Video games and Intellectual Property in Costa Rica

Laura Hernández Chaverri

Laura Hernández Chaverri

The Costa Rican legal framework, in conjunction with copyright law, places video games in a category analogous to computer programs or cinematographic works. However, neither of these classifications is suitable for comprehensively covering and safeguarding the elements that make them stand out as a complete creation in themselves without the need to fragment the work and, consequently, the author’s economic and moral rights.

It is essential to emphasize that, although the subject of this study encompasses the video game development industry at a national level, it is a global market projected to reach US$400.00 billion annually by 2027. According to the latest report from ICOMM, the European firm specializing in the analysis of the video game industry, in its Global Games Market Report, 2022, the industry registers worldwide revenues of over US$103.5 billion per year, with US$4.5 billion corresponding to purchases generated by individuals in Latin America.

Regarding the countries in the Central American region, Costa Rica leads the list as the country that invests the most money in this industry. It is worth mentioning that, according to a report by the British Broadcasting Corporation, the consumption of these products in 2017 reached figures worth US$30 million, and by 2022, there was significant growth that reached US$42.9 million in revenue for the video game industry. In this case, the supplied data demonstrate, on the one hand, the quality of the work performed by video game developers and producers in Costa Rica, and on the other hand, it is evident that, in terms of investment, video games are an important activity for the entertainment of the Costa Rican population.

Currently, there are at least fifteen national companies formally dedicated to video game development, and many of them, such as Headless Chicken Games, Fair Play Labs, Green Lava Studios, Tayassu Games, Tree Interactive, and Frame 3 Studio, export their products to major companies that develop, produce, and sell in the United States and Canada. Given this reality, it is urgent for companies engaged in this economic activity to have effective and specialized protection, as they perform work that not only generates entertainment but also millions of dollars. Furthermore, this is a growing industry that has the opportunity to capitalize on the opportunities that arise.

The graph below illustrates global growth and its projection to 2027 in the video game industry, which is closely linked to technological development to create more and better works. In the following graph, we can observe that the projection given in 2022 was approximately €229.39 billion, and for 2027, this estimate increases to €401.32 billion.

Graph 1.

Evolution and global projection of the market value of the video game industry between 2022 and 2027 (data given in billions of euros).

According to the studies on which this information is based, the video game industry has undergone impressive technological development, as well as significant economic growth over the years. These factors lead to an increase in the number of people involved in this activity and, consequently, in the creation of these works. In this regard, The Legal Status of Videogames report indicates: “Depending on the size of the project and the companies involved in the development of the video game, if in the 1980s, to create a video game, the production company needed the work and talent of only a few people, modern works require the combined effort of dozens (sometimes hundreds) of artistic and technical employees before the video game reaches the stores.”

Considering the above, it is essential to individualize, although not exhaustively, those who should at least hold recognition of Moral Rights for the development of video games.

Now, copyright aims to encourage authors and creators by recognizing moral and economic rights, so it is considered appropriate to seek a normative basis for such works. This is essential to promote effective protection of the mentioned rights for all contributors to the work, as currently the Copyright and Related Rights Law (No. 6683), and consequently, the Regulation to the Copyright and Related Rights Law (No.24611), does not recognize them as authors or rights holders, as the video game is not categorized as a work.

On the other hand, regarding international legislation, there is a problem, as they attempt to make a distributive classification in which each author’s contributions would be divided, protected, and registered separately. However, it is important to consider a reform to individualize a category that encompasses the sum of all components and provides moral rights to co-authors and those involved in the creation and production of the video game, not in a fragmented way but as an integral work.

Considering the above, the video game industry does not only deserve special attention (regarding updated protection in the Costa Rican legal system) due to the economic income it generates nationally and internationally but also because of the recognition of moral and economic rights, over the integral work, is not incorporated or moderately protected as such. This deficiency is reflected in the list of requirements for registering computer works and cinematographic works contemplated respectively in arts. 103 and 104 of Law No. 6683.

The Costa Rican legal system regarding copyright is currently insufficient to face and protect many of the challenges posed by technological development and evolution, especially in recent times when a new industrial revolution (what is called the 4.0 revolution) has once again transformed the information and knowledge society we live in. Therefore, it is not surprising that the video game creation industry—one of the most successful and lucrative in recent times in the entertainment sector—receives legal protection under an increasingly inadequate analogy due to the way the law is drafted. This implies that, in Costa Rica, the legal protection of the work, of the people developing video games, is deficient.

The Copyright Law classifies video games by analogy between cinematographic works and computer programs; in this case, the recognition and rights inherent to the authorship of this work are left adrift for many contributors and authors who make the work possible as a whole. Therefore, the designation of a specific category for video games, in which all its essential elements are recognized for the first time, along with their respective authors as part of an integral work, ensuring the moral recognition of each of them, is crucial.

If not, it is anticipated that the spirit and essential purpose of copyright to recognize authorship, through the right to paternity over the work and the possibility of economic gain, will be undermined as an incentive for greater and better innovation in various sectors, resulting in a detriment to the profit and employment generated by the video game development industry for creators.

It is necessary to start with two normative references that influence Costa Rican regulations regarding Copyright. The Political Constitution of Costa Rica specifies that “every author, inventor, producer, or merchant will temporarily enjoy the exclusive property of their work, invention, trademark, or trade name, under the law” (art. 47). In the same line of thought, there are two international norms that Costa Rica has ratified through Law 7475 and Law No. 6083 respectively:

    • The Agreement on Trade-Related Aspects of Intellectual Property Rights.
    • The Berne Convention for the Protection of Literary and Artistic Works ─which establishes in 2, paragraph 1, that protected works of a literary or artistic nature will be protected and recognized. However, in the list established in this latter instrument, only the video game could be introduced as a work analogous only to the cinematographic or software ─at the discretion of each country adhering to the Convention.

which video games fluctuate. Nevertheless, WIPO, in a publication called Video Games, mentions that these:

“… are indeed complex works of authorship that may be composed of several works protected by copyright, (namely:) (…) contain at least two main parts: audiovisual elements such as images, video recordings, and sounds and software, which technically manages the audiovisual elements and allows users to interact with various elements of the game.”

This is why some countries consider that video games can be classified as software due to their predominance in support or, conversely, be recognized as a synergy and sum of defined works. This has led some legal systems to decide to recognize them as complex work with the aggravating factor that, as there is no worldwide consensus on how to protect a video game under a specific category within copyright law, they choose to protect all elements as separate works and not as part of a unit.

Currently, the Costa Rican legal system does not contemplate video games as a work with its own category within copyright law but considers them analogous to cinematographic works or computer programs. Note that the Copyright and Related Rights Law (No. 6683) in arts. 4, subsections ñ and q, 55, and 56, define only some aspects, such as:

    • Computer program: a set of instructions expressed by words, codes, graphics, design, or in any other form that, when incorporated into an automated reading device, is capable of causing a computer – an electronic device or similar capable of processing information – to perform a certain task or obtain a specific result. (…). ( 4, subsection ñ)
    • Cinematographic work: an audiovisual work, such as that incorporated in a videogram, consisting of a series of images which, when shown successively, give an impression of motion, accompanied by sounds if any ( 4, subsection q).

Unless otherwise agreed, the film producer is vested with the full and exclusive exercise of the economic rights over the cinematographic work. They may carry out all acts aimed at its broad circulation and exploitation, as expressed in contracts with their co-authors.

Also protected as cinematographic works are those audiovisual programs produced by a process analogous to cinematography, such as videograms (art. 55).

The moral right over the cinematographic work belongs to its director, who can only oppose the circulation and exhibition of the film by a final judicial decision (art. 56).

Despite the incorporation and combination of elements of a computer program and a cinematographic work in a video game, neither of these two categories is sufficient. Firstly, there is a concrete fact: an interactive entertainment element that is crucial between the user and the program, without which the objective of the work cannot be achieved. Secondly, the law seeks analogous protection using as a basis the elements and characteristics of video games from the 1960s and 1970s, a time when not only was Law 6683 established but also when only a fraction of the components, collaborators, developers, and innovation that permeate video games today were envisioned, even if they do not necessarily come from AAA studios.

In this regard, it is noteworthy that, according to Lipson and Brian, the components of a video game are essentially classified into three groups: audio elements, video elements, and computer code. These elements will be analyzed in more detail later.

Lipson and Brian’s approach shows that none of these components is contemplated in the proposed categories of Costa Rican legislation.

It is assumed that it would be a special type of collaborative work because, in practice, this facilitates the production company owning the economic rights to its work to decide how, when, and to whom to grant these rights or license them. So, for this specific case, the intention is for the authors to be recognized for their moral rights and have the possibility to claim them both in the credits of the video game and in the future to use them as a reference in their curriculum vitae, promoting and opening up greater labor and economic incentives by having this moral credit that protects them in the present and future.

Certainly, cutting-edge technology and informatics not only continue to advance and develop rapidly but also encompass a myriad of fields, such as wireless network technology, new ways of interacting with others (such as the metaverse), and, of course, technology applied to video games, which increasingly incorporate elements not covered by Costa Rican Copyright Law dating back to 1982.

Other elements that can be protected by copyright include:

    1. Video game script.
    2. Plot or story.
    3. Well-developed characters.
    4. Choreography and pantomime.
    5. Maps and architectural works.

Expert D. Ramírez points out that the components of a video game mentioned by Lipson and Brian and Ramos et al., established over 10 years ago, are outdated and should include, among others:

    1. Gameplay
    2. User interface.
    3. Artificial intelligence.
    4. Shaders.
    5. Rendering.
    6. Physics.
    7. Storage and progress.
    8. Graphics, including three-dimensional models, animations, textures, and visual effects.
    9. Cameras (including active and scene cameras).
    10. Audio and sound, including sound effects, music, dialogues, atmosphere, story, and narrative.
    11. Connectivity, including servers, state synchronization, and security and encryption.

Now, even though professionals and authors who make the elements of video games possible usually have an employment relationship when creating their works—and economic and moral rights remain with the employer—they should also hold moral recognition for their contribution to the work. According to interviews conducted with professionals in video game development and an actress, their contribution is easily identifiable and, therefore, can be credited for moral recognition.

From the perspective of professionals in the video game creation industry, rights are rarely protected, as when rights are assigned or when a video game work is wholly or partially exported to another company, the moral recognition of the company that created that part of the work is not acknowledged. Individuals who made it possible are also not recognized.

Starting with the distinction made by art. 4 of the law regarding the difference between a computer program and a cinematographic work, it is important to pay attention to the spirit of the law and the ultimate goal of both categories. Regarding the computer program, the law states that its primary purpose is to be a set of instructions executed by a computer to achieve a specific result. In contrast, a cinematographic work consists of a series of images that, when shown successively, create an impression of movement, accompanied by sounds if any (art. 4, letter q).

Note that none of the definitions presented in the lawfully encompasses the elements that make up the development of a video game. One of the most crucial elements of a video game goes beyond the simple execution of tasks—it aims to provide entertainment through interaction between the player and the game. This demonstrates that these two categories lack the adequate tools to properly protect the work and, consequently, its authors.

In this scenario, in a labor and contractual context, the lack of a specific category could have repercussions. For example, if developers are not properly recognized as the authors of various elements of the work, they cannot include these works as part of their professional portfolio. Additionally, in the Costa Rican context where 89% of video game creations are exported, companies like Sony, Xbox, Steam, EA, and others do not even mention the Costa Rican company in the credits that designed an area of the game, which should be protected by copyright. Companies then face a challenge in breaking into the market because they cannot use what they have designed for other video games as part of their presentation to be considered by other companies looking to hire their services. This complicates the possibility of being high-competitive agents in the market.

United States – Copyright

In this context, it is relevant to conduct a brief comparative study with the copyright legislation of the United States, not only because it has one of the world’s largest video game industries but also because it is Costa Rica’s major trading partner for this industry.

Note that in the United States law, video games are not explicitly mentioned or categorized in their copyright legislation either. However, it aligns with Costa Rican legislation in that they can be protected if they are original, fixed in an analog or digital medium, and therefore perceptible and reproducible. However, without a classification that protects video games as a particular work (and from a fragmented perspective), an effort must be made to determine whether it is better to consider them as computer programs (literary works) or as cinematographic works (for their visual art).

For these purposes, it is worth mentioning the case of AM General LLC (also known as AMG) against Activision Blizzard, Inc., and Activision Publishing Inc. In 2017, the renowned American manufacturer of heavy vehicles (both for military purposes such as the ‘HUMVEE’ and for commercial purposes, the HUMMER) sued the video game company Activision, claiming unauthorized use of the HUMVEE vehicle and its brand for the globally recognized Call of Duty game franchise, which has exceptional cinematographic quality to provide greater realism and interest to the player during interaction.

In this case, AMG believed that Activision was infringing on its trademark rights to the vehicle through the use of the brand name in game dialogues and strategy guides, as well as by representing the industrial design of the vehicle. AMG fundamentally argues that this unauthorized use creates a risk of association and confusion among the public, as well as harm to the image of the company’s brands.

Activision, on the other hand, claims that the representation of the HUMVEEs in the video game amounts to only a total of 3 minutes throughout the work and that the brands have not been shown or appeared in the advertising of the work. It also argues that this representation is protected by the Rogers v. Grimaldi case law (remember that in the United States, case law is binding), which establishes criteria for determining whether a work of art infringes on the trademark rights of a holder. Therefore, Activision considers that the use of the vehicle is only to reflect the reality of the U.S. military as an artistic representation.

In 2020, the U.S. court dismissed AMG’s lawsuit, determining that:

“…the use of the vehicle by Activision had only one purpose: the artistic one, as they sought, through that representation, to make the player’s interaction as real as possible in the context of the elite of the U.S. armed forces, and therefore there is no confusion for AMG’s consumer, as the purpose of the video game is to entertain and not to promote the sale of HUMVEE vehicles.”

Consequently, this ruling determines that, in the United States, despite not having a specific rule protecting a video game in its copyright legislation, these are considered creative work, and their copyright protection should be analyzed as a whole, considering the ultimate goal: the entertainment factor of these works.

This paradoxically demonstrates that, despite the United States being a country with one of the largest and most influential video game industries globally, it does not have adequate legislation to protect either the work or the author. This does not imply in any way that there is a reason preventing improvement to Costa Rica’s copyright legal framework; rather, it should serve as an example of the complications that the national video game industry may continue to face if the possibility of protecting these works solely through the analogy between a computer program and a cinematographic work persists, as stipulated in the current law.

Conclusions

In conclusion, the lack of a specific category for video games in the Costa Rican legal framework could lead to certain aspects of video game development, such as the recognition of the moral rights of creators, not being adequately considered or protected. This implies that it might be important to consider legal reforms to address the peculiarities of this form of artistic expression and ensure the protection of the rights of video game developers in Costa Rica.

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