Nintendo Company Ltd & Anor v Playables Ltd & Anor

Sections 296 and 296ZD of the Copyright Designs and Patents Act 1988 create distinct regimes for devices that circumvent technological protection. Under section 296ZD, liability is strict and a lawful use does not provide a defence where the statutory purpose or design requirement is satisfied. The provision concerns dealings in the United Kingdom and does not require circumvention to occur there. Section 296 requires proof that the defendant knew, or had reason to believe, that the means would be used to make infringing copies. That requirement is general and need not relate to a particular program or exclusively infringing use. Summary judgment is appropriate where the evidence establishes each statutory element and the defence has no realistic prospect of success.

Nintendo sought summary judgment against Playables Ltd and Wai Dat Chan concerning devices imported and sold for use with Nintendo DS consoles. The devices enabled unlawful copies of Nintendo games to bypass Nintendo’s copy-protection measures. The claim relied on sections 296ZD and 296 of the Copyright Designs and Patents Act 1988, together with ordinary copyright infringement. The defendants did not appear and were not represented, although a partial settlement left the claims formally unresolved. The court considered whether the statutory elements, territorial scope, copyright claims and Mr Chan’s personal liability had been established to the summary judgment standard.

Summary judgment was granted in Nintendo’s favour to the extent identified in the judgment.

1. Section 296ZD. The boot-up software, Nintendo Logo Data File, encryption and scrambling constituted effective technological measures applied to copyright works other than computer programs. The accused devices circumvented those measures and satisfied each alternative condition in section 296ZD(1)(b). The provision imposes strict liability. Lack of knowledge was therefore no defence, and the existence of possible lawful uses did not assist the defendants where the devices still circumvented the measures. Nintendo also had standing to sue.
2. Section 296. Technical devices had been applied to Nintendo’s computer programs, and the relevant elements of the accused devices had the sole intended purpose of facilitating unauthorised circumvention. The statutory knowledge requirement was satisfied by the evidence that piracy was a well-known principal use of such devices and by the scale of the defendants’ dealings. Summary judgment was refused, however, in relation to export sales under section 296 because the anticipated infringing copies would be made abroad.
3. Territorial scope of section 296ZD. The court declined to follow Sony v Ball on this point. Section 296ZD focuses on United Kingdom dealings in devices capable of circumvention and does not require the circumvention itself to occur in the United Kingdom. Summary judgment therefore extended to export sales under section 296ZD.
4. Ordinary copyright. Copyright subsisted in the boot-up source code and Nintendo Logo Data File. Summary judgment was refused for the rudimentary racetrack logo and for the copying of boot-up software into RAM, but granted for unauthorised copying of the Nintendo Logo Data File into RAM. The devices were materially more than the equipment considered in CBS v Amstrad and were templates for infringement.
5. Personal liability. Mr Chan’s control of Playables, the corporate policy governing its activities and the delivery arrangements were sufficient to establish joint tortfeasor liability to the summary judgment standard.