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Author Topic: NovaRO Lawyered Up!  (Read 7688 times)

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Offline RebirthOfficial

NovaRO Lawyered Up!
« on: Aug 18, 2022, 04:51 pm »
Disclaimer
So, Nova has lawyered up. I see a lot of people speculating on what will happen next. Before we get too far into this I want to open with the usual disclaimer, this is not legal advice and while I do go over some facts here most of this post is largely my opinion and interpretation of the facts. While I do have extensive knowledge of the law and am in contact with a lawyer, I am not a lawyer. If you are being sued or think you might be sued you should get a lawyer. Legally speaking, this post should be considered to be for entertainment purposes only (Basically: Don't sue me if this doesn't work out how I predicted). Now, onto the speculation...

Introduction
So, NovaRO has hired a lawyer and has gotten the default judgment set aside. First, the most likely outcome, at least in my opinion, is that Nova will settle the case. This is generally going to be the best option here as the evidence for some of the counts is fairly compelling. I'll go over each count below but it really doesn't matter much from Nova's perspective as any one of the counts can be fairly life-altering if proven in court. It's also very expensive to defend a federal case such as this, Nova is looking at spending at least US$50,000 if this goes to trial. I believe the outcome for the players of NovaRO has not changed, this has simply delayed the inevitable for the server. But, what about the rest of the community, which counts matter to us and which do not? Not all of the counts alleged against Nova can be applied to all private servers, in fact, most of them are unique to NovaRO or easily avoided. I'll go over each count alleged against NovaRO and cover how likely I think it is to stick and what a decision on it would mean for other servers.

Server Emulators
Before I get into each count I want to cover something very important. There is a lot of speculation on if running the server itself is a violation of copyright law. While the server software is not a direct target of the complaint filed by Gravity many people have been saying that because NovaRO runs on rAthena and since rAthena is open source and not something Gravity directly owns or had a hand in writing that the server is completely legal. This is, at best, unproven and at worse outright false. There is no direct precedent set to show that running a private server is legal. The closest we have are cases of emulation software being used to emulate hardware to play legally owned games. That doesn't really apply here for a number of reasons.

The first and probably most important reason is that it doesn't matter. If you buy a printer, having a printer is legal, printing money is not. The server software existing and being legal to do so does not automatically translate into running a server for the purpose of emulating an RO server being legal. BitTorrent is legal, downloading pirated content is not. mGBA is legal, downloading ROMs is not. That's not saying it isn't legal to run a private server, it could be, but it is unproven. We do not know if server emulation is legal because no case regarding it has gone to trial. All the cases so far (mostly filed by Blizzard, but quite a few by NCSOFT) have either defaulted or settled, and neither of those outcomes has set precedent for server emulation.

Also, though it is often cited as a reason for it being legal, the server software being open source does not matter at all, not even a little bit. I have absolutely no idea why people think something being open source automatically makes it legal, it has absolutely no bearing on the legality of server emulation in any way. There is no clause in copyright law that suddenly causes an exception because the source code is available. What being open source does do is make it hard to eliminate its existence. Because everyone has the source code taking down the project will just make others fork it and rise up in its place. It is a deterrent, not a shield.

Moreover, even if server emulation overall is legal, rAthena and Hercules, in particular, are likely not legal out of the box. They contain verbatim copies of story elements of official servers as well as monster names, etc. Those story elements are protected by copyright and some monster names (such as Poring) are protected by registered trademarks. The projects likely violate copyright and trademark laws for these reasons and any server running the software without removing those elements is likely violating copyright law as well. Put simply, this isn't a clear-cut case even just looking at the scope of server emulation.

COUNT 1: FEDERAL TRADEMARK INFRINGEMENT (15 U.S.C. § 1114)
This, I believe, is the reason for the lawsuit. It primarily centers around NovaRO's use of the trademark "Ragnarok Online". This is likely the absolute most important thing on Gravity's complaint from Gravity's perspective -- as I said, I believe it's the reason for all of this. Why? Trademarks are protecting the way you are using a certain word or phrase. For instance, Marvel/Disney owns a trademark on "Thor" for use in movies, comics, etc. If you made a movie called Thor you could be sued, but making a car called Thor would not violate that trademark because the scope is limited to how they registered it. You cannot blanketly register trademarks either, you must use them in commerce. If you stop using a trademark in commerce you will lose the trademark after some time. Also, and most importantly for this case, you must enforce your trademark. It is not optional. If you do not enforce your trademark you will lose it. Trademarks are generally considered "dead" after not being enforced for 15-20 years. Unless you are super new here you know Gravity hasn't enforced their trademark since they sent a cease and desist to YARE back in ~2003. Because many private servers have been using their trademark unenforced for the last 19 years they are in the gray area where their trademark may already be considered dead and they were about to cross the threshold where it almost certainly would have been. This lawsuit was basically necessary, they have to show efforts of enforcement or they would absolutely lose it at some point.

With that said, this is a coin toss. Gravity has not enforced its trademark for so long that it is hard to say if the court will kill the trademark or not. Obviously, if the court kills the trademark it could be considered a huge win for the community in general. If they lose the challenge or settle it could effectively reset the clock and refresh the trademark, though a single successful lawsuit with so many blatant violations may not be enough to completely reset that clock it will definitely get things to start leaning in their favor once again. Depending on the outcome of this case private servers would likely be wise to remove logos and terms trademarked by Gravity from their websites.

COUNT 2: COPYRIGHT INFRINGEMENT (17 U.S.C. § 501(a))
This is, in my opinion, the most difficult to defend count alleged by the complaint. The distribution of the entire game isn't really possible to defend. There are arguments to be made here to try to limit damages to a relatively insignificant number if successful but the allegation itself is almost certain to be proven true. Gravity also alleges the infringement was willful, which means that they are saying NovaRO infringed knowing that they were infringing and it was not an accident or mistake. This has two important ramifications, the first of which is it can increase the damages awarded to Gravity. The other I will discuss later on in this post.

Obviously, if the court finds NovaRO guilty on this count it makes the entire operation illegal and the server will have to close. Gravity would likely be awarded quite a bit of money as well. If NovaRO somehow wins here it could effectively make all private servers legal, though this is extremely unlikely at this point. The most likely (but still extremely unlikely) way Nova could win here is on some sort of technicality. The technicality (of which I see none) may not transfer over to other servers depending on what it is.

There is a statute of limitations on copyright infringement of 3 years from the date the copyright owner learned of the violation. There is some confusion surrounding this where some people think this means that any server older than 3 years effectively becomes a legal server, this is an incorrect interpretation of this statute. This statute exists to cover a specific situation. Say you copy a book someone wrote and sell 100 copies and 5 years later the author of the book finds out, this statute exists so that person can still sue. If the infringement is ongoing, as is the case here, then the clock does not start ticking down until the infringement stops. So, if Gravity knew your server existed and you closed it 3 or more years ago you could not be sued. That is what this statute does. It does not mean that getting ignored for 3 years gives you an automatic right to someone else's intellectual property. Copyright does not need to be enforced to remain valid, that is exclusive to trademark law.

Also, while Gravity cites making money here this does not impact the legality of the infringement. There is a common belief on the internet that if you aren't making money then it is legal. Did the people sharing music and movies on BitTorrent make money? No. Were they successfully sued? Yes. The reason Gravity alleges that NovaRO made money in the complaint is because it affects (increases) damages. This can significantly increase the amount they are awarded if they win. That's all making money does. If you don't make money you can still be successfully sued, the amount awarded to the one suing you is just likely to be lower.

There is no publicly available method to avoid this allegation. It is theoretically possible but not without risks and is quite a complicated process. Please note that while it is controversial to say so, fan art is derivative and is not exempted from copyright law. Using fan art on your website will not stop Gravity from using your website content against you. Your designs must be completely original and not reference Gravity's intellectual property at all to be legal. This is not up for debate, there is already a lot of precedent set. Fan art and fan fiction are derivative and you can be sued for them (this is one case where it is sometimes required that you profit from it though). The reason you don't see it very often is that it generates a lot of bad publicity. In the early days of the Internet, many companies successfully sued fan artists and fan fiction creators. They didn't stop until the media started roasting them for suing their own fans. This is similar to when Nintendo was DMCAing YouTube content creators for uploading playthrough content. Nintendo was legally within its right to do so and only stopped because public and media perceptions of its actions were negative.

COUNT 3: FALSE DESIGNATION OF ORIGIN & UNFAIR COMPETITION (U.S.C. § 1125(a))
Here Gravity is saying that NovaRO effectively impersonated them or tried to cause confusion and get people to think they were Gravity or somehow endorsed by Gravity. This allegation at first may appear to hinge on Nova being found guilty of at least one of the previous two but actually does not. For this to be found true Gravity only needs to prove that the majority of its allegations are true. Even if for some reason the court found the trademark dead and copyright unenforcible in this case Nova could still lose here if some of the previous allegations are found to be true. They would need to prove that Nova did indeed deceive or confuse players into thinking that they were endorsed/authorized by or were actually Gravity. Gravity has entered in a few forum posts as evidence that Nova intended to impersonate Gravity however I do not see that evidence as valid as it is simply not showing that. The use of Gravity's logos, however, could be said to cause confusion and is, in my opinion, the biggest (and only) thing that makes this plausible.

I do not expect this charge to stick. If it does stick it might be a good idea to add a disclaimer to any website even remotely related to RO/Gravity. Something like, "This website is not owned, operated, or endorsed by Gravity Co. Ltd. or any of its affiliates." would likely avoid this charge being levied against you. We will see.

COUNT 4: UNLAWFUL, UNFAIR, FRAUDULENT BUSINESS PRACTICES (CALIFORNIA BUSINESS & PROFESSIONS CODE § 17200 et seq.)
This is basically a repeat of count 3 but under California law.

PRAYER FOR RELIEF (What Gravity demands)
This one is pretty simple, they want money and an injunction. An injunction is a court order to do (or to stop doing) something. In this case, they effectively want an injunction to force NovaRO to close. Any one of the above counts being found in Gravity's favor is likely to cause the injunction to be granted. Ignoring an injunction is an extremely bad idea. You can be held in contempt of court and thrown in jail or fined daily until you comply. The authorities may also step in and force compliance, such as raiding a location to seize things or getting another injunction compelling (forcing) someone else to comply, such as forcing the server host to terminate service.

What happens to the owner of NovaRO?
This one has come up a few times. I've seen a few people ask what happens if the court finds NovaRO liable for hundreds of thousands if not millions of dollars. Well, it depends. Some people have speculated he could just declare bankruptcy and that is possible. However, you can only discharge a judgment of this nature if it is not willful or malicious. As I stated earlier on, Gravity is absolutely alleging that the acts were willful. Gravity has not alleged malice so it is possible that even if NovaRO is found guilty on all counts that the judgment could be discharged in bankruptcy, however, Gravity need not prove malice at this stage. If NovaRO filed for bankruptcy the judgment would be placed in question and Gravity's lawyer could try to prove malice at that point. If malice is proven then and willfulness was already proven during the lawsuit then the judgment will be blocked from being discharged.

Now, can Gravity actually collect any money they are awarded? If the owner of NovaRO owns any real estate or high-value items such as cars, boats, etc, Gravity could seize or obtain a lien on these items. In the case of seizure, they'd sell the items to recover money and in the case of a lien, they take money when the owner (NovaRO) sells them. So let's say Gravity put a $100,000 lien against a house and then the house was sold for $120,000, Gravity would get $100,000, and the owner that sold it would get the remaining $20,000. In addition, if NovaRO has any liquidity (cash) Gravity can seize that. If found guilty the court will order NovaRO to turn over a list of assets including bank account balances/statements so that they can begin to recover whatever they are awarded. They can also garnish his wages going forward until they are repaid.

Conclusion
I hope this clears up some things for anyone who was uncertain or confused/mistaken about the situation. I am paying for this information and knowledge and sharing it so you don't have to. The outcome of this case can affect all of us and as I've been a part of the community for almost 2 decades I feel as most of us do about it. As unfortunate as this is for many, especially the owner and players of NovaRO, this was honestly an inevitability. I knew that Gravity would almost certainly inevitably feel pressured to enforce their trademark or start panic suing if they were bleeding out money. I'm honestly surprised it took this long, I've been fairly vocal about my feelings on it since somewhere around 2010.
« Last Edit: Aug 18, 2022, 04:59 pm by RebirthOfficial »

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Offline Oathkeeper

Re: NovaRO Lawyered Up!
« Reply #1 on: Aug 18, 2022, 05:35 pm »
Thank you for this detailed report. I'm sure owners will still tread lightly as this battle goes on for a while longer.  Just curious though, and maybe I missed it, but who was the source for the info about lawyering up? I can't say I've really heard of lawyering after a default judgment.

Offline RebirthOfficial

Re: NovaRO Lawyered Up!
« Reply #2 on: Aug 18, 2022, 05:37 pm »
Just curious though, and maybe I missed it, but who was the source for the info about lawyering up? I can't say I've really heard of lawyering after a default judgment.
A stipulation to set aside the default judgment was filed by a lawyer yesterday.

Offline Oathkeeper

Re: NovaRO Lawyered Up!
« Reply #3 on: Aug 18, 2022, 06:12 pm »
I see. Thanks for the additional information.

Offline Xellie

Re: NovaRO Lawyered Up!
« Reply #4 on: Aug 18, 2022, 06:32 pm »
Thank you for keeping us all informed

Offline charlielovesu

Re: NovaRO Lawyered Up!
« Reply #5 on: Aug 19, 2022, 04:28 am »
some misinformation here. you say Gravity hasn't sent out C&D's for a long time, but that is simply not true. they have been sending them for years. TalonRO has confirmed they got them (and ignored them) and I know personally of other servers that served C&D's.

The difference was gravity didn't really push hard to follow up. but they have technically been sending them out.

Offline Ariasqt

Re: NovaRO Lawyered Up!
« Reply #6 on: Aug 19, 2022, 06:08 am »
Nerds in a basement stealing servers shouldn't pretend they are lawyers tbh

https://cdn.discordapp.com/attachments/751936286666915940/1010125382034411520/unknown.png

Your disclaimer is always "I'm not a lawyer" blabla but then you "suspect" and "speculate" things you literally aren't trained for. Just because Nova hired your old Dev Luxuri (which by the way, was s*** at his job anyway imo) you are giving a press run on every update from the pacer.

As to why the default was actually withdrawn:

Quote
1. Defendants was not given adequate notice of the lawsuit;
2. Based on this delay in learning about the pending lawsuit, Defendants have
only recently retained counsel;
3. Following this retention of counsel, the Parties, through their counsel, have
conferred and agree to set aside the Clerk’s entry of default and allow
Defendants to proceed with responding to the allegations against them
Source: pacer

Just let the server have its lawsuit; we all know how its gonna end.

Also uh go update the people I am fully in favor of that cause keeping them in the dark is a **** move. But stop trying to run your own agenda
« Last Edit: Aug 19, 2022, 06:47 am by Ariasqt »

Offline RebirthOfficial

Re: NovaRO Lawyered Up!
« Reply #7 on: Aug 19, 2022, 04:39 pm »
Also uh go update the people I am fully in favor of that cause keeping them in the dark is a **** move. But stop trying to run your own agenda

I like how your "evidence" of "running [my] own agenda" shows me actually stating 2 possibilities including the one you appear to agree with but you are still super bitter over the fact I commented. That's hilarious. Also, you going way off topic to try to personally insult me is evidence of your bias. I think you need to learn to relax about speculative Internet conversations, especially when those speculating have outright said it's speculation. It's not like I presented an opinion as a hard fact that was 100% true and going to happen, you know like you just did. The speculation was over why Gravity's lawyer signed off on the request without trying to fight it. They could have tried to prove those points wrong and instead let it go.

Offline Phanneh

Re: NovaRO Lawyered Up!
« Reply #8 on: Sep 11, 2022, 01:09 am »
Ignoring an injunction is an extremely bad idea.

Hilarious, understated, accurate.

I... really am not sure Nova was wise to actually step into the ring and lawyer up though; I'd have thought the best course of action would be to have servers in places where intellectual property law is not respected, and have every flesh-and-blood human connected with the project stay as far underground as reasonably practicable.

Still, if the Trademark ends up being killed off that'd be phenomenal; I wonder what will happen : O


I am paying for this information and knowledge and sharing it so you don't have to.

Thank you kindly!

Offline zero kuma

Re: NovaRO Lawyered Up!
« Reply #9 on: Sep 12, 2022, 02:11 am »
In conclusion, it looks like Novaro can beat Gravity on this one. Novaro should never be shaken. You can win.

Offline DoctaThrow

Re: NovaRO Lawyered Up!
« Reply #10 on: Sep 12, 2022, 01:24 pm »
In conclusion, it looks like Novaro can beat Gravity on this one. Novaro should never be shaken. You can win.

I am not sure how’d you come to that conclusion. NovaRO and company have valid reason to throw out the possibility of a default judgement for multiple reasons, Gravity wouldn’t have an issue with signing that away since they are confident they are going to win anyways. Logically speaking, if they think there’s a chance they’d lose the case on the long run, they would never surrender the default, not without a fight. Now that they are taken to the stand, on damage estimation the court can request for income statements of NovaRO through the years. If Gravity never sent out cease and desist orders it would be a slightly different case, but they have but private server owners are convinced if they all collectively ignore it, Gravity may look the other way.

On a player’s point of view, I could reason that there exists an amount of advertisement effect from private server that fuels the official server, and arguably keeping them afloat, but it is neither quantifiable, nor provable.

Offline Kisuka

Re: NovaRO Lawyered Up!
« Reply #11 on: Sep 13, 2022, 04:23 am »

Offline OrdLordDaddy

Re: NovaRO Lawyered Up!
« Reply #12 on: Sep 13, 2022, 04:32 am »
Best defence: Deny everything  /gg

Offline zero kuma

Re: NovaRO Lawyered Up!
« Reply #13 on: Sep 13, 2022, 05:33 am »
The advertising effect of Ragnarok through the personal free server is sure to continue.

The reason can be seen by looking at the number of users who enjoy Ragnarok on a personal server.

There are many cases where many people study characters on a personal server and then go to the Gravity Server.


1. In the past, there was a large server called Talon Server, and even though that server was closed, Gravity's profits did not increase at all. It is a case that proves that it does not affect the profit based on that reason.

2. Gravity must prove that you have been damaged by the personal server, but Gravity can never prove it. Because they're incompetent and the profits don't grow when the big servers are shut down.

If you submit based on this, you can win.
« Last Edit: Sep 13, 2022, 05:47 am by zero kuma »

Offline DoctaThrow

Re: NovaRO Lawyered Up!
« Reply #14 on: Sep 13, 2022, 10:10 am »
The advertising effect of Ragnarok through the personal free server is sure to continue.

The reason can be seen by looking at the number of users who enjoy Ragnarok on a personal server.

There are many cases where many people study characters on a personal server and then go to the Gravity Server.


1. In the past, there was a large server called Talon Server, and even though that server was closed, Gravity's profits did not increase at all. It is a case that proves that it does not affect the profit based on that reason.

2. Gravity must prove that you have been damaged by the personal server, but Gravity can never prove it. Because they're incompetent and the profits don't grow when the big servers are shut down.

If you submit based on this, you can win.

I’m basing this off logic alone.
1. They can easily point out that Talon RO players went to other private servers. Which is absolutely true. Meaning it is illegal copies of their game that hindered the official server’s growth.

2. Gravity can absolutely prove that they have been harmed financially by private servers like NovaRO, the question is how much. Damage compensations are separated into actual, statutory and income damages.

In my opinion, NovaRO only real chance in the whole ordeal is the technicalities regarding possible ambiguity or definition interpretation in regards to the properties of private servers, because any ambiguity will stand as the benefit of the private server itself.

But even in the extreme off chance that NovaRO wins, they will only be able to win the settlement, meaning as long as Gravity revise their terms of use to clearly categorize the use of their base game, NovaRO still closes, but they won’t have to fork out a payday for Gravity.

What I like to opine on as well is Ragnarok is in the 20th anniversary mark, they need to be able to convince investors/sponsors there’s no piracy issues, after the period of time private servers can likely come back. Also Gravity would not let this slide, this would set a very dangerous and problematic precedence. Logically, they’d rather use the lawsuit’s claim as a message to close off any potential lose ends from other servers.

Edit: I just scrolled up and read their rebuttal on the plaintiff’s claims, which is just denying allegations. It sounds like they are not denying that it is wrong to steal, but rather they didn’t know they were stealing, therefore they should not have to shoulder the consequences. Again that MAY get them out of the consequences (doubt it, it was quite blatantly done), but imo NovaRO itself wouldn’t survive the suit, just the owner.
« Last Edit: Sep 13, 2022, 11:29 am by DoctaThrow »