Gaming Showdown: Pokémon vs. Palworld - EU General Court Upholds Protection of the LEGO Brick's Design

Gaming Showdown: Pokémon vs. Palworld

In the fast-paced world of gaming, an intense legal battle is brewing between Nintendo and the independent game developer Pocket Pair. The latter released “Palworld”, an open-world multiplayer adventure in January of this year, and has recently been accused of plagiarising character designs amongst other game features from the very famous “Pokemon” game series, by Nintendo who owns “Pokemon”.

Palworld has become a sensation, selling over 8 million copies since its release on 19 January. With over 1.5 million concurrent players, the game introduces an immersive experience where players use weapons to capture and train cute creatures known as "pals". The game has attracted attention for its approach to allowing players to capture adorable creatures and use them in combat.

On 25 January, when Pokémon Co (owned in part by Nintendo) announced an investigation into the matter. While Nintendo remains tight-lipped on the matter, the gaming community is left wondering about the potential repercussions for Palworld's developers.

The controversy grew with the emergence of a Pokémon “mods” made available in the Palworld game as revealed in a video made available on YouTube and X. A "mod" is a modification made by the gaming community that adds or changes content in the original game. In the case of Palworld, the mod included Pokémon characters and elements, offering players new interactions such as hunting and fighting within the game.

This move triggered a swift DMCA takedown by Nintendo, a US legal mechanism used by copyright holders to request the removal of infringing content from websites and social media such as videos of these Pokemon “mods” within the Palworld game. The original video shared on X was quickly taken down, but it showed Pokémon's main characters Ash, Brock and Misty, as well as some Pokémon in poor circumstances such as Pikachu and Torchic.

But the story doesn't end there. Recent comparisons on social media platforms suggest that Palworld's in-game models bear a striking resemblance to Pokémon assets. Senior game artists speculate on possible evidence of design inspiration, while acknowledging the possibility of manipulated models. While inspiration is in principle allowed, going beyond this and copying in-game designs from another game can constitute IP infringement. There are undoubtedly ressemblances between the two games, as demonstrates the unofficial name given by its fans to the Palworld game: "Pokémon with guns". Despite this, Pocketpair remains confident that the game will not face any legal repercussions or copyright infringement claims from Nintendo. It remains to be seen whether they are correct.

EU General Court Upholds Legitimacy of Lego Brick's Design

In a recent ruling of 24 January 2024 (T-537/22), the Court of Justice of the European Union (CJEU) deals with a key dispute concerning the validity of a registered Community design representing a toy brick. At the heart of the case is an assessment of whether the iconic LEGO brick design fulfils the requirements for protection as a design: designs only protect the aesthetic appearance of a product, but cannot protect any aspect of the product which actually serves a purpose (other than being aesthetically pleasing).

In 2010, LEGO A/S, the well-known Danish company, registered RCD No. 001664368-006 for its design "Building Blocks from a Toy Building Set", which relates to a Lego building block designed to be assembled with other blocks to build various objects or structures. Its defining characteristics include a row of studs on the top face, circles on the bottom face, a rectangular shape, wall thickness and cylindrical studs.

The German company Delta Sport Handelskontor GmbH however sought to have this design declared invalid on the grounds that all its features were exclusively dictated by the technical function of the product, in accordance with Article 8(1) of Regulation No 6/2002.

The EUIPO’s Board of Appeal dismissed the appeal on 30 May 2022 (R-1524/2021-3) for lack of substantiation. While recognising that all features were dictated by technical function, it argued that the design was protected under the modular system exception included in Article 8 of the EU Design Regulation. While Article 8(1) and 8(2) exclude designs based solely on technical functions or necessary for the object in which it is incorporated to perform its function. the key exception is Article 8(3), which allows protection where the design facilitates the assembly of products in a modular system, provided that it meets the usual design requirements of novelty and individuality.

Delta appealed to the General Court, which highlighted the following key issues.

First, as regards the exclusion of features having a technical function under Article 8(1) and (2), the General Court clarified that for a design to be declared invalid as a whole, all of its claimed features must be excluded as having a technical function. Upholding the Board's decision, the Court emphasised that at least one protected feature remains valid since its function was exclusively aesthetic: the smooth surface of the birks. Therefore, the design as a whole would not be considered invalid.

In relation to Delta’s concerts about errors in the application of Article 8(3): even if a design can fall within the “modular exception”, the design still needs to satisfy the basic registration requirements for designs: that of novelty and individual character. The GC emphasised that the burden of proof that these conditions are met lies with the party challenging the design. Indeed, designs are registered because they are presumed to satisfy these requirements, and it is up to other parties to demonstrate that it is not the case. As Delta had failed to prove that the design was not new at the time of filing, the Court upheld the Board of Appeal's conclusion not to assess the novelty and individual character of the contested design.

Lastly, the Court considered the alleged infringement of Article 63(1), which states that in proceedings before the Office, an examiner must examine facts of its own motion, meaning that it should take into account elements even if they have not been brought forward by parties to a proceeding. However, this does not apply in cases of declarations of invalidity, where the examination is limited to the information provided by the parties, including facts, evidence and arguments, as well as the nature of the relief sought. In this case, Delta argued that the Board of Appeal overlooked well-known facts and information when assessing the disclosure of prior designs. The GC clarified that the disclosure of a prior design does not automatically constitute a fact under Article 63(1). The EUIPO has to make a factual assessment of all the evidence submitted to determine whether it proves disclosure of the earlier design. The Court underlined that disclosure cannot be considered as a well-known fact exempting from proof, even if products with that design have been on the market for a long time and are generally known to the public.