City of Heroes Publisher Wins First Round Of Marvel Battle

A U.S. district court judge in Los Angeles has dismissed several key claims by comic book publisher Marvel Enterprises in the company's trademark and copyright infringement case against publisher NCsoft and developer Cryptic Studios. Marvel sued both companies in November of last year, claiming that the City of Heroes MMORPG allows players to imitate comic book characters owned by Marvel. The judge agreed with NCsoft that some of Marvel's allegations and exhibits should be stricken as "false and sham" because certain allegedly infringing works depicted in Marvel's pleadings were created not by users, but by Marvel itself. The judge also dismissed more than half of Marvel's claims, including that the defendants directly infringed Marvel's registered trademarks and are liable for purported infringement of Marvel's trademarks by City of Heroes' users. In addition, he dismissed Marvel's claim for a judicial declaration that defendants are not an online service provider under the Digital Millennium Copyright Act. The judge dismissed all of these claims without leave to amend, meaning that Marvel cannot re-file them. Although the judge allowed certain claims to survive the motion to dismiss, NCsoft and Cryptic Studios are reportedly pleased with the result. Citing a 1984 Supreme Court case holding that the sale of video cassette recorders did not violate copyright law, the Court noted that "It is uncontested that Defendants' game has a substantial non-infringing use. Generally the sale of products with substantial non-infringing uses does not evoke liability for contributory copyright infringement." Only "where a computer system operator is aware of specific infringing material on the computer system, and fails to remove it, the system operator contributes to infringement," the Court stated. The defendants have ten days in which to answer and dispute Marvel's allegations and to assert legal defenses to the remaining claims as well as to assert any counterclaims.