144]
Moreover, companies and other business entities that buy and sell virtual chattels also have important personhood relationships with property secured in MMORPGEs.[145] The predominantly commercial property interests of these business entities do not eliminate the possibility for a personhood relationship.[146] Individuals work together to create businesses, and the product of that labor relates constitutively with those individuals.[147] The highest volumes of RMT activity result when a person creates a business by securing and selling large quantities of currency or chattels from MMORPGEs.[148] For example, in Second Life, avatar Ansche Chung has created a substantial network of persons who buy and sell virtual real estate.[149] In other MMORPGEs, companies like IGE have created large buy–and–sell networks engaged in RMT in various virtual worlds.[150] Some MMORPG designers encourage RMT activity and host auction houses that provide a controlled marketplace for virtual goods.[151]
Conversely, a different argument supports the allowance of other MMORPG designers to prohibit RMT activity. Blizzard, an MMORPG designer that capitalized the MMORPG market by creating World of Warcraft, is an example of businesses with important personhood interests in establishing a particular type of MMORPG environment.[152] Because Blizzard is the designer, it has the right to determine the rules of the game to protect its identificatory relationship with the MMORPG industry and the virtual world it designed.[153] This argument posits that the law should promote Blizzard’s identificatory relationship with its MMORPG environment, by allowing it to prohibit RMT activity that alters the virtual economy with which Blizzard has a personhood interest.[154] This argument is also consistent with an intuitive image of property, namely that Blizzard owns the data that constitutes the virtual world and Blizzard, therefore, controls every stick in the bundle.[155]
However, the constitutive relationships established between individuals and virtual chattels, and between businesses that coordinate avatars and RMT activity, remains an important consideration. These constitutive relationships ultimately form a community with personhood interest that the law should protect.[156] If the game designer elected to turn off the server to prevent RMT activity, interrupting millions of players engaged in virtual worlds, that deprivation would cause pain to individuals and to the greater World of Warcraft community.[157] MMORPG participants hold weddings and even funerals in virtual worlds.[158] One funeral spurned heated Internet commotion when members of a hostile faction deliberately murdered every funeral attendee.[159] The murdered avatars’ anger, expressed on bulletin boards and across the Internet, reflects their community personhood interests in the virtual world.[160] The law should protect these community personhood interests.[161]
C. Utilitarian Theory: RMT–Prohibiting Provisions as Disincentives to New Businesses
Utilitarian property theorists suggest that the law recognizes private property interests where such recognition would promote the general welfare.[162] Jeremy Bentham’s utilitarian theory supports the idea that courts recognize a property interest in chattels secured in MMORPGEs. Generally, Benthamists balance pleasure and pain to determine what the law should or should not allow.[163] Bentham’s utilitarian theory argues that the law should promote property that provides the greatest good to the largest number of people.[164] Accordingly, if the law fails sufficiently to protect certain private property rights, the law therefore exacts harm on society.[165] Utilitarian theory prominently applies, for example, in nuisance law.[166]
MMORPG designers use their property to harm others when they take actions to prohibit RMT activity. Nuisance law, in which the law punishes the person who harms others with his or her property, attempts to cure this type of harm.[167] Courts interpret whether one person’s use of property constitutes a nuisance by applying a multifactor balancing test.[168] The test balances the gravity of the harm to the non–nuisance actor against the social utility of the nuisance actor’s conduct, to determine whether a particular property use constitutes a nuisance.[169] As discussed above, terminating player accounts to prohibit RMT activity eliminates property interests established when gamers and businesses inject their labor into MMORPGEs and business entities to engage in RMT activity.
Designers exact a grave harm on virtual world inhabitants when they systematically take measures to eliminate RMT activity. For example, if a player engages in RMT activity and a designer interferes by terminating accounts or shutting down the game server, the designer potentially destroys millions of dollars invested in the virtual world.[170] Moreover, engaging in RMT activity constitutes an exciting new type of business.[171] Allowing RMT activity encourages others to invest creatively in virtual worlds.[172] Persons engaged in RMT in World of Warcraft could not move to a title that allows RMT activity because the long–term abilities that their avatars acquire would not transfer to a different title.[173] Moving to another server or even another jurisdiction with more favorable RMT provisions could potentially cost years in avatar development.[174]
Actions to eliminate RMT activity lack social utility.[175] Designers do not act reasonably when they arbitrarily delete substantial investments and predicate that authority on an unconscionable contract provision.[176] Their conduct lacks social value because society should invest in creative business and cultural ventures in MMORPGEs. Although designers’ conduct is intuitively appropriate because they have a right to determine the rules of the game,[177] unprecedented participation in MMORPGEs makes RMT–prohibiting actions unsuitable. Finally, MMORPG designers like Blizzard can entirely avoid the harm by allowing RMT activity on some, but not all, of their servers, or provide a designer–run auction house.[178] As designers exact harm on the MMORPG community when they delete virtual assets or MMORPG accounts to terminate RMT activity, and because the social utility of that action does not justify the harm, designers fail to benefit the greatest number of people when enforcing RMT–prohibiting contract provisions.[179]
If the law fails to enforce a private property right in virtual chattels, gamers and entrepreneurs are less likely to invest in virtual worlds.[180] Linden Labs designed its Second Life virtual world to attract persons or entities desiring to invest in businesses in virtual worlds.[181] Eliminating the investments in that virtual world harms designers who intend to create similar worlds, as well as gamers or entrepreneurs looking for creative business projects.[182] Recognizing the fruits of a business invested in virtual world trade encourages other businesses to invest in MMORPGEs.[183] Moreover, if United States courts fail to recognize a “real world” property interest in chattels secured in–game, these businesses will move to jurisdictions that do.[184] Allowing RMT activity allows the United States to compete with other countries that grant substantial property rights in virtual property.[185]
III. MMORPG EULA Contracts: Virtually Enforceable, or Simply Unconscionable?
Gamers and businesses hold substantial property interests in virtual worlds. Designers typically predicate access to those worlds on EULA contracts. EULAs that contain provisions granting designers the right to terminate accounts or turn off the server assume a traditionally suspect contract form.[186] MMORPG EULA contracts typically constitute “clickwrap”[187] or “browsewrap”[188] agreements.[189] Since ProCD v. Zeidenberg,[190] courts typically hold these agreements enforceable.[191] However, this Article submits that courts should find MMORPG EULA provisions that prohibit RMT activity procedurally and substantively unconscionable because they eliminate substantial property interests.
In ProCD, plaintiff ProCD compiled phone numbers and addresses into an expansive database.[192] ProCD sold the database on CD–ROM disks covered in plastic wrap, or “shrinkwrap.”[193] The United States Court of Appeals for the Seventh Circuit held that a vendor could invite acceptance through opening and using the CD–ROM,[194] reasoning with the U.C.C. proclamation that “[a] contract for the sale of goods may be made in any manner sufficient to show agreement.”[195] Judge Easterbrook, writing for the ProCD court, subjected the Seventh Circuit’s holding to the U.C.C. rule that a buyer accepts goods when, “after an opportunity to inspect, he fails to make an effective rejection under § 2–602(1).”[196] Inasmuch as the contract allowed the buyer to inspect and return the product,[197] the court found the shrinkwrap agreement enforceable to the extent that it did not violate a contract law rule.[198]
Generally, courts have adhered to the Seventh Circuit rule, applying it to most electronic standard–form agreements,[199] and reversing where the contract permits no manifestation of assent.[200] Most MMORPGs implement a “clickwrap” agreement that presents the entire contract during the installation process.[201] The user must scroll through the document, at which point an “I Agree” button activates.[202] The user can click “I Agree” to proceed to software installation, or click “I Decline” to terminate the program.[203] Some MMORPGs require users to perform this review each time they sign into the environment,[204] while others require users to perform this review each time the software updates.[205] Courts apply the ProCD rule and enforce clickwrap agreements because the agreements allow a reasonable opportunity to review the document, require the user affirmatively to click “I agree” before using the software, and provide an opportunity to return the software should the purchaser refuse to agree.[206] Most MMORPG EULA contracts that prohibit RMT activity meet the floor established since ProCD.[207]
But since MMORPG EULAs contain provisions “objectionable on grounds applicable to contracts in general,”[208] courts should find that designers cannot rely on EULAs to prohibit increasingly common RMT activity.[209] In ProCD, neither party argued that the shrinkwrap license contained any generally objectionable terms, and the court therefore did not address this question.[210] Likewise, scholars have not addressed in detail whether courts will find terms that prohibit RMT activity unconscionable. The question merits investigation because courts can refuse to enforce as unconscionable the entire contract or a specific term or terms.[211]
Courts generally require both procedural and substantive unconscionability to find a contract provision unenforceable.[212] When assessing procedural unconscionability, courts look to how the parties formed an agreement, whether or not the contract contained long and complicated text or provisions, or whether the parties formed the contract under pressure.[213] Courts might consider the “age, education, intelligence, business acumen and experience of the parties, . . . relative bargaining power, the conspicuousness and comprehensibility of the contract language,[214] the oppressiveness of the terms,[215] and the presence or absence of a meaningful choice.”[216] Notably, courts have found a contract procedurally unconscionable if it constitutes a contract of adhesion.[217]
A contract of adhesion generally bears five qualities.[218] First, the contract appears on pre–printed forms included in the installation materials.[219] Second, it is used in consumer transactions in mass–market environments.[220] Third, it presents terms on a “take it or leave it” basis,[221] requiring an offeree to agree to the terms or forego the benefits of the contract.[222] Fourth, it is drafted in a generalized way,[223] and reflective of the party with superior bargaining powers’ interests.[224] Finally, the fact that the agreement constitutes a contract of adhesion does not necessarily render it procedurally and substantively unconscionable.[225]
Substantive unconscionability addresses the terms of the contract itself, and invalidates manifestly unfair provisions or clauses.[226] A substantively unconscionable contract term “shocks the conscience”[227] or egregiously and manifestly disadvantages the non–drafting party.[228] Both procedural and substantive unconscionability reflect the U.C.C. discussion of the term: “[t]he basic test is whether, in light of the general commercial needs of the particular trade or case, the clauses involved are so one–sided as to be unconscionable?”[229] Unconscionability “intentionally sets a high bar,”[230] and courts rarely find a contract term unconscionable.[231] A term more likely “shock[s] the conscience,”[232] however, as society more heavily invests in virtual worlds.[233]
MMORPG contracts that prohibit RMT activity clearly implicate the concerns engendered in the unconscionability doctrine. First, they constitute procedurally unconscionable contracts of adhesion. Many MMORPGs do not come in a box, many are not carried in traditional brick and mortar stores, and many are available only online.[234] If an MMORPG comes as software that a gamer purchases in a box, the outside of the box may include a disclaimer that software users must accept additional terms.[235] In the instance that an MMORPG has a manual, the designer likely prints the terms in the manual.[236] However, those understood terms change as the designer–gamer relationship develops, and the changing relationship does not necessarily reflect the current EULA, TOU, or TOS.[237]
A “clickwrap” or “browsewrap” license typically appears during the installation process.[238] A clickwrap agreement presents the EULA, TOU, or TOS in a window during the installation process.[239] The user is sometimes required to scroll through the entire text of the document before affirmatively clicking a button labeled “I agree” in order to proceed through the installation.[240] A browsewrap agreement presents a checkbox that the user must click to manifest assent in order to access a virtual world.[241] Next to the checkbox is a hyperlink that directs the installer to the text of the EULA, TOU, or TOS. Generally, courts enforce both types of agreements under ProCD,[242] even though consumers are less likely to view browsewrap license terms because they do not have to scroll through the agreement to proceed with installation.[243]
Both clickwrap and browsewrap formats constitute procedurally unconscionable contracts of adhesion when applied to MMORPGs. Common sense and personal experience remind us that most gamers do not read these contractual documents in their entirety.[244] The documents contain complicated legalese that the average gamer does not understand.[245] The documents are several pages long, and one document often requires that a gamer understand several other documents of equal length.[246] There is no negotiation, and gamers cannot modify the contracts. Without accepting the contracts’ terms, gamers cannot access the virtual environment.[247]
Gamers’ have no voice in contract formation: the only actively contracting party is the designer.[248] Designers can rely on their EULA, TOU, or TOS to defend their actions because the contracts contain broad, catch–all provisions.[249] To the extent that any gamers’ interest is represented in the contract, that interest is not the product of negotiation, but represents the designers’ decisions.[250] As such, MMORPG EULA contracts typically constitute procedurally unconscionable contracts of adhesion.[251]
Because courts analyze substantive unconscionability under a standard that asks whether a particular term shocks the court’s conscience, that determination will change as society becomes more invested in RMT activity.[252] Society presently invests, culturally and financially, in virtual worlds. Those investments will continue to increase as people and businesses explore virtual worlds and MMORPGEs. Courts should find provisions barring RMT egregiously unfair and substantively unconscionable.[253]
MMORPG designers increasingly encourage players to sell virtual chattels in RMT.[254] Sony recognized that it could not prohibit RMT activity, ultimately creating an online auction house for users to sell virtual chattels and currency for real money on certain servers.[255] Linden Lab encourages RMT activity in its Second Life environment.[256] The platform has proven wildly successful, and the population continues to increase rapidly.[257] Linden Lab provides an online currency exchange[258] and regularly sells virtual plots of land for thousands of dollars.[259] Large companies like MTV and ESPN actively incorporate their businesses into the Second Life environment.[260]
Some designers merely purport to grant gamers rights to virtual property secured in–game, both granting intellectual property rights to gamers and reserving the designers’ right to turn off their servers without liability.[261] Although Sony first banned RMT activity in Everquest,[262] it has since created an auction house where players can trade virtual objects for real money.[263] Ultima Online, a popular MMORPG, also encountered the widespread sale of virtual chattels on eBay and other auction houses.[264] The company chose to embrace the practice[265] in light of the rapidly increasing population of online gamers.[266]
Virtual currency, item, and character vendors abound on the Internet.[267] eBay dedicated a category to MMORPG chattels, currency, and characters.[268] Indeed, revenue derived from the virtual chattels sold in MMORPGEs is substantial.[269] For this reason, a designer eliminating these interests in a non–negotiated contract shocks the conscience.[270] Moreover, scholars and economists predict only increasing interest in virtual worlds, and to be subject to take–it–or–leave–it terms when such significant interests are at stake shocks the conscience.[271] Even when MMORPG designers purportedly grant gamers rights in their virtual property, designers often retain the right to delete such property without incurring liability.[272] Courts should find substantive unconscionability where designers attempt to regulate RMT through EULA contracts.
IV. Trespass to Gamers’ Virtual Chattels Secured in MMORPG Environments
Because MMORPG gamers acquire substantial property interests in virtual chattels secured in MMORPGEs, game designers destroy those chattels when they terminate accounts, turn off the server, or delete virtual assets pursuant to an RMT–prohibiting EULA. Part III argued that such behavior could not survive an unconscionability challenge. Absent this contractual hurdle, designers trespass on gamers’ chattels when they take such actions to prohibit RMT activity. Courts must be careful in defining the limits of gamers’ trepass to chattels cause of action to avoid anomalous results.
A. Applying the Cause of Action after Intel v. Hamidi [273]
Courts generally apply the Restatement definition where the chattel in question ultimately constitutes data on a hard drive or database.[274] According to that definition, a trespass to chattels occurs where one party “intentionally disposs[es] another of a chattel, or . . . us[es] or intermeddl[es] with a chattel in the possession of another.”[275] Liability results only if the trespasser dispossesses the possessor of the chattel, impairs the chattel’s condition, quality, or value, or deprives the possessor of the chattel for a substantial period.[276] As to the last option, the Restatement appears to not require physical, i.e., tangible, impairment.[277]
In eBay v. Bidder’s Edge,[278] the District Court for the Northern District of California applied the trespass to chattels doctrine to web spiders that retrieved data from databases owned by eBay.[279] The court concluded that the electronic communication between the spiders and eBay’s databases did not prevent the court from applying the trespass to chattels cause of action.[280] The court found Bidder’s Edge’s interference unauthorized,[281] and that Internet spiders “diminished the quality or value of eBay’s computer systems” within the meaning of the Restatement.[282]
Three years after eBay, in Intel v. Hamidi,[283] the California Supreme Court refused to find a trespass to chattels cause of action when an Intel employee repeatedly and without consent used Intel’s e–mail systems to send hundreds of thousands of e–mails to Intel employees.[284] The court stated that California’s laws on trespass to chattels do not—and should not—encompass an electronic communication that neither damages the recipient’s computer system nor impairs its functioning.[285]
Assuming that gamers have a legally cognizable property interest in virtual chattels secured in MMORPGEs,[286] designers commit trespass to chattels when they eliminate virtual assets to prevent RMT activity.[287] When a designer turns off his or her server, deletes assets or currency from that server, or deletes accounts to prohibit RMT activity, the designer—unlike Hamidi—deletes property owned by gamers or businesses entities engaged in virtual worlds.[288] The Intel court would have no trouble concluding that Hamidi committed trespass to chattels if he deleted valuable data on Intel’s servers.[289] Designers also eliminate fiscally valuable property interests when they delete gamer data.[290] This holding would recognize a new type of property interest and secure gamers’ rights against designers in MMORPGEs.
Courts could find, however, that gamers merely object to the content of designers’ actions and therefore cannot prove actionable harm.[291] The Intel court found that Intel’s complaint related predominantly to the content of Hamidi’s messages, rather than the chattel harm caused by those messages.[292] Intel proved no lost productivity resulting from Hamidi’s messages or any inability to use the e–mail system because of Hamidi’s messages.[293] Gamers or businesses entities that depend on virtual assets to continue in the ordinary course of play or business, however, lose productivity because they cannot continue their operations absent access to the virtual world. The court need not consider the tangibility of the property interest: designers clearly deny MMORPG participants use and possession in such instances. To the extent that the Intel court recognized that Intel actually objected to the content of Hamidi’s messages, a court could find that gamers actually object to the content of designers’ actions, without referencing harm.[294]
B. Crafting Limits to Trespass to Virtual Chattels: Excluding Intraworld Acts
Courts should carefully demarcate the limits to the trespass to chattels cause of action. In MMORPGEs, this would prevent subjecting both designers and gamers to unusual liability in MMORPGEs.[295] Expanding the trespass to chattels cause of action to encompass liability for acts occurring entirely within a virtual world would lead to anomalous results because many MMORPG platforms allow otherwise illegal activity.[296] For example, in Ultima Online, players can steal from others without violating the game rules.[297] In World of Warcraft, players regularly have the opportunity to steal, or “ninja,” items when playing with other players.[298] MMORPG platforms commonly encourage thievery, murder, group criminality, and other activity prohibited in the real world.[299]
Given that condition, it seems unreasonable for the law to allow one gamer to allege a trespass to chattels cause of action where the other gamer has acted entirely intraworld.[300] The trespass to chattels cause of action, applied to virtual chattels secured in–game, should encompass some act that begins outside the virtual environment but affects assets secured within the environment.[301] Designers who delete gamers’ accounts or assets to prevent RMT activity violate the rule: the deletion requires some real world action that externally affects the virtual world.[302] One player who steals a password or hacks into another player’s account violates this rule.[303] Courts must balance the inherent lawlessness of intraworld activity in MMORPGEs with the potential for anomalous trespass to chattels claims to encourage fruitful MMORPG development.[304]
The proposition that a trespass to virtual chattels cause of action necessarily encompasses an intra–world act emphatically highlights the struggle for legal scholars, and eventually the law, to understand how virtual worlds should fit within the rubric of American jurisprudence.[305] Should virtual worlds constitute jurisdictions of their own?[306] Should the First Amendment protect acts in a virtual world as speech, thereby pre–empting claims like trespass to chattels?[307] Should we wait for courts to address these issues or should the government regulate the contract terms that game designers present to gamers in an attempt to prevent gamers from entering into unconscionable contracts of adhesion?[308] Should federal or state governments criminalize behavior that occurs entirely within virtual worlds?[309] The inherent tension between gamers and designers’ interests must find a fair balance through the law.[310] Recognizing a trespass to chattels cause of action in certain intra–world circumstances constitutes one necessarily complex solution to that complicated problem.[311]
Virtual chattels have value as property that belongs to MMORPG gamers. Gamers and businesses inject their labor into MMORPGEs. Individuals and businesses bear constitutive and identificatory relationships with their avatars and the virtual chattels secured in MMORPGEs. Moreover, recognizing property interests in virtual chattels will create an incentive for businesses to invest in MMORPGEs, and for MMORPG designers to choose the United States instead of a more favorable jurisdiction. Given these property interests, MMORPG designers implement unconscionable EULA, TOS, and TOU contracts to prohibit RMT activity. In those contracts, designers may terminate accounts for engaging in RMT activity, or reserve the penultimate right to pull the plug on the virtual world. Considering MMORPG participants’ property interests and the unconscionable contracts designers employ to prevent RMT activity, courts should find that designers trespass upon gamers’ virtual chattels when they terminate accounts that engage in RMT activity. Nonetheless, courts must employ the trespass to chattels doctrine with caution to prevent anomalous results and to preserve the often desired lawlessness inherent in MMORPGEs.
* Associate Managing Editor, American University Law Review, Volume 57; J.D. Candidate, May 2008, American University, Washington College of Law; B.A., English, 2004, Boston College. Special thanks to the following individuals for their contributions to this thesis: Professor Mary Clark, for her invaluable guidance throughout the development of this topic, the staff members of the UC Davis Business Law Journal for their hard work in preparing this piece for publication, and my family and friends for their continued love and support.
[1] Raph Koster, A Declaration of the Rights of Avatars, http://www.raphkoster.com/gaming/playerrights.shtml (last visited Nov. 8, 2007).
[2] See Robert Hof, A Virtual World’s Real Dollars, Bus. Wk. Online, Mar. 28, 2006, http://www.businessweek.com/technology/content/mar2006/tc20060328_688225.htm?chan=technology_technology+index+page_more+of+today's+top+stories (describing financial appeal of building and selling, for real money, fictitious plots of land in three-dimensional, simulated virtual reality environment in which hundreds of thousands avatars reside).
[3] Shawn Elliot, Escort Mission, PC Mag., May 17, 2006, http://www.pcmag.com/article2/0,1895,1964618,00.asp (describing “Amster-Dame,” virtual red light district in Linden Lab’s Second Life virtual world, characterized by avatars that sell simulated sexual services from behind glass doors).
[4] See My Virtual Life, Bus. Wk., May 1, 2006, at 72 (examining Ansche Chung, avatar that established virtual real estate conglomerate that buys and sells plots of land in Second Life environment). The virtual real estate industry—buying and selling plots of land in virtual worlds—constitutes perhaps the most popular business enterprise in virtual worlds. See Paul Sloan, The Virtual Rockefeller, Business 2.0, Dec. 1, 2005, http://money.cnn.com/magazines/business2/business2_archive/2005/12/01/8364581/index.htm (explaining how Ansche Chung pays Linden lab about $200 per month, plus $1,250 one-time fee, for sixteen acre plots of virtual land that she develops using computer software or by hiring virtual subcontractors, and then sells or rents land to other Second Life residents).
[5] See Camille Dodero, Does Your Life Suck?, The Phoenix, July 17, 2006, http://www.thephoenix.com/article_ektid17440.aspx, for a comprehensive review of Linden Lab’s Second Life virtual world; see also Matt Gross, It’s My (Virtual) World and Welcome to It!, N.Y. Times, Nov. 3, 2006, at F1 (observing that users in Second Life can attend church in virtual environment); Michael Yessis, The Web Redefines Reality, USA Today, Nov. 15, 2006, at 9D (noting that Duran Duran hosts virtual concerts in Second Life environment).
[6] See David Pogue, An Experiment in Virtual Living, N.Y. Times, Feb. 22, 2007, at D01 (surveying personal and business ventures in Second Life).
[7] See Edward Castronova, Virtual Worlds: A First-Hand Account of Market and Society on the Cyberian Frontier, in 2 The Gruter Institute Working Papers on Law, Economics, and Evolutionary Biology 1 (2001), available at http://www.bepress.com/giwp/default/vol2/iss1/art1 [hereinafter Castronova, Cyberian Frontier] (defining virtual world as “the product of combining graphical 3D environment of games like Tomb Raider with chat-based social interaction systems developed in world of Multi-User Domains (MUDs)”); F. Gregory Lastowka & Dan Hunter, The Laws of Virtual Worlds, 92 Calif. L. Rev. 1, 5-6 (2004) [hereinafter Lastowka & Hunter, Laws of Virtual Worlds].
[8] See Caroline Bradley & A. Michael Froomkin, Virtual Worlds, Real Rules, 49 N.Y.L. Sch. L. Rev. 103, 121 (2005) (“Virtual worlds are more formally known as massively multi-player online role-playing games (“MMORPGs”)”).
[9] See Edward Castronova, The Price of “Man” and “Woman”: A Hedonic Pricing Model of Avatar Attributes in a Synthetic World 14 (CESifo Working Paper Series No. 957 2003), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=415043 (stating that avatar’s sex typically has no effect on its ability to acquire certain skills or abilities in virtual world, and that one in five MMORPG participants choose avatars of opposite sex).
[10] See Bradley & Froomkin, supra note 8, at 133 (describing “registered bond, promissory note, and commission agent” that facilitate land sale in MMORPG environment).
[11] David Smith, How to Get the Life You Really Want: Hundreds of Thousands of People Are Seeking Love, Fortune, and Happiness Through Their 2D Alter Egos in Second Life, a New Virtual World, The Observer(England), July 9, 2006, at 13; see Andrea L. Foster, Harvard to Offer Law Course in “Virtual World,” Chron. Higher Educ., Sept. 8, 2006, at 29 (justifying Harvard Law professor’s decision to teach class in Second Life environment on fact that architecture professors’ use environment to study building and design materials); Reena Jana, Starwood Hotels Explore Second Life First, Bus. Wk. Online, Aug. 23, 2006, http://www.businessweek.com/innovate/content/aug2006/id20060823_925270.htm (explaining how hotels can save money by first constructing potentially undesirable architectural or functional building elements in virtual world).
[12] See Bradley & Froomkin, supra note 8, at 132 (explaining how avatars make and sell shirts in Ultima Online MMORPG title).
[13] See James Grimmelmann, Virtual Worlds as Comparative Law, 49 N.Y.L. Sch. L. Rev. 147, 166 (2005) (positing that seasoned MMORPG avatars “signal their elite status” by acquiring rare items); see also Jack M. Balkin, Law and Liberty in Virtual Worlds, 49 N.Y.L. Sch. L. Rev. 63, 75 (2005) [hereinafter Balkin, Law and Liberty] (supporting claim that “defamation can occur in virtual worlds” by noting that reputation matters more as players continue to participate in same virtual world). Gamers acquire a constitutive relationship with their avatar identities, and reputation factors into that equation. See infra notes 139-42 and accompanying text (discussing why reputation implicates identity and why identity implicates legally cognizable property interests).
[14] Linden Lab not surprisingly titled its increasingly popular MMORPG environment “Second Life.” See infra notes 44-45 and accompanying text (explaining how avatars constitute “cyborg” identities that constitute extension of self and provide forum for, inter alia, creative self-expression).
[15] See Richard Siklos, A Virtual World But Real Money, N.Y. Times, Oct. 19, 2006, at C1 (identifying “big businesses” investing in Second Life environment, which is “fast becoming three-dimensional test bed for corporate marketers”); Giles Whittell, It’s Life But Not As We Know It As Web’s Future Takes Shape, Times (London), July 29, 2006, at 34 (describing real-world clothing producer American Apparel’s grand opening of “virtual mega-store” within Second Life environment).
[16] See Joshua A.T. Fairfield, Virtual Property, 85 B.U. L. Rev. 1047, 1048 (2005) (contending that law should apply traditional regulations and protections to computer code stimulating real world property); Andrew E. Jankowich, Property and Democracy in Virtual Worlds, 11 B.U. J. Sci. & Tech. L. 173, 176 (2005) (considering “questions of governance” in virtual worlds); Lastowka & Hunter, supra note 7, at 72 (arguing that virtual worlds constitute new jurisdictions with new laws); see also Jeremy Reimer, FBI, NCSoft Drop Hammer on MMORPG Pirates, Nov. 20, 2006, http://arstechnica.com/news.ars/post/20061120-8258.html (detailing “FBI sting” against fraudulent MMORPG servers).
[17] For an excellent history of online role-playing games and a broad review of related legal complexities, see Lastowka & Hunter, supra note 7, at 14-30 (reviewing MMORPG evolution from text-based online computer games to visual representational environments that persist when player exits game).
[18] See Edward Castronova, supra note 7, at 2, 3, 42 (concluding that at least $1,500,000,000 exchange hands in virtual worlds each year, and that virtual world in Sony’s Everquest had net worth greater than Bulgaria and higher gross national product per capita than India or China); Molly Stephens, Note, Sales of In-Game Assets: An Illustration of the Continuing Failure of Intellectual Property Law to Protect Digital-Content Creators, 80 Tex. L. Rev. 1513, 1514 (2002) (“The online-gaming market holds particular promise for investors because of potential market growth from the introduction of Internet-accessible game consoles and the emerging wide-spread availability of broadband access”).
[19] See Seth Schiesel, Online Game, Made in U.S., Seized the Globe, N.Y. Times, Sept. 5, 2006, at A1 (noting that Blizzard stands to reap over $1,000,000,000 in revenue and has 7,000,000 subscribers, making it one of most lucrative media properties of any kind); Nick Winfield, The Knights of Networking, Wall St. J., Oct. 5, 2006, at B1 (noting that Jagex Limited’s Runescape MMORPG has over 5,000,000 active players, 850,000 of whom pay five dollars per month to play).
[20] “Sony’s Everquest enjoys close to half a million subscribers in the U.S.” Beth Simone Noveck, The State of Play, 49 N.Y.L. Sch. L. Rev. 1, 8 (2004). Each subscriber pays a minimum fee of twelve dollars per month. Sony Entertainment, Accounts and Billing, http://everquestonlineadventures.station.sony.com/content.vm?page=Accounts%20and%20Billing (last visited Nov. 8, 2007).
[21] See Press Release, Blizzard Entertainment, World of Warcraft: The Burning Crusade Shatters Day-1 Sales Record (Mar. 30, 1998), available at http://www.blizzard.co.uk/press/070123.shtml (declaring that expansion to World of Warcraft environment “broke the day-one sales record to become the fastest-selling PC game ever”); Schiesel, supra note 19, at A1 (describing World of Warcraft as “one of the most lucrative media properties of any kind”). Blizzard declared that over nine million gamers subscribe to the World of Warcraft. Press Release, Blizzard Entertainment, World of Warcraft Surpasses 9 Million Subscribers Worldwide (July 24, 2007), available at http://www.blizzard.com/press/070724.shtml.
[22] Schiesel, supra note 19, at A1.
[23] See Blizzard Entertainment, General F.A.Q., http://worldofwarcraft.com/info/faq/general.html (last visited Nov. 8, 2007) (explaining one-time fifty dollar fee to purchase software and monthly charge that ranges from about thirteen to fifteen dollars per month).
[24] See Fairfield, supra note 16, at 1062 (valuing secondary market in virtual items at over $880,000,000, and noting rapid expansion).
[25] See Blizzard, General F.A.Q., supra note 23 (explaining that avatars in World of Warcraft use gold, silver, and copper virtual currency).
[26] See, e.g., EZgaming.com, Home Site, http://www.ezgaming.com/ (last visited Mar. 11, 2007) (offering virtual currency for, inter alia, World of Warcraft).
[27] See IGE, IGE Frequently Asked Questions, http://www.ige.com/FrequentlyAskedQuestions.aspx?lang=en&id=SellingCurrency (last visited Nov. 8, 2007) [hereinafter IGE FAQ] (offering to pay for virtual currency bank transfer, check, or money order).
[28] See Edward Castronova, Theory of the Avatar 3-4 (CESifo Working Paper Series No. 957, 2003), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=385103 (follow “Document Delivery” link) (“The physical representation of the self in virtual reality – the avatar – is an important aspect of the choice problem, as we would expect that people would gravitate toward those worlds that offer them their ideal avatars”).
[29] For an excellent description of this stage of transaction, and computer code behind it, see Molly Stephens, supra note 18, at 1516-19 (applying copyright analysis to computer code that transfers sword between avatars, and explaining relationship between designer server software and gamer client software).
[30] See, e.g., IGE, About Us, http://www.ige.com/about (last visited Mar. 11, 2007) (offering to purchase virtual currency from several MMORPGEs in exchange for real money, and offering to sell virtual currency at affordable prices).
[31] Square-Enix, Regarding Real Money Trade, http://www.playonline.com/ff11us/polnews/news3374.shtml (last visited Nov. 8, 2007) (defining “real money trade” and prohibiting gamers from selling “game currency, characters, or any other in-game items for real money or any other consideration for value”).
[32] See, e.g., Blizzard Entertainment, World of Warcraft Terms of Use Agreement 8, http://worldofwarcraft.com/legal/termsofuse.html (last visited Mar. 11, 2007) [hereinafter Blizzard, TOU] (prohibiting all RMT and third party programs that allow players more quickly to collect goods for purposes of engaging in RMT). Professor Jankowich concluded that 56.25% of MMORPGs surveyed prohibited players from selling virtual property acquired in-game. Jankowich, EULAw: The Complex Web of Corporate Rule-Making in Virtual Worlds, 8 Tul. J. Tech. & Intell. Prop. 1, 54 Annex A (2006) [hereinafter Jankowich EULAw].
[33] See Gary McGraw, When Does Security Cross the Line?, IT Architect, Dec. 1, 2005, at 106 (describing Blizzard’s “two pronged attack against cheaters”).
[34] See, e.g., Blizzard, World of Warcraft Accounts Closed, http://www.worldofwarcraft.com/news/wow-news-06-2006.html (last visited Nov. 8, 2007) (terminating accounts engaging in RMT).
[35] Posting of Florian Eckhardt to Kotaku, http://kotaku.com/gaming/world-of-warcraft/59000-gold-farmers-expelled-from-wow-190181.php (July 27, 2006).
[36] See, e.g., Davidson & Assoc. v. Jung, 422 F.3d 630, 640 (finding that gamers who developed alternate servers for Blizzard titles violated Digital Millennium Copyright Act’s circumvention provision).
[37] Id.
[38] See A.H. Rajani, Note, Davidson & Associates v. Jung: (Re)interpreting Access Controls, 21 Berkeley Tech. L.J. 365, 388 (2006) [hereinafter Rajani, Access Controls] (finding that game designers effectively have “secured the right to host their games exclusively”).
[39] See supra notes 21-22 and accompanying text.
[40] See supra notes 19-21 and accompanying text.
[41] See Jack M. Balkin, Virtual Liberty: Freedom to Design and Freedom to Play in Virtual Worlds, 90 Va. L. Rev. 2043, 2070-72 (2004) [hereinafter Balkin, Virtual Liberty] (predicting that commoditization of virtual property will result in litigation).
[42] See Greg Sandoval, Sony to Ban Sale of Online Characters From Its Popular Gaming Sites, CNET News.com, Apr. 10, 2000, http://www.news.com/Sony-to-ban-sale-of-online-characters-from-its-popular-gaming-sites/2100-1017_3-239052.html?tag=item (explaining that Sony was first to prohibit MMORPG character sale in 2000).
[43] See Fairfield, supra note 16, at 1084-85 (identifying “nascent regimes” in China and Taiwan that recognize property rights in virtual chattels, in addition to competing with those regimes in United States).
[44] See generally Castronova, supra note 28 (exploring identity relationships between gamers and avatars, and reasons that players choose avatars of opposite sex).
[45] See Blizzard Entertainment, World of Warcraft Manual 11-12 (2004).
[46] See id. at 14 (reminding players that game prohibits cross-faction communication).
[47] Id.
[48] Id.
[49] See, e.g., id. (selecting rogue class grants avatars abilities to hide from and pickpocket other characters).
[50] Id. at 20-21.
[51] Id.
[52] Id.
[53] See Jankowich, Property and Democracy, supra note 16, at 183 (“There's no shortage of realism in this game—the trouble is, many of the nonviolent activities in [Ultima Online] are realistic to the point of numbingly lifelike boredom: If you choose to be a tailor, you can make a passable living at it, but only after untold hours of repetitive sewing.” (quoting Amy Jo Kim, Killers Have More Fun, Wired, May 1998, http://www.wired.com/wired/archive/6.05/ultima.html (last visited Aug. 11, 2006)).
[54] Blizzard Entertainment, World of Warcraft Manual, supra note 45, at 96-103.
[55] Id. at 114.
[56] See Cory Ondrejka, Escaping the Gilded Cage: User Created Content and Building the Metaverse, 49 N.Y.L. Sch. L. Rev. 81, 99 (2004) (“PlayerAuctions, a site that grew as a result of eBay's ban on EverQuest items, boasts over 100,000 members”).
[57] See Jankowich, EULAw, supra note 32, at 5 (introducing such contracts as laws that “create private rules in the absence of effective jurisdiction by real world governments”).
[58] See id. at 10 (“These agreements, governed by real world law, are the primary instrument of law employed by proprietors in the virtual world”).
[59] See Richard Bartle, Virtual Liberty: Freedom to Design and Freedom to Play in Virtual Worlds, 90 Va. L. Rev. 2043, 2047-48 (2004) (arguing that game designers have freedom to design virtual worlds and establish its rules according to game designers’ intentions, and that this freedom implicates First Amendment freedom of speech).
[60] See Raph Koster, The Laws of Online World Design, Website, http://www.raphkoster.com/gaming/laws.shtml (last visited Mar. 11, 2007) (“A roleplay-mandated world is essentially going to have to be a fascist state”). Raph Koster is a Chief Creative Officer with Sony Entertainment who designs MMORPG titles. Id.
[61] See Jankowich, EULAw, supra note 32, at 11 (reminding that designers cannot incorporate all desired restrictions into MMORPG environment by including those restrictions in EULA). But cf. Lawrence Lessig, Code and Other Laws of Cyberspace 6 (2000) (arguing that on internet, “code is law,” and that neither designers nor law can regulate that which they cannot write as code).
[62] Compare Blizzard Entertainment, World of Warcraft Accounts Closed, June 9, 2006, http://www.worldofwarcraft.com/news/wow-news-06-2006.html (terminating over thirty thousand accounts and reminding that “selling World of Warcraft content, such as gold, items, and characters, can result in permanent bans of involved accounts from World of Warcraft”), and Square Enix, Final Fantasy XI User Agreement, July 1, 2004, 3.1(a), https://secure.playonline.com/supportus/index03.html (follow “FINAL FANTASY XI User Agreement” link) (prohibiting RMT transactions, virtual gambling, intellectual property right infringement, harassment, and cheating), with Linden Lab, IP Rights, http://www.secondlife.com/whatis/ip_rights.php (last visited Mar. 11, 2007) (“Linden Lab's Terms of Service agreement recognizes Residents' right to retain full intellectual property protection for the digital content they create in Second Life, including avatar characters, clothing, scripts, textures, objects and designs. This right is enforceable and applicable both in-world and offline, both for non-profit and commercial ventures. You create it, you own it—and it's yours to do with as you please”); Linden Lab, Terms of Service, 1.5, http://www.secondlife.com/corporate/tos.php (last visited July 10, 2006) [hereinafter Linden Lab, TOS] (providing currency exchange called LindeX, where players can transfer rights to Second Life virtual currency for real money), and There.com, Overview on Copyrights, http://info.there.com/idx/0/788/article/Overview_on_Copyrights.html (last visited Nov. 7, 2007) (granting intellectual property rights to “developer status” members but not to “basic members”).
[63] See, e.g., Anarchy Online, Rules of Conduct Within Anarchy Online, 6, http://anarchy-online.com/content/corporate/rulesofconduct.html (last visited Oct. 7, 2006) (“You will always follow the instructions of authorized personnel while in Anarchy Online.”), cited in Jankowich, EULAw, supra note 32, at 9; Blizzard, TOU, supra note 32, at 5(C)(3) (prohibiting “[a]nything that Blizzard considers contrary to ‘essence’ of World of Warcraft”).
[64] See Balkin, Law and Liberty, supra note 13, at 66 (“Although the freedom to play generally exists within the rules of the game, platform owners may run their spaces in ways that the players believe are unfair or tyrannical. As a result, claims about the platform owners’ freedom to design may clash with players' claims about the freedom to play, and the law may have to arbitrate between them”).
[65] See Balkin, Virtual Liberty, supra note 41, at 2050-51 (introducing “freedom to play,” “freedom to design,” and “freedom to design together”); see also Fairfield, supra note 16, at 1050 (“[H]olders of intellectual property rights have been systematically eliminating emerging virtual property rights by the use of contracts called [EULAs]”).
[66] See Jankowich, EULAw, supra note 32, at 54-57 Annex A (charting account, identity, speech, property, behavior, liability, privacy, and participant rights clauses in MMORPG EULAs).
[67] See, e.g., Blizzard, TOU, supra note 32, at 1(B) (requiring that participant provide his or her name, address, and phone number).
[68] See, e.g., id. at 3(A) (prohibiting, inter alia, user names that incorporate profanity).
[69] See, e.g., id. at 3(B)(ii) (prohibiting “[c]arry[ing] out any action with a disruptive effect” on chat screen).
[70] See Brian Chase, When the Pen is Mightier Than the (Magic) Sword, http://www.lambdalegal.org/our-work/publications/page.jsp?itemID=32007393 (last visited Oct. 7, 2006) (describing cease and desist letter sent to Blizzard after company suspended user who discussed sexuality in-game); see also Jose Antonio Vargas, For Gay Gamers, A Virtual Reality Check, Wash. Post, Mar. 11, 2006, at C01 (discussing lesbian, gay, bisexual, and transvestite MMORPG players).
[71] See Bradley & Froomkin, supra note 8, at 123 (discussing Ultima Online’s economy based on developing and improving property and trading goods). Time invested by economists researching economies of virtual worlds buttresses this legitimate designer interest. See Castronova, Cyberian Frontier, supra note 7, at 2 (noting that “economists and other social scientists will become interested in Norrath and similar virtual worlds as they realize that such places have begun to mean great deal to large numbers of ordinary people”).
[72] See Jankowich, EULAw, supra note 32, at 54 Annex A (noting that 56.25% of virtual worlds prohibit sale of virtual property); see also id. (noting that 72.92% of virtual world proprietors claim all intellectual property in virtual world).
[73] See id. (calculating that 95.83% of virtual worlds implement a property-based economy); see also Bradley & Froomkin, Virtual Worlds, Real Rules, supra note 8, at 133 (“No virtual world, not even a community-conscious, social MUD like LambdaMOO, has an entirely communal property system”).
[74] See Jankowich, EULAw, supra note 32, at 9 (coining term “EULAw” as body of contractual provisions that designers implement to impose real law limitations on virtual world activities).
[75] See Blizzard, TOU, supra note 32, at 8 (discussing how Blizzard does not recognize any property claims outside World of Warcraft or “the purported sale, gift or trade in the ‘real world’ of anything related to World of Warcraft”).
[76] See Jankowich, EULAw, supra note 32, at 54 Annex A (calculating that while 33.33% of proprietors claim all property, 72.92% claim all intellectual property).
[77] See Jankowich, EULAw, supra note 32, at 54 Annex A (calculating that 47.92% of proprietors prohibit software sale).
[78] See id. (finding that 41.67% of polled MMORPGEs allow designer to terminate world at will, and that virtual world proprietor can terminate participant’s account at its discretion).
[79] To the extent that an MMORPG EULA represents a designer interest in prohibiting RMT-activity, MMORPG EULAs undercut significant gamer investments in the world. See infra Part II (discussing how gamers have significant property interests in property secured in virtual worlds under Lockean, utilitarian, and personhood property theories).
[80] The virtual property inquiry is not limited to American jurisprudence. See infra notes 113-15 (discussing Chinese, Taiwanese, and Korean law and virtual property).
[81] See supra notes 21-22 and accompanying text.
[82] See, e.g., MMOBids.com, About Us, http://www.mmobids.com/aboutus.php (last visited Mar. 11, 2007); Lewt.com, About Us, http://www.lewt.com/about-us/ (last visited Mar. 11, 2007).
[83] See Edward Castronova, A Cost-Benefit Analysis of Real-Money Trade in the Products of Synthetic Economies, Info, Oct. 2006, available at http://ssrn.com/abstract=917124 (follow “Download Document” link) [hereinafter Castronova, Cost-Benefit Analysis] (predicting that increasing interest in online gaming would result in $100,000,000 in annual RMT); see also id. at 37 n.2 (projecting that online video game revenue will rise “from $1.9 billion in 2003 to $9.8 billion in 2009”).
[84] See Balkin, Virtual Liberty, supra note 41, at 2046 (arguing that increasing virtual property commoditization will result in increased potential legal regulations of virtual worlds).
[85] See id. at 2046-47 (hypothesizing First Amendment claims that result from tension between gamers’ freedom to play in virtual worlds, and designers’ freedom to design them, but finding that Congress must implement legislation to protect virtual speech interests).
[86] Courts overseas have ruled that virtual assets acquired in online gaming environments constitute legally cognizable property. See generally Fairfield, supra note 16, at 1084-89 (reviewing lawsuits, decisions, and regulations in China, Taiwan, and South Korea). But see infra Part IV (explicating how causes of action to protect virtual property rights must have constraints that prevent criminalizing entirely in-world activity conducted pursuant to game norms).
[87] Blacksnow Interactive v. Mythic Entertainment, Inc., No. 02-CV-00112 (C.D. Cal. filed 2002), cited in Julian Dibbell, The Unreal Estate Boom, Wired, Jan. 2003, http://www.juliandibbell.com/texts/blacksnow.html (briefing Mythic case).
[88] Dibbell, supra note 87.
[89] See id. (reminding that Dark Age gold piece and Russian ruble are comparably valuable).
[90] Id.
[91] Id.
[92] Id.
[93] Id.
[94] Bragg v. Linden Lab, No. CV-7606 (Pa. Magis. Dist. Ct. May 2, 2006).
[95] See Linden Lab, Makers of Second Life, http://lindenlab.com/ (last visited Oct. 7, 2006) (describing Second Life as “burgeoning new online society”).
[96] See Kathleen Craig, Second Life Land Deal Goes Sour, Wired, May 18, 2006, available at http://www.wired.com/news/culture/0,70909-0.html?tw=rss.index (calculating Bragg’s virtual property at about $3,900).
[97] Linden Lab, TOS, supra note 62, at 3.2.
[98] See id. at 2.6 (stating that users do not receive refund or exchange for any virtual property created in Second Life).
[99] See id. at 3.3 (declaring that participant owns no data that designer uses to represent gamer content).
[100] See Complaint at 1, Bragg v. Linden Lab, No. CV-7606 (Pa. Magis. Ct. May 2, 2006) (alleging “breach of contract, conversion, [and] interference with contractual relations”).
[101] See Linden Lab, TOS, supra note 62, at 2.6 (allowing Linden Lab to terminate gamer accounts without cause, warning, or process).
[102] See Ruckelshaus v. Monsanto Co., 467 U.S. 986, 1003 (1984) (applying Locke’s Second Treatise and stating that property arises from labor), cited in Adam Mossoff, Locke’s Labor Lost, 9 U. Chi. L. Sch. Roundtable 155, 155 & 155 n.1 (2002) (claiming that Supreme Court has cited no other philosophy text as justifying legal proposition); Justin Hughes, The Philosophy of Intellectual Property, 77 Geo. L.J. 287, 351 (1988) (attaching Locke’s theory to “generations of students,” and applying labor theory to intellectual property interests).
[103] See Hughes, supra note 102, at 297 (explicating that bounty of goods that humans must convert through labor into property originates from God).
[104] See A. John Simmons, A Lockean Theory of Rights 222-23 (1992) (describing Locke’s labor-for-property thesis as “intuitive”); Daniel J. Caffarelli, Note, Crossing Virtual Lines: Trespass on the Internet, 5 B.U. J. Sci. & Tech. L. 6, para. 10 (1999) (“Conversely, all unclaimed resources belong to society in common”).
[105] See John Locke, Two Treatises on Government 128 (Mark Goldie, ed., 1993) (“The labour of his body, and work of his hands, we may say, are properly his.”).
[106] See id. at 137 (“Thus labor, in the beginning, gave right of property, wherever anyone was pleased to employ it, upon what was common, which remained, long while, far greater part, and is yet more than mankind makes use of”).
[107] See Hughes, supra note 102, at 297 (positing that labor can add value to goods simply by allowing humans to use them).
[108] See Locke, supra note 105, at 133 (stating that labor alters intrinsic value of thing because its value depends upon usefulness).
[109] See, e.g., Int’l News Serv. v. Assoc. Press, 248 U.S. 215, 239 (1918) (prohibiting that one “reap where it has not sown”).
[110] Pierson v. Post, 3 Cai. R. 175 (N.Y. Sup. Ct. 1805).
[111] See id. at 178 (recognizing property interest applicable to person who injects labor sufficient to wound, trap, or kill animal, but finding mere sight or pursuit insufficient to constitute property interest); City of San Marcos v. Tex. Comm’n on Envtl. Quality, 128 S.W.3d 264, 270 (2004) (applying Pierson v. Post rule of capture to groundwater). But cf. Pierson, 3. Cai. R. at 182 (Livingston, J., dissenting) (arguing that law should reward property interest to person who undertakes pursuit through “waste and unoccupied lands”).
[112] In Li Hongchen v. Beijing Arctic Ice Technology Development Co., appellate court ordered virtual property taken by third party returned to gamer and recognized that gamer owned his virtual chattels. See Fairfield, supra note 16, at 1085 (“The action quieted title in virtual property in its rightful”).
[113] On-Line Game Player Wins Virtual Properties Dispute, Xinhua General News Service, Dec. 19, 2003.
[114] Fairfield, supra note 16, at 1087. Taiwanese courts have ruled on virtual property theft, fraud, and robbery, causes of action defined by statute. See id. at 1087-88 (noting that authorities routinely prosecute under virtual property theft statute).
[115] Id. But cf. id. at 1061 (finding that in South Korea, where environment alone hosts 17,000,000 subscribers, attempts to resolve virtual property disputes by applying already existing criminal and antitrust laws).
[116] The facts in Pierson reflect similar circumstances in other MMORPGEs, where players hunt animals like foxes, skin and remove their hides, and acquire virtual currency.
[117] See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 46-47 (“And as anyone who has slaved over a virtual forge will tell you, creating virtual-world property can involve at least as much tedium as any real-world work”); see also Posting of Nick Yee to The Daedalus Project, http://www.nickyee.com/daedalus/archives/000891.php (January 11, 2005) (finding that MMORPG gamers spend more time playing in virtual worlds than watching television).
[118] See The End Is Virtually Nigh, Economist, Dec. 10, 2005 (“Devoted MMORPG fans spend dozens of hours a month building up their characters, and live what is, in effect, a parallel life in another world”). This participation sometimes harms real world relationships. See World of Warcraft Widows Website, http://games.groups.yahoo.com/group/WOW_widow/ (last visited Mar. 11, 2007) (providing group support services for persons whose significant others left them to play World of Warcraft).
[119] See, e.g., IGE, About Us, supra note 30 (allowing gamers to trade, buy, and sell virtual assets and currency, as part of effort to give gamers more avenues for enjoying MMORPG titles).
[120] See IGE, IGE FAQ, supra note 27 (offering to buy and sell virtual currency from and to gamers).
[121] Cf. Caffarelli, supra note 104, at ¶ 11 (“In the same way that landowner's improvements increase the value of real property, programmer's development of site increases value of Internet, or the specific address of newly created Web site”).
[122] Cf. id. (finding that property interest in web sites would render more valuable unused internet space).
[123] See Danny Bradbury, Virtual Insanity, The Independent (London), Aug. 9, 2006, at 8 (describing currency-farming operations in MMORPGEs that “repeat the same action in an infinite loop” to secure assets).
[124] For example, gamers mine ore in World of Warcraft from veins in the virtual earth. Once a player uses a mining vein, the vein disappears. However, the vein reappears after a certain period, at which point the player can mine ore again. See Caffarelli, supra note 104, at para. 11 (promoting property rights in web sites because web developers cannot exhaust common resources). But see id. (finding that law should recognize property interest in websites because new site does not infringe upon others’ rights in existing property). Designers have property interest in virtual world, especially in that they created it. However, designers cannot deny gamers’ rights to property secured in-game as society continues to invest in RMT activities.
[125] See Simmons, supra note 104, at 242-43 (explaining that prior rights each person possesses in his or her person, mixed through labor with unowned commons, constitutes property).
[126] Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 38.
[127] See, e.g., IGE Home Page, http://www.ige.com/ (last visited October 16, 2007) [hereinafter IGE, Home Page] (allowing visitors to buy, sell, trade, and donate virtual assets in eight MMORPGEs).
[128] See Eye on MOGs Home Page, http://www.eyeonmogs.com/ (last visited October 16, 2007) (offering virtual chattels from thirty-two games, from twenty-four providers, in 81,635 separate listings).
[129] Mike Musgrove, Virtual Gaming Economy, Wash. Post, Sept. 20, 2006, at A1.
[130] See infra Part II.C and accompanying text (arguing for utilitarian justification for MMORPG virtual property).
[131] Margaret Jane Radin, Property and Personhood, 34 Stan. L. Rev. 957, 958 (1981).
[132] Id. at 957.
[133] See Caffarelli, supra note 104, at ¶ 14 (interpreting Radin’s theory as focused on an individual’s ability to control “the resources in her environment [in order] to develop completely as a person”); Radin, Property and Personhood, supra note 131, at 959-60 (identifying house or wedding ring as property with which an individual has constitutive relationship).
[134] Radin, Property and Personhood, supra note 131, at 959; cf. Caffarelli, supra note 104, at 959 (noting that amount of pain person experiences “provides a measure of the strength of the connection between the person and the property” and applying that theory to justify property interest in websites).
[135] See Caffarelli, supra note 104, at ¶¶ 14-15 (concluding that law should grant broad private property rights where property defines one’s personhood).
[136] See Bleistein v. Donaldson Lithographing Co., 188 U.S. 239, 250 (1903) (finding that “a very modest grade of art has in it something irreducible, which is one man’s alone . . . [t]hat something he may copyright”). American copyright law constitutes one enduring example of personality operating as a justification for law in the United States. See Hughes, supra note 102, at 351 (1988) (noting that copyright law protects owners’ rights to have public recognize their identity as creator, and creates right to protect creation from changes that might injure author’s reputation).
[137] See Javins v. First Nat’l Realty Corp., 428 F.2d 1071, 1077 (1970) (finding common law obligation that landlord maintain his or her premises in habitable condition by incorporating contract law theories).
[138] See Susan P. Crawford, Who’s In Charge of Who I Am?: Identity and Law Online, 1 N.Y.L. Sch. L. Rev. 211, 214 (2004) (recognizing that identity constitutes product of world that individual inhabits); see also Richard Bartle, Designing Virtual Worlds 159 (New Riders Games 2003) (declaring identity “absolutely core point of virtual worlds”).
[139] See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 63 (explaining that an avatar can allow its controller to experiment with identity, expression, and desire). MTV currently beta tests its own virtual world, Virtual Laguna Beach. See Richard Siklos, Not in the Real World Anymore, N.Y. Times, Sept. 18, 2006 (detailing MTV’s plan to allow gamers to engage virtual environment where they assume likeness of young, wealthy character from popular reality television series).
[140] See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 65 (reminding that while avatars constitute “masks,” gamers do not consider their avatars completely distinct from their real identities).
[141] See Crawford, supra note 138, at 213 (defining identity as a product of others’ perceptions).
[142] See id. (“Identity and reputation go hand in hand, as individuals gain reputations that are connected to particular contexts and groups”).
[143] See Cameron England, Like WoW Wipeout, The Advertiser (Australia), June 23, 2006, at 19 (describing suspended death sentence issued by Shanghai court when Legend of Mir 3 gamer stabbed another player to death after he stole and sold murderer's virtual sword for reported $1175); see also Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 63-64 (describing gamers’ real anger and humiliation when his or her avatar receives representational injury).
[144] That players may elect to sell the items with which they have an important constitutive relationship does not denigrate their personhood interest in virtual property. While homes constitute archetypal personhood interests, persons nonetheless elect to sell their homes. See Radin, Property and Personhood, supra note 131, at 959-60 (discussing pain experienced with loss of home). When Blizzard recently created an “Armory” that allows any player to view all the possessions and skills of another player by using a website, many players reacted by objecting to an invasion of their privacy, while others countered that gamers have no valid objection where they do not on the data that constitutes their character. Compare Posting of Selenia to http://forums.worldofwarcraft.com/thread.html?topicId=79628029&sid=1&pageNo=27 (last visited Mar. 10, 2007) (“Violated is exactly how I feel.”), with Posting of Kharthus to http://forums.worldofwarcraft.com/thread.html?topicId=79628029&sid=1&pageNo=27 (last visited Mar. 10, 2007) (“The data was never yours to begin with and hence privacy doesn’t even come into play”).
[145] See Mary L. Clark, Reconstructing the World Trade Center: An Argument for the Applicability of Personhood Theory to Commercial Property Ownership and Use, 109 Penn St. L. Rev. 815, 821-22 (2005) [hereinafter Clark, World Trade Center] (describing workplace as “home away from home”). The law recognizes that businesses acquire personhood interests when it grants copyright protections to business entities. See Bleistein v. Donaldson Lithographing Co., 188 U.S. 239, 250 (1903) (recognizing that personality justified copyright protections, and extending those protections to multiple plaintiffs).
[146] See Clark, World Trade Center, supra note 145, at 822 (“The emphasis on the personhood implications of realizing personal goals through property is no less true of commercial property than personal property, and should be recognized by the law as playing a critical role in both realms”).
[147] Id. at 821.
[148] See Posting of Jun-Sok Huhh to Virtual Economy Research Network, http://virtual-economy.org/blog/ (follow “IGE, Ready to sweep the Korean RMT market?” link) (Sept. 6, 2006, 11:45) (explaining how virtual chattels conglomerate IGE recently purchased Korean RMT business for about $4,700,000).
[149] See My Virtual Life, supra note 4 (explaining how the virtual real estate mogul recently opened ten person offices in Wuhan, China, to manage over $250,000 in virtual asset holdings).
[150] See, e.g., IGE, Home Page, supra note 127 (offering chattels and currency in sixteen different MMORPG titles).
[151] See Sony Entertainment, Station Exchange: The Official Secure Marketplace for EverQuest II Players, http://stationexchange.station.sony.com (last visited Mar. 11, 2007) (opening designer-sanctioned online auction for “the right to use in-game coin, items, and characters”); cf. UO Game Code Store, http://www.uogamecodes.com/store/prod_detail.asp?ProdID=UOADVCHAR (last visited October 3, 2006) (allowing Ultima Online players to purchase advanced avatars to avoid playing for hours to secure rare virtual artifacts or large amounts of currency). One student characterized Sony’s decision as an “about-face.” Rajani, Access Controls, supra note 38, at 392.
[152] See Richard A. Bartle, Virtual Wordliness: What the Imaginary Asks of the Real, 49 N.Y.L. Sch. L. Rev. 19, 27 (2004) (noting that if designers did not retain exclusive rights over virtual world, world would become outdated and overrun with system exploits).
[153] See Balkin, Law and Liberty, supra note 13, at 64-65 (describing designers’ “freedom to design” virtual worlds, and players “freedom to play” within designers’ vision). Balkin defines right to play as contingent upon and constituted by the right to design. Id.
[154] See Blizzard, TOU, supra note 32, at 3(C)(v) (prohibiting anything contrary to “essence” of World of Warcraft). Blizzard also recognizes community personhood interests when it claims that RMT activity constitutes cheating and unfairly treats other gamers. See Blizzard Entertainment, Selling World of Warcraft In-Game Content for Real Money, Dec. 10, 2004, http://www.worldofwarcraft.com/news/wow-news2004.html (discouraging RMT to avoid damaging “the overall experience” for other gamers).
[155] See Blizzard, TOU, supra note 32, at 3(C)(8) (last visited Aug. 11, 2006) (“Note that Blizzard Entertainment either owns, or has exclusively licensed, all of the content which appears in World of Warcraft.”).
[156] See Clark, World Trade Center, supra note 145, at 823, 827-28 (concluding that decommodification of land representing original World Trade Center tower footprints recognizes personhood attachments of persons who worked and died there).
[157] Cf. Mary L. Clark, Keep Your Hands Off My (Dead) Body: A Critique of the Ways in Which the State Disrupts the Personhood Interests of the Deceased and His or Her Kin in Disposing of the Dead and Assigning Identity in Death, 58 Rutgers L. Rev. 45, 71-72 (2005) (finding an offense to personhood interests where state requires deceased’s designee to pay embalming costs, without regard to either party’s “sense of bodily and spiritual integrity”).
[158] See Dominic Rushe, Fantasy Game Turns Internet into Goldmine, Sunday Times (London), Sept. 17, 2006, at 9 (describing planned online funeral service for Australian television star Steve Irwin).
[159] See Steven Levy, Living a Virtual Life, Newsweek, Sept. 18, 2006, at 48 (describing funeral killings as “questionable” and quoting Blizzard’s president discrediting action).
[160] See id. (noting that 80,000 people have viewed funeral video footage on YouTube). Comments following YouTube footage debate whether or not assaulting a virtual funeral causes real pain. Compare Posting of RMacPac to YouTube, http://youtube.com/watch?v=0OXlKCTn2_0 (last visited Oct. 4, 2006) (appreciating funeral attempt but noting that “it’s a game”), with Posting of Venomavp to YouTube, http://youtube.com/comment_servlet?all_comments&v=0OXlKCTn2_0&fromurl=/watch%3Fv%3D0OXlKCTn2_0 (last visited Oct. 4, 2006) (“It seems pathetic that honor and respect is generated by disrespecting and disturbing an emotional event”).
[161] See Clark, World Trade Center, supra note 145, at 823, 827-28.
[162] Bentham’s principle does not constitute an enigma in American law. See, e.g., U.S. Const. art. I, § 8 (“The Congress shall have power to . . . provide for the common defense and general welfare of the United States”).
[163] See Jeremy Bentham, The Theory of Legislation 113 (C. K. Ogden ed., Richard Hildreth trans., 1950) (1802) (reasoning that property constitutes legal construction, not natural right, such that security in property results when something does not confuse or complicate our expectations founded upon law), cited in Caffarelli, supra note 104, at ¶ 12.
[164] J. Bentham, A Fragment on Government, in 1 The Works of Jeremy Bentham 221, 227 (J. Bowring ed. 1962).
[165] See Bentham, supra note 163, at 113 (explaining that when legislator disturbs legitimate expectations about property, “he always produces a proportionate sum of evil”).
[166] Nuisance law draws on the principle sic utere tuo et alienum non laedas, which warns against using one’s property so as to harm another, to prevent certain property uses that society finds unappealing. See Prah v. Maretti, 108 Wis.2d 223, 252 (1982) (finding proposed home construction to constitute nuisance that would preclude sun from reaching plaintiff’s solar heating panels). Courts apply an ad hoc, fact-specific balancing test that weighs the gravity of the harm to the non-nuisance actor against the social utility of the nuisance actor’s conduct. See Spur Indus. v. Del Webb Dev. Co., 108 Ariz. 178, 184 (1972) (finding defendant’s cattle feeding lots, owned before plaintiff constructed residential development, constituted public and private nuisance because defendant’s feedlots created odor, flies, and affected public’s health). The Spur court required the plaintiff to indemnify the defendant because the plaintiff “brought people to the nuisance.” Id. at 186. To the extent that gamers come into the nuisance by knowingly engaging in RMT where an EULA prohibits such activity, gamers indemnify designers by paying monthly subscription fees to use the service. See id. (requiring that Spur move “not because of any wrongdoing[,] . . . but because of a proper and legitimate regard of the courts for the rights and interests of the public”); Restatement (Second) of Torts § 821F cmt. e (including location and characteristics of community in nuisance calculations).
[167] See Herbert Hovenkamp & Sheldon F. Kurtz, The Law of Property § 11.1 (5th ed. 2001) (“The essential basis for liability in a private nuisance action is the interference with [another’s] use and enjoyment of land”). Some scholars argue that the primary justification for intellectual property law has utilitarian roots. See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 44-45 (arguing that scholars who debate whether American law too broadly or too narrowly grants intellectual property rights implement Bentham’s felicific calculus).
[168] Hovenkamp & Kurtz, supra note 167, § 11.1.
[169] See Prah, 108 Wis.2d at 231 (explicating that “the defendant’s privilege of making a reasonable use of his own property for his own benefit and conducting his affairs in his own way” is correlatively related to “plaintiff’s right to use and enjoy his premises,” thereby mandating that courts make “a comparative evaluation of the conflicting interests” at stake (citing Prosser, Law of Torts § 89 (2d ed. 1971))).
[170] See supra note 18 and accompanying text.
[171] See, e.g., Andrew Lavallee, Now, Virtual Fashion, Wall St. J., Sept. 22, 2006, at B1 (explaining that top twenty Second Life residents who sell virtual garments secured $140,466 in nonvirtual profits).
[172] See Charles Nesson, Rebecca Nesson, & Gene Koo, CyberOne: Law in the Court of Public Opinion, September 22, 2006, http://blogs.law.harvard.edu/cyberone (hosting law school class in Second Life virtual world).
[173] See Balkin, Virtual Liberty, supra note 41, at 66 (“Although players make the initial choice of where to play, over time they often invest considerable time and energy in the game world and in their in-world identities”); James Grimmelman, Virtual Power Politics 8 (2005), available at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=707301#PaperDownload (“Ultimately, players’ power over designers depends on their ability go nuclear, to stop playing and stop paying. It’s a powerful threat, but costly for a player who has built up substantial in-game wealth or status, and each player can only quit once”).
[174] Grimmelman, supra note 173, at 8.
[175] See supra notes 173-74.
[176] Cf. Prah v. Maretti, 108 Wis.2d 223, 231(1982) (finding that obstruction of access to light could constitute private nuisance). But cf. Fontainebleau Hotel Corp. v. Forty-Five Twenty-Five, Inc., 114 So. 2d 357, 360-61 (Fla. Dist. Ct. App. 1959) (finding no property right in light and air, and no nuisance in erecting building that cast shadow over adjacent beachside hotel).
[177] See Balkin, Virtual Liberty, supra note 41, at 65 (positing that designers create and enforce rules through EULA contracts).
[178] Sony elected to create certain “shards,” or servers for its Everquest platform, that allow RMT activity. See infra notes 256 and accompanying text.
[179] Cf. Caffarelli, supra note 104, ¶ 13 (applying Benthamist principles to conclude that laws that promote personal property interest in websites provide security to site owners, provide incentive to others interested in investing in websites, and encourage creative expansion of internet).
[180] See Fairfield, supra note 16, at 1063 (finding that virtual environments fail to confer benefit on society if law fails to protect property interest in virtual property).
[181] See Linden Lab, The Marketplace, available at http://secondlife.com/whatis/marketplace.php (last visited Oct. 7, 2006) (“Second life has a fully-integrated economy architected to reward risk, innovation, and craftsmanship”).
[182] See Fairfield, supra note 16, at 1089 (concluding, after reviewing emerging codified and judicial virtual property regimes in other countries, that number of people invested in virtual worlds will increase, that virtual property law creates investment incentives for virtual world residents, that those residents will chose country most favorable to virtual property rights to host their businesses, and that designers will continue to abuse, through lobbying power, their monopoly on virtual worlds).
[183] See id. (reviewing foreign property regimes and concluding that more businesses will invest in virtual property ventures).
[184] See id. at 1085-1086 (describing MMORPG chattel-friendly property law regimes in China as “an integral part of the Chinese government’s initiative to build a competitive virtual world industry” in which businesses would thrive).
[185] Id.
[186] See, e.g., Step Saver Data Sys., Inc. v. Wyse Tech., 939 F.2d 91 (3d Cir. 1991) (finding unenforceable standard-form, box top license that did not require assent).
[187] See Robert F. Hillman & Jeffrey J. Rachlinski, Standard-Form Contracting in the Electronic Age, 77 N.Y.U. L. Rev. 429, 431 (2002) (defining clickwrap agreements); see also Robert L. Oakley, Fairness in Electronic Contracting: Minimum Standards for Non-Negotiated Contracts, 42 Hous. L. Rev. 1041, 1051 (2005) (“[C]lickwrap licenses are an improvement over shrinkwrap agreements, because they do at least require some affirmative action to indicate assent”).
[188] See Oakley, supra note 187, at 1052-53 (describing browsewrap contracts).
[189] “Shrinkwrap” interchangeably references either “browsewrap” or “clickwrap” agreements. Id. at 1050.
[190] ProCD, Inc. v. Zeidenberg, 86 F.3d 1447 (7th Cir. 1996).
[191] See i.Lan. Sys., Inc. v. Netscout Serv. Level Corp., 183 F. Supp. 2d 328 (D. Mass 2002) (finding clickwraps enforceable under Massachusetts law); In re RealNetworks, Inc., Privacy Litigation, 2000 WL 631341 (N.D. Ill. May 8, 2000) (finding browsewrap license enforceable).
[192] ProCD, 86 F.3d at 1449.
[193] Id.; see Oakley, supra note 187, at 1050 (describing shrinkwrap contracts); id. at 1059 (suggesting that ProCD contract might constitute a browsewrap or clickwrap license because it appears each time user runs software). Because commercial users valued the database more than customers who intended the product for commercial use, ProCD declared on the outside of the box sold to non-commercial users that the software subjected the purchaser to restrictions included in the packaging. ProCD, 86 F.3d at 1449. Those restrictions prohibited commercial use of the CD-ROM by non-commercial users. Id. at 1450. Defendant Zeidenberg purchased a consumer version of the product, ignored the license, and created a company that re-sold the information in the database. Id. Zeidenberg breached the contract but argued that the court should find it unconscionable. Id.
[194] ProCD, 86 F.3d at 1452.
[195] Id. at 1452; U.C.C. § 2-204(1).
[196] U.C.C. § 2-606(1)(b); see U.C.C. § 2-602(1) (“Rejection of goods must be within a reasonable time after their delivery or tender. It is ineffective unless the buyer seasonably notifies the seller”).
[197] ProCD, 86 F.3d at 1453.
[198] See id. at 1449 (“Shrinkwrap licenses are enforceable unless their terms are objectionable on grounds applicable to contracts in general”).
[199] See, e.g., Hill v. Gateway 2000, Inc., 105 F.3d 1147, 1150-51 (7th Cir. 1997) (enforcing arbitration clause in contract terms included inside shipping box); In Re RealNetworks, Inc., Privacy Litigation, No. 00 C 1366, at *1 (N.D. Ill. 2000) (applying ProCD to browsewrap license); cf. Specht v. Netscape Commc’ns Corp., 306 F.3d 17, 22 (2d Cir. 2002) (implying that browsewrap license arbitration clause applies to programs mentioned in contract, but not to other programs included in installation). But see Klocek v. Gateway, Inc., 104 F. Supp. 2d 1332, 1341 (D. Kan. 2000) (finding that purchaser did not accept standard agreement located inside computer packaging).
[200] A contract that excludes a manifestation of consent is uncommon. See U.C.C. § 2-204(1) (“A contract for sale of goods may be made in any manner sufficient to show agreement, including conduct by both parties which recognizes the existence of such a contract”). Courts have reversed where one party sued to enforce a contract that did not mention the specific program subject to the litigation. See Specht, 306 F.3d at 22.
[201] See generally Oakley, supra note 187, at 1050 (describing clickwrap licenses and comparing them to browsewrap licenses).
[202] See Oakley, supra note 187, at 1060 (“Clearly, opportunity to review the document before being bound, opportunity to return if the terms are unacceptable, and some manifestation of assent are now important parts of finding a valid agreement”).
[203] Id.
[204] See Jankowich, EULAw, supra note 32, at 15 (citing Sony’s Everquest as example).
[205] Designers less likely employ this type of repetition. See id. at 15-16 (finding, generally, deceptive trend in EULA presentation, and minimal opportunities for consumer review).
[206] See i.Lan Sys., Inc. v. NetScout Serv. Level Corp., 183 F. Supp. 2d 328, 338 (D. Mass. 2002) (enforcing clickwrap license where agreement appeared before software installation); Oakley, supra note 187, 1060 (emphasizing assent requirement). Whether or not courts would find these agreements unconscionable remained an open question after ProCD. Id.
[207] See ProCD v. Zeidenberg, 86 F.3d 1447, 1449 (7th Cir. 1996) (enforcing shrinkwrap agreement).
[208] Id.
[209] See supra note 184 (predicting future investments in MMORPGEs).
[210] ProCD, 86 F.3d at 1449 (7th Cir. 1996).
[211] See U.C.C. § 2-302(1) (“If the court as a matter of law finds the contract or any term of the contract to have been unconscionable at the time it as made, the court may refuse to enforce the contract, or it may enforce the remainder of the contract without the unconscionable term, or it may so limit the application of any unconscionable term to avoid any unconscionable result”).
[212] See Nelson v. McGoldrick, 871 P.2d 177 (Wash. Ct. App. 1994); Oakley, supra note 187, at 1062 (implying that courts generally look for both types of unconscionability); Seungwoo Son, Can Black Dot (Shrinkwrap) Licenses Override Federal Reverse Engineering Rights?: The Relationship Between Copyright, Contract, and Antitrust Laws, 6 Tul. J. Tech. & Intell. Prop. 63, 121 (2004) (noting Professor Leff’s distinction that procedural unconscionability indicates “bargaining naughtiness,” while substantive unconscionability refers to “gross overall imbalance”). But cf. Brower v. Gateway 2000, Inc., 676 N.Y.S.2d 569, 574 (N.Y. App. Div. 1998) (stating that procedural unconscionability is not necessary); 7-29 Corbin on Contracts § 29.1 (stating that there is no requirement that court find both substantive and procedural unconscionability).
[213] Oakley, supra note 187, at 1063.
[214] See Jankowich, EULAw, supra note 32, at 12 (discussing MMORPG EULAs in terms of “complexity” and “accessibility”).
[215] See Ingle v. Circuit City Stores, Inc., 328 F.3d 1165, 1171 (9th Cir. 2005) (“A contract is oppressive if an inequality of bargaining power between the parties precludes the weaker party from enjoying a meaningful opportunity to negotiate and choose the terms of the contract”).
[216] 7-29 Corbin on Contracts § 29.1 (quoting NEC Techs., Inc. v. Nelson, 478 S.E.2d 769, 771-72 (Ga. 1996) (citations omitted)).
[217] E.g., Comb v. Paypal, Inc., 218 F. Supp. 2d 1165, 1172 (N.D. Cal. 2002); see Todd D. Rakoff, Contracts of Adhesion: An Essay in Reconstruction, 96 Harv. L. Rev. 1174, 1175-76 (1983) (suggesting that “more frequent use of the concept of unconscionability” might result in consistent treatment of contracts of adhesion); cf. Pollstar v. Gigmania, Ltd., 170 F. Supp. 2d 974, 981-82 (E.D. Cal. 2000) (looking to whether contract term is “buried in fine print” and “whether the user is given [an] ample opportunity to understand”). Much of the language that describes a contract of adhesion mimics the language that describes procedural unconscionability. See 1-1 Corbin on Contracts § 1.4 (noting that contracts of adhesion might contain “incomprehensible and intentionally obfuscating language,” implement “oppressive terms,” and have high potential for abuse by parties with superior bargaining power).
[218] See Oakley, supra note 187, at 1053; Arthur Lenhoff, Contracts of Adhesion and Freedom of Contracts: A Comparative Study in the Light of American and Foreign Law, 36 Tul. L. Rev. 481, 481-82 (1962) (reviewing elements of contracts of adhesion).
[219] Oakley, supra note 187, at 481-82.
[220] Id.
[221] See Vault v. Quaid Software, Ltd., 655 F. Supp. 750, 760 (E.D. La. 1987) (identifying an adhesive take-it-or-leave-it choice-of-law provision).
[222] See id. (noting that contracts of adhesion are “unilaterally drafted”).
[223] Id.
[224] Id.
[225] See Rakoff, Contracts of Adhesion, supra note 217, at 1175 (noting that “there is little agreement on what principles should control” contracts of adhesion); see also 1-1 Corbin on Contracts § 1.4 (reminding that “there are important advantages” to contracts of adhesion, including that “[t]he standardization of forms for contracts is a rational and economically efficient response to the rapidity of market transactions and the high cost of negotiations”).
[226] See, e.g., Brower v. Gateway 2000, 246 A.D.2d 246, 254 (finding that traveling costs necessary to comply with forum-selection clause unreasonably favor one party).
[227] Davidson & Assocs. v. Internet Gateway, 334 F. Supp. 1164, 1180 (E.D. Mo. 2004), aff’d Davidson Assocs. v. Jung, 422 F.3d 630 (8th Cir. 2005).
[228] See, e.g., id. (finding EULA and TOU not unconscionable where it did not impose “harsh or oppressive terms”).
[229] U.C.C. § 2-302 cmt. 1.
[230] Oakley, supra note 187, at 1063.
[231] Id. at 1062. But see, Ingle v. Circuit City Stores, Inc., 328 F.3d 1165, 1172-73 (finding procedural and substantive unconscionability where arbitration agreement included seven “one-sided” provisions).
[232] Davidson, 334 F. Supp. at 1180.
[233] See A & M Produce Co. v. FMC Corp., 135 Cal. Rptr. 114, 120 (1982) (describing unconscionability as “flexible doctrine designed to allow courts to directly consider numerous factors”), cited in 7-29 Corbin on Contracts § 29.1.
[234] See Jankowich, EULAw, supra note 32, at 15 (noting MMORPG gamers must review documents for changes because many virtual world proprietors reserve right to change contract terms without notice).
[235] See, e.g., Blizzard Entertainment, World of Warcraft Box (2004) (“The use of this product is subject to the terms in the End User License, which you must accept before you install this product”); ProCD v. Zeidenberg, 86 F.3d 1447, 1449 (7th Cir. 1996) (noting that purchaser could see license without opening box).
[236] Blizzard Entertainment, World of Warcraft Manual, supra note 45, at 1.
[237] The most recent World of Warcraft EULA is less than three months old. Blizzard, World of Warcraft EULA, June 1, 2006, http://www.worldofwarcraft.com/legal/eula.html [hereinafter Blizzard, EULA].
[238] Courts and scholars employ the term “shrinkwrap” often to describe both clickwrap and browsewrap licenses. ProCD v. Zeidenberg, 86 F.3d 1447, 1050 (7th Cir. 1996).
[239] See Specht v. Netscape Communs. Corp., 306 F.3d 17, 22 n.4 (2d Cir. 2002) (defining clickwrap agreements).
[240] Id.
[241] See Tarra Zynda, Note, Ticketmaster Corp. v. Tickets.com, Inc.: Preserving Minimum Requirements of Contract on the Internet, 19 Berkeley Tech. L.J. 495, 507-08 (2004) (adding that browsewrap licenses are suspect because they do not require user to view contract, and sometimes avoid assent requirements).
[242] See id. at 507 (noting that “the U.C.C. and case law generally support the enforceability” of clickwrap licenses).
[243] Id. at 507-08.
[244] See Tal Z. Zarsky, Information Privacy in Virtual Worlds: Identifying Unique Concerns Beyond the Online and Offline Worlds, 49 N.Y.L. Sch. L. Rev. 231, 265 (observing that most users don’t read provisions “cloaked in heavy legalese”). Most users do not read the contracts at all. Id.
[245] See id. (adding that gamers typically do not have attention to read each provision of EULA).
[246] The first section of the World of Warcraft EULA contract specifies that “[t]he Game may only be played by obtaining from Blizzard access to the World of Warcraft massively multi-player on-line role-playing game service[,] . . . which is subject to a separate Terms of Use agreement.” Blizzard, EULA, supra note 237; see Jankowich, EULAw, supra note 32, at 17-18 (discussing nine documents that EVE Online players presumptively understand via participation).
[247] See Vault v. Quaid Software, Ltd., 655 F. Supp. 750, 760 (E.D. La. 1987).
[248] See Oakley, supra note 187, at 1052-53 (finding that while clickwrap agreements allow opportunity for consumer affirmatively to click “I agree,” that option does not mitigate fact that consumer had no part in drafting contract).
[249] See Jankowich, Property and Democracy, supra note 16, at 177 (“[A]nything left out of the Lessigian code/law would fall into the catch-all restrictions of the end user license agreement”).
[250] The terms of the World of Warcraft TOU prohibit, inter alia, anything that is contrary to the “essence” of World of Warcraft, “carry[ing] out any action with a disruptive effect,” owning more than one account, and choosing an avatar name that is “related to drugs, sex, alcohol, or criminal activity” or “[b]elonging to any religious figure or deity.” Blizzard, TOU, supra note 32, at 1, 3(A)(6)-(8), 3(B)(ii), 3(C)(v). Most MMORPG EULA, TOU, and TOS agreements contain similar provisions. See, e.g., Linden Lab, TOS, supra note 62, at 2.3 (requiring character name that is “not misleading, offensive, or infringing”); Linden Lab, Community Standards, http://secondlife.com/corporate/cs.php (threatening suspension or expulsion from Second Life for “intolerance,” “harassment,” “assault,” “disclosure,” “indecency,” and “disturbing the peace”). Blizzard bundles the clause prohibiting RMT within these provisions. Id. at (8). Note that Blizzard either owns, or has exclusively licensed, all of the content that appears in World of Warcraft. Therefore, no one has the right to "sell" Blizzard's content, except Blizzard. So Blizzard does not recognize any property claims outside of World of Warcraft or the purported sale, gift or trade in the "real world" of anything related to World of Warcraft. Accordingly, you may not sell items for "real" money or exchange items outside of World of Warcraft. Id.
[251] See Fairfield, supra note 16, at 1083 (noting that designers “parlay their (legitimate) claim to the intellectual property in an environment into an illegitimate claim to all of the virtual property possessed by or developed by the inhabitants of the environment”).
[252] See supra notes 180–84 (discussing individual and business incentives to invest in virtual worlds).
[253] See Raymond T. Nimmer, Breaking Barriers: The Relation Between Contract and Intellectual Property Law, 13 Berkeley Tech. L.J. 827, 848 (“A contract of adhesion analysis typically indicates that a court enforces the contract, but scrutinizes its terms more closely for terms that are procedurally or substantively unconscionable”).
[254] Linden Lab, What is Second Life?, http://secondlife.com/whatis/ (last visited August 11, 2006).
[255] See infra note 263 (discussing online auction site that Sony opened to mitigate RMT activity in Everquest).
[256] Linden Lab, IP Rights, supra note 62.
[257] Linden Lab, What is Second Life?, supra note 254.
[258] See Linden Lab, TOS, supra note 62, at 1.5 (explaining a service called “LindeX” that allows players to exchange virtual currency for real money).
[259] See Linden Lab, Land: Islands, http://secondlife.com/community/land-islands.php (last visited July 30, 2006) (detailing island size, topology, and price).
[260] See Yuki Noguchi, Yahoo, Wal-Mart Build a Virtual Catwalk; Contest Puts the Retailer’s Fashions on Users’ Avatars, Wash. Post, August 10, 2006, at D05 (explaining that MTV sponsored avatar fashion show and ESPN.com users can use avatars to give sports commentary that is featured on ESPN.com home page).
[261] Linden Lab employs this mechanism in its TOS agreement. Compare Linden Lab, TOS, supra note 62, at 3.2 (granting intellectual property rights in virtual property), with id. at 3.3 (retaining ownership in “account and related data”), and id. at 5.2 (reserving right to delete accounts without liability).
[262] Greg Sandoval, Sony to Ban Sale of Online Characters From Its Popular Gaming Sites, CNET News.com, Apr. 10, 2000, http://news.com.com/2100-1017-239052.html?legacy=cnet (last visited Aug. 10, 2006).
[263] See Sony Entertainment, Station Exchange: The Official Secure Marketplace for EverQuest II Players, http://stationexchange.station.sony.com (last visited Aug. 11, 2006) (opening designer-sanctioned online auction).
[264] See Renato Marrotti, Cyberspace in Three Dimensions, 55 Syracuse L. Rev. 251, 290-91 (2005) (“Very powerful characters have sold for up to $ 3,000”).
[265] See id. (remarking that Ultima Online designers consider this process to convert into real wealth passion that gamers manifest for game).
[266] See Jessica Ramirez, The New Ad Game; Advanced technology is finally allowing advertisers to get inside videogames like never before. Welcome to the new frontier., Newsweek, July 31, 2006, at 42 (“There are at least 132 million gamers 13 years and older in the United States alone”).
[267] See, e.g., IGE, About Us, supra note 30 (selling virtual currency and assets for real money).
[268] Tal S. Zarsky, Information Privacy in Virtual Worlds: Identifying Unique Concerns Beyond the Online and Offline Worlds, 49 N.Y.L. Sch. L. Rev. 231, 261 n.105.
[269] See Fairfield, supra note 16, at 1062 (“The projected U.S. revenue from sales of virtual objects in real-world currency is approximately $ 100 million dollars, and over $ 1.5 billion worth of transactions occurs yearly through in-environment trades”).
[270] Courts should more regularly implement the unconscionability doctrine. See Ryan J. Casamiquela, Contractual Assent and Enforceability in Cyberspace, 17 Berkeley Tech. L.J. 475, 488-89 (explicating how courts produce obscure, unfair results by readily enforcing online licenses (citing M. A. Mortenson Co. v. Timberline Software Corp., 998 P.2d 305, 315 (Wash. 2000) (enforcing remedies limitation that parties did not discuss, costing plaintiff $2,000,000))).
[271] Id.
[272] E.g., Linden Lab, TOS, supra note 62, at 2.6.
[273] Intel Corp. v. Hamidi, 71 P.3d 296 (Cal. 2003).
[274] See eBay v. Bidder’s Edge, 100 F. Supp. 2d 1058, 1071 (N.D. Cal. 2000) (turning to Restatement to determine harm required to sustain trespass to chattels cause of action applied to computer database); cf. John D. Saba, Jr., Comment, Internet Property Rights: E-Trespass, 33 St. Mary’s L. J. 367, 372 (identifying how courts applied trespass to chattels to computer data because modern trespass doctrine does not require strict physicality).
[275] Restatement (Second) of Torts § 217 (1965). “Intermeddling” means intentionally bringing about physical contact with the chattel. Id. § 217 cmt. e.
[276] Restatement (Second) of Torts § 218.
[277] The Restatement cites a toothbrush or an intimate garment as something that a possessor may find “reasonably destroy[s]” the chattel’s value. Id. § 218; see Caffarelli, supra note 104, at ¶ 44 n. 155 (concluding that Restatement provisions provide for actionable trespasses even absent physical harm and applying that concept to web sites). But see Intel v. Hamidi, 71 P.3d 296 (Cal. 2003) (declining to find actionable trespass to chattels where employee used e-mail server without consent to send thousands of e-mails).
[278] eBay v. Bidder’s Edge, 100 F. Supp. 2d 1058 (N.D. Cal. 2000).
[279] Id. at 1061-62.
[280] See id. at 1069 (finding likelihood of success that eBay could prove electronic signals sufficiently met Restatement’s tangibility requirements).
[281] See id. at 1070-71 (reasoning that eBay warns all automated visitors to its website that it does not permit such access, rejecting argument that eBay’s publicly accessible sites grant access permission to automated users, and finding that web crawlers exceed scope of consent that eBay granted).
[282] Id. at 1071; Restatement (Second) of Torts § 218.
[283] Intel Corp. v. Hamidi, 71 P.3d 296 (S. Ct. Cal. 2003).
[284] See id. at 300 (applying again Restatement provisions to computer data chattels).
[285] Id. at 299-300. Although the majority found no valid cause of action, Justice Mosk entered a vehement dissent in which he analogized Hamidi’s e-mails to hundred of mail carriers running down the hallways of the Intel offices. Id. at 309 (Mosk, J., dissenting).
[286] See supra Part II (applying Lockean, personhood, and Benthamist property theories to MMORPG chattels secured).
[287] See Restatement (Second) of Torts §§ 217-18 (requiring, in addition to intent, that trespasser dispossess possessor for at least substantial period, or impair chattel’s condition, quality, or value).
[288] See Intel, 71 P.3d at 300 (failing to find actionable trespass where electronic communication did not interfere with possessor’s use or possession of personal property).
[289] See id. at 304 (declining to find injury in electronic signals that “assertedly cause injury only because of their contents”).
[290] Cf. Hotmail Corp. v. Van Money Pie, Inc., Nos. C98-20064 JW & C-98 JW PWT ENE, 1998 U.S. Dist. LEXIS 10729, at *19 (N.D. Cal. Apr. 16, 1998) (finding likelihood of success on trespass to chattels claim because spam e-mails sent to Hotmail customers “fill[ed] up Hotmail’s computer storage space” and prevented entirely e-mail delivery).
[291] See Intel, 71 P.3d at 301 (finding that “the claimed injury is located in the disruption or distraction caused to recipients of the contents of the e-mail messages”).
[292] See id. (characterizing objection to contents of messages as “entirely separate from” personal property disruption).
[293] See id. at 308 (finding no harm where Intel’s e-mail server worked as designed).
[294] Courts could interpret gamers’ trespass to chattels claims in terms of computer resources or electronic signals, potential success. See Thrifty-Tel, Inc. v. Bezenek, 54 Cal. Rptr. 2d 468, 471 (1996) (finding electronic signals caused by phone calls sufficiently tangible to support trespass claim). But almost all activity in MMORPGEs does not occur on computers owned by persons or entities engaged in RMT; it occurs on servers owned by the game designer. See Stephens, supra note 18, at 1517-18 (explicating only one object code copy exists on a server, and that client software merely allows a gamer to view the code on his or her computer). A World of Warcraft gamer can access his or her avatar from any computer that has the client software installed. Id. This objection proceeds that gamers would have to argue that designers damage or impair their own computer systems, and that courts would not accept such an anomalous argument. Cf. id. at 1521 (finding no copyright infringement based on designers’ right to make copies because, given server-client structure of MMORPGEs, RMT activity does not copy any code). This intuitive image of property as belonging inherently to the designer does not comport with a legally cognizable interest in virtual chattels secured in MMORPGEs. See supra Part II (applying Lockean, personhood, and utilitarian property theories to justify property interests in virtual chattels).
[295] Professors Lastowka & Hunter argue the opposite, but note that prosecutors likely would not pursue theft in virtual worlds where the game designer permits that activity. F. Gregory Lastowka & Dan Hunter, Virtual Crimes, 49 N.Y.L. Sch. L. Rev. 293, 311 (2004).
[296] See Balkin, Law And Liberty, supra note 13, at 65 (“The right to play The Gulag Online is the right to experience–and to be subjected to–what can happen in that place”); cf. Lastowka & Hunter, Virtual Crimes, supra note 295, at 303 (reasoning that prosecutors would not consider criminal liability for actions that occur entirely within virtual worlds).
[297] See Ultima Online Support: Harassment Policy and Reporting, http://support.uo.com/gm9.html (last visited Mar. 11, 2007) (identifying theft as “valid play style”).
[298] Players typically click on a monster’s corpse to retrieve any virtual assets contained on its body. Blizzard Entertainment, World of Warcraft Manual, supra note 45, at 24. If players group together, they sometimes develop individual mechanisms for determining which party member gets to take certain assets. Id. at 142. A “ninja looter” takes all the assets, sometimes very valuable assets, and typically earns public humiliation by the rest of his or her party. See Posting of Clearsky to WoW Forums, http://forums.worldofwarcraft.com/thread.html?topicId=1777872026&postId=17777231672&sid=1#0 (Sept. 22, 2007, 07:23:13 PM UTC) (noting that “honorable” guild will remove members who ninja-loot items in MMORPGEs).
[299] See supra note 298 and accompanying text.
[300] See Edward Castronova, The Right to Play, 49 N.Y.L. Sch. L. Rev. 185, 191 (noting that other countries choose to prosecute people who hack MMORPG accounts, and positing that most governments would prosecute entirely intraworld activity). But see Lastowka & Hunter, Virtual Crimes, supra note 295, at 303-04 (reasoning that treating virtual theft as actual theft would keep external regulations from impinging on virtual world development).
[301] See Castronova, The Right to Play, supra note 300, at 191-92 (noting that Allen Iverson’s basketball opponent cannot arrest him for stealing a basketball).
[302] See Balkin, Law And Liberty, supra note 13, at 79 (forecasting sardonically that if game designer went bankrupt, gamers could “petition the bankruptcy court to keep the game running, restructure the business, and/or sell it to another party so that player's virtual property interests are not destroyed”).
[303] Stealing an account password or hacking an account requires that an individual leave the virtual world and perform some action to cause deprivation.
[304] See Lastowka & Hunter, Virtual Crimes, supra note 295, at 308 (reminding that, unlike other computer games, virtual worlds do not rely exclusively on computer code and that designers implement important social rights, like stealing, that deserve attention).
[305] Some entirely intraworld activity, for example, does not seem fair. In the MMORPG Eve Online, for example, players can set up banks that let players store their virtual cash. See Bobbie Johnson, Should Virtual Criminals Have Their Real-Life Collars felt?, The Guardian (London), Aug. 31, 2006, at 3 (describing Eve Intergalactic Bank and explaining that one player created bank that offered interest because “ISK,” the virtual currency, depreciated quickly). In the MMORPG Eve Online, for example, players can set up banks that let players store their virtual cash. Id. One player set up such a bank, which held about 100,000,000,000 virtual currency units. Id. The player closed the bank and ran away with all the currency, valued at about $40,000. Id. The player did not break the rules of the game. Id. Entirely intraworld activity can cause real harm.
[306] See Lastowka & Hunter, Laws of Virtual Worlds, supra note 7, at 72 (“Courts will need to recognize that virtual worlds are jurisdictions separate from our own, with their own distinctive community norms, laws, and rights”).
[307] See Balkin, Law And Liberty, supra note 13, at 2045-46 (“Much of what goes on in virtual worlds should be protected against state interference by the First Amendment rights of freedom of expression and association”).
[308] Compare id. at 2090-91 (suggesting that legislatures adopt statutes of iteration, or statutes that offer legal frameworks that structure designer-gamer relations), with Jankowich, Property and Democracy, supra note 16, at 192 (“In effect, the prospect of legislation to regulate virtual worlds at this point presents an example of virtual nation-building in which virtual worlds will be shaped by the impressions of outsiders rather than the desires of inhabitants”).
[309] Lastowka & Hunter, Virtual Crimes, supra note 295, at 298 (employing, as an archetype of virtual crime, a “real-time and non-consensual” written description of a sexual assault).
[310] Jack M. Balkin, Virtual Liberty, supra note 41, at 66 (noting that both MMORPG designers and participants can act so as to offend each other, and that important legal issues will result from these disagreements).
[311] See Lastowka & Hunter, Virtual Crimes, supra note 295, at 62 (concluding MMORPG designers should not always have absolute authority over virtual worlds, but questioning what rights gamers should acquire in virtual worlds).
Citation
8 U.C. Davis Bus. L.J. 235 (2007)