Assistant US Trade Representative For Intellectual

February 8, 2013
Mr. Stanford McCoy
Assistant U.S. Trade Representative
For Intellectual Property and Innovation
Office of the United States Trade Representative
600 17th Street, N.W.
Washington, D.C. 20508
Re: 2013 Special 301 Comments on Piracy of Nintendo Video Game Products
Dear Mr. McCoy:
Nintendo of America Inc. (Nintendo) submits this letter in response to the “Request for Written
Submissions From the Public” which appeared in the December 31, 2012 Federal Register. In
that notice, the Office of the United States Trade Representative (USTR) requested comments
pursuant to Section 182 of the Trade Act of 1974 (19 U.S.C. 2242), known as “Special 301,” on
“countries that deny adequate and effective protection of intellectual property rights or deny
fair and equitable market access to U.S. persons who rely on intellectual property protection.”
Nintendo has provided information to the International Intellectual Property Alliance (IIPA)
which is included in the filing of that organization. Nintendo is associated with the IIPA through
its membership in the Entertainment Software Association (ESA). This letter provides more
detailed information on piracy of Nintendo video game products, with an emphasis on Internet
piracy, along with Nintendo’s Special 301 placement recommendations.
Nintendo, along with its publishers and developers, is injured by the prevalence and ease of
illegal online distribution, as well as the continued manufacture, assembly, distribution, import,
export and sale of counterfeit Nintendo video game products across the globe. In the past few
years, the scope of online piracy for Nintendo has grown dramatically. Every month tens of
thousands of illegal Nintendo game files are detected on the Internet. The legal environment to
limit the flow of these files remains extremely challenging.
Theft of Nintendo’s video games illegally shared over the Internet impacts all who create,
develop, market and sell video games for the Wii U, Wii, Nintendo 3DS and the Nintendo DS
1
family of handheld systems. Surging Internet piracy continues to result in lost sales, lost jobs,
lost taxes for local, state and national governments, as well as the loss of incentives to create
and innovate.
Despite the operation of Nintendo’s anti-piracy programs in over 40 countries, worldwide
piracy of Nintendo video game products remains a chronic problem resulting in huge losses.
Special 301 has proven to be a highly effective tool in highlighting those countries that do not
provide adequate protection of copyrights and trademarks.
For 2013, Nintendo recommends that USTR designate: (1) Brazil remain on the Watch List; (2)
China for monitoring under Section 306 of the Trade Act and continued placement on the
Priority Watch List; (3) Mexico remain on the Watch List; and (4) Spain to be elevated to the
Watch List.
NINTENDO OF AMERICA INC.
Nintendo of America Inc., based in Redmond, Washington, serves as headquarters for
Nintendo’s operations in the Western Hemisphere and markets the highly successful line of
Nintendo video game products. Nintendo has branch offices in Redwood City, California and
New York, New York. Also located on Nintendo’s campus in Redmond is Nintendo Software
Technology Corporation which creates game software for Nintendo’s video game systems. In
1999, Retro Studios was founded in Austin, Texas as a sister-company to Nintendo of America
Inc. Retro is a development studio dedicated to creating products for Nintendo. Nintendo
holds the company’s intellectual property rights, including copyrights and trademarks, in the
Western Hemisphere. In addition, Nintendo coordinates the worldwide anti-piracy program on
behalf of its parent company, Nintendo Co. Ltd. of Kyoto, Japan.
Nintendo video game hardware platforms (i.e. Wii U, Wii, Nintendo DS, Nintendo DSi and
Nintendo 3DS) play Nintendo’s proprietary game software as well as proprietary game software
created by its third party licensees. Hundreds of U.S. companies independently create, license,
market and sell Nintendo video game products. Worldwide piracy of Nintendo products also
adversely affects the earnings and employment of these companies.
2
Table of Contents
Nintendo Video Game Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Internet Piracy and Circumvention Devices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Nintendo Infringing Hard Goods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Brazil . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Spain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
3
NINTENDO VIDEO GAME PRODUCTS
Console Name
Release Date
Units Sold To Date
Wii U
November 18,
2012
3.06million WW
Nintendo 3DS
March 27, 2011
29.84 million WW
Nintendo DS™
family of
systems
April 5, 2009
153.67 million WW
November 19,
2006
99.38 million WW
(inclusive of DS
Lite, DS and DSi)
Wii
Nintendo Marquee
Characters
(Appeared in “1 Million+”
Sellers)
First Appearance
Mario
1981 in Donkey Kong, Arcade
Pikachu
1996 in Pokémon Green (Japan
only), Game Boy
Donkey Kong
1981 in Donkey Kong, Arcade
Diddy Kong
1994 in Donkey Kong Country,
Super NES
Dixie Kong
1995 in Donkey Kong Country 2:
Diddy’s Kong Quest, Super NES
4
Zelda and Link
1997 in The Legend of Zelda,
Nintendo Entertainment System
(NES)
Yoshi
1991, Super Mario World, Super
NES
Star Fox
1993, Star Fox, Super NES
Kirby
1992, Kirby’s Dream Land, Game
Boy
Wario
1983, Mario Bros., Arcade
Samus Aran
1989, Metroid, Nintendo
Entertainment System (NES)
INTERNET PIRACY AND CIRCUMVENTION DEVICES
The most common way to play illegal Nintendo video games downloaded from the Internet for
free is to use circumvention devices, such as game copiers or modification chips.
Therefore, the trafficking in, sale and use of these
devices facilitate Internet piracy.
Game Copiers: Game copiers are circumvention devices used to bypass the security embedded
in Nintendo DS handheld systems to allow users to play illegal video games downloaded from
the Internet. Nintendo makes video games available for download on the Internet only through
its proprietary systems. Hence, all Nintendo game files offered via the Internet for download
are illegal copies.
The following section illustrates how game copiers work to circumvent Nintendo’s security and
how these circumvention devices facilitate the downloading of illegal game files from the
Internet.
5
This is a popular “game
copier.” A USB-to-Micro SD
flash memory card reader
(included in packaging) is
used to transfer illegal games
downloaded
from
the
Internet from computer to a
Micro SD flash memory card.
The game copier card (included in packaging) is
designed exactly like an authentic Nintendo DS
game card (except for the addition of a slot at
the top of the game copier card to accept a
Micro SD flash memory card). This card
contains copyright protected Nintendo
software (logo data) used to bypass the
security of the Nintendo DS system’s security
measures.
The user purchases the Micro SD flash
memory card separately. Game software
is illegally downloaded from the Internet
and stored on this Micro SD flash
memory card.
6
The Micro SD flash memory card
containing illegal game files is
inserted into the game copier
card.
The Micro SD flash memory card is here. The R4 game
copier is the most popular in the world.
The game copier card is
inserted into the Nintendo DS
card slot on the Nintendo DS
system to play the illegal game
files.
Game Copier Card v. Authentic Nintendo DS Game Card
Game copier card (note the Micro SD
flash memory card in the slot)
Authentic
7
Internet Piracy
The trafficking in, sale and use of circumvention devices facilitate Internet piracy of video
games because the most common way to play illegal Wii or Nintendo DS game files downloaded
from the Internet on Nintendo video game systems is by using circumvention devices, such as
the abovementioned game copiers and mod chips. Certain terms, defined below, are
commonly used when discussing Internet piracy.
Internet Piracy Definitions:
•
Cyberlinker - "Cyberlinkers," also known as "indexers," are websites that collect the
links (a.k.a. URLs) for infringing content that users have uploaded and stored on
cyberlockers. For a cyberlinker to be most effective, it must be vigilant in gathering the
most up-to-date links, eliminating those which no longer work (either because the
original user removed the file, the file was corrupted somehow or a copyright owner
had requested the file to be removed). The most popular cyberlinkers usually have a
dedicated community that contributes links (either from uploading the infringing
content themselves and sharing the link, or finding a working link from another source
and sharing it).
•
Cyberlocker - "Cyberlockers," also known as "sharehosts," "one-click hosts," or "direct
downloads (DDL)" are websites that provide storage space (varying in size but usually at
minimum several hundred megabytes, and at maximum a few gigabytes) for any file
type a user wishes to upload and store. After uploading a file, a user is commonly given
a password and/or a direct URL to access that file. Many users use this functionality to
store infringing content.
•
Marketplaces - Any auction site, trade board or classified listing website, like eBay,
Craigslist, Mercado Libre and Alibaba, operated with the express purpose of allowing
users to advertise, buy and sell products. These websites vary from auction-style bidding
to periodic sales postings or classified ads for services offered by other users. In many
cases, users looking to profit from illegal hard goods abuse these websites.
•
Monitoring & Enforcement - These terms describe the manual or automated search
techniques to locate and identify infringing content combined with manual or
automated issuance of legal notification (DMCA takedown notices, Cease-and-Desist
Letters or other legal warnings) to the appropriate Internet Service Provider (ISP). Rights
owners will either perform such techniques in-house, or hire vendor companies who
specialize in these services, as way to determine what infringing content is available
online and act upon it.
8
•
Peer-to-Peer (P2P) Networks - Computer networks, like BitTorrent and eDonkey,
established between users who share illegal Nintendo game files (or parts of files)
among themselves. Users download illegal Nintendo game files through accessing P2P
portal sites.
•
P2P Portal Sites - Websites that offer links, trackers, or indices to connect users to the
P2P networks for downloading illegal Nintendo game files.
•
Webshops/E-Commerce Sites - Internet retailers offering/distributing hard goods (game
copiers, mod chips, counterfeit Nintendo products) via a website. Each website typically
has one individual seller per website with no take-down procedure for notification of
infringement.
9
Most Prevalent Types of INTERNET PIRACY Impacting Nintendo
Cyberlockers
Cyberlocker Linking Sites.
Facilitate location of
content
(Hosted Content)
Examples – Megaupload, Hotfile
Websites.
Facilitate sale of pirated
games to consumers
Direct Download/ROM sites
(Hosted Content)
Examples – DS Downloads
P2P Networks
P2P Portal Sites.
Facilitate location of P2P
Content
(Content Made Available by
Individual Users)
Examples – BitTorrent, eDonkey
Auction Sites,
Trade Boards, Webshops
Sale of Hard Goods to
Consumers, Distributors
(Hard Goods)
Example- eBay, Craigslist, Alibaba
10
INFRINGING NINTENDO HARD GOODS
The chart below shows Nintendo video game products confiscated worldwide during seizures
from 2008 to 2012. Seizures include illegal copies of Nintendo games, circumvention devices
and component parts.
Nintendo believes the increase in online piracy has caused a decrease in seized hard goods
products, a trend Nintendo expects to continue.
Total Number of Infringing Nintendo Hard Goods
Seized 2008 - 2012
600,000
500,000
2008
400,000
2009
2010
300,000
2011
200,000
2012
100,000
0
*
U.S./Canada
Asia
*
*
*
* *
Europe
*
* *
11
*
Latin America
*
* *
*
*
*
BRAZIL
Nintendo recommends that Brazil remain on the Watch List.
Internet piracy continues with no adequate legal infrastructure in place to respond to the
threat it poses to rights holders.
Hard goods piracy for Nintendo persists in Brazil, with trends pointing toward a shift to Internet
piracy. Two popular areas for Internet access to illegal Nintendo video game files are through
peer-to-peer (P2P) and Portuguese language link sites (cyberlinkers) that link to host sites
(cyberlockers), most of which are not hosted in Brazil.
Illegal P2P downloads
The chart on the following page lists the top 10 countries where illegal P2P downloads are most
popular for Nintendo video games. Data comparing 2012 to 2011 shows that Brazil moved up
on Nintendo’s top 10 chart of illegal P2P downloads from 8th in 2011 to 3rd in 2012. Notably in
the same region, Mexico and Chile moved to the top 10 this year (though neither would have
made the top 10 under 2011 standards).
Nintendo expects to see an upward trend of Illegal P2P downloads
of video games in South America in 2013, as more countries in the
region increase broadband penetration and overall Internet
connections.
The 2012 decrease in overall number of downloads compared to 2011 is likely due to factors
such as fewer Nintendo video game releases and thus fewer games to monitor, as well as less
popular games as anticipation built for the release of the Wii U, and improved security in
Nintendo’s newer consoles.
12
Illegal P2P Downloads of Nintendo Games
January 1, 2012 to December 31, 2012 (Source: DtecNet)
Italy
Spain
Brazil
5,500,000
5,000,000
4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
USA
France
Germany
Mexico
Chile
UK
Russian
Federation
Illegal P2P Downloads of Nintendo Games
January 1, 2011 to December 31, 2011 (source: DtecNet)
USA
Italy
Spain
5,500,000
5,000,000
4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
Germany
China
France
UK
Brazil
Japan
Canada
Despite factors that led to lower 2012 P2P downloads overall, Brazil numbers notably still
increased by one-third (see chart on next page).
13
BRAZIL Illegal P2P Downloads of Nintendo Games
2010 - 2012 (Source: DtecNet)
1,000,000
2010
800,000
2011
2012
600,000
400,000
200,000
0
Portuguese Language Link Sites That Link to Host Sites
(most not hosted in Brazil)
In Brazil, cyberlockers (host sites) remain one of the most popular file sharing protocols, with
easy access provided by Portuguese language linking sites.
The example on the next page “Baixar jogos completes” translates to “Download full games.”
Unfortunately, identifying infringing content on host sites is a challenge
because the majority of Brazilian link sites use unique, localized
encryption services to hinder automated scanning, detection and
verification of links to infringing files. Most cases require a manual
search effort limiting the total amount of identifiable and enforceable
links.
14
15
Internet Auction Sites in Brazil
Internet auction sites provide an easy and relatively anonymous platform for transactions of
infringing products, especially game copying circumvention devices. MercadoLibre.com is Latin
America’s largest online trading platform with headquarters in Argentina and a branch office in
Brazil (mercadolivre.com). The chart below shows that the number of listings on Mercado Libre
selling game copiers in Brazil doubled in 2011 and then exploded in 2012 revealing a high
demand for the circumvention devices needed by Brazilians to play downloaded illegal video
games.
Nintendo appreciates the high compliance of take-down notices through Mercado Libre.
Nintendo has worked hard to educate auction sites around the world regarding which products
are illegal and why.
Statistics compiled by Nintendo’s monitoring service show Brazilian
auction sites offer twice as many circumvention devices than any other
country. It also shows that take-down notices do not deter sellers from
listing illegal products on the auction site.
Enforcement by the government, as well as publicity of actions against infringers, would help
deter the sale of game copiers on auction sites, especially with respect to repeat sellers, and
educate consumers against purchasing devices from these sites in the future.
Mercado Libre covers 13 Latin American markets,
and Brazil is its largest.
Internet Auction Sites - Number of Listings of Game
Copiers on Mercado Libre (Source: MarkMonitor)
2010
2011
2012
30,000
25,000
20,000
15,000
10,000
5,000
0
16
Top 10 Countries Offering Game Copiers for Sale – 2012
(Source: MarkMonitor)
Number of game copier listings found per month / per country via online marketplaces
1
2
3
4
5
6
7
8
9
10
Country
Brazil
United States
New Zealand
China
Netherlands
Venezuela
Mexico
Chile
Costa Rica
Canada
Jan
2247
1299
809
325
314
422
336
126
185
164
Feb
3023
651
970
46
303
289
228
53
147
130
Mar
2487
786
781
602
388
221
211
144
94
84
Apr
2469
734
520
116
345
202
181
96
61
84
May
3612
793
610
183
293
147
184
119
96
95
June
3313
973
659
87
319
227
157
115
77
131
July
2242
926
547
860
306
178
213
115
96
123
Aug
2568
1042
558
1154
394
191
222
95
64
100
Sept
4007
1412
492
562
333
191
146
104
86
65
Oct
1818
1616
680
504
391
167
173
146
139
92
Nov
364
1749
508
268
363
251
222
135
158
120
Dec
350
2087
451
162
458
423
197
151
194
119
Total
28500
14068
7585
4869
4207
2909
2470
1399
1397
1307
Top 10 Countries Offering Game Copiers for Sale – 2011
(Source: MarkMonitor)
Number of game copier listings found per month / per country via online marketplaces
1
2
3
4
5
6
7
8
9
10
Country
China
United States
New Zealand
Brazil
Venezuela
Spain
Mexico
Canada
Netherlands
Chile
Jan
1171
1808
372
311
425
523
199
311
45
118
Feb
506
1339
573
287
251
428
201
173
86
83
Mar
1837
2053
806
375
259
541
255
228
108
147
Apr
1134
3379
712
423
300
449
287
321
115
125
May
1626
3161
1214
307
182
659
152
384
181
107
June
8357
2124
1203
608
414
246
423
292
182
162
17
July
542
1358
1062
602
838
165
602
181
204
94
Aug
994
1667
950
581
553
128
429
201
291
128
Sept
1308
859
668
344
625
204
333
116
283
89
Oct
1717
1146
568
464
386
198
264
151
328
140
Nov
5398
1017
721
415
240
141
241
190
298
97
Dec
2800
953
692
1031
584
141
286
152
329
115
Total
27390
20864
9541
5748
5057
3823
3672
2700
2450
1405
2012 Rate of Compliance with Take Down Notices – BRAZIL
Source: MarkMonitor
100%
95%
90%
Mercado Libre
85%
Mercado Libre was the only Marketplace to which
Nintendo issued enforcement notices where the
listing location was determined to be Brazil.
80%
75%
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2011 Rate of Compliance with Take Down Notices – BRAZIL
Source: MarkMonitor
100%
95%
Mercado Libre
90%
Mercado Libre was the only Marketplace to which
Nintendo issued enforcement notices where the
listing location was determined to be Brazil.
85%
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Brazil has never acceded to the WIPO Copyright Treaty and has no specific laws to
protect IP owners from the unauthorized circumvention of technical protection
measures, nor laws holding Internet Service Providers liable for hosting infringing
web sites. This poses serious challenges when addressing the growing problem of
IP violations and illegal downloads available on Brazilian web sites. It is critical
that laws be passed addressing these two serious shortcomings.
18
High Tariffs and Taxes Drive Up Prices On
Authentic Hardware
Piracy is attractive in Brazil in part due to the extraordinarily high cost of authentic goods driven
up by high tariffs and taxes imposed on imported authentic video game products.
Average Wii, Nintendo DSi, Nintendo 3DS and Nintendo 3DS XL
Hardware Price in U.S. Dollars
$600
$544
$500
$400
$300
$396
Wii HW
$445
DSi HW
$318
$247
$200
3DS HW
$272
$202
$155
$170
$130 $99
$100
$200
3DS XL HW
$0
Brazil
Mexico
U.S.
Recommendations
•
Adopt and strictly enforce new laws that explicitly protect against the circumvention of
technical protection measures and trafficking in circumvention devices; hold Internet
Service Providers responsible for facilitating piracy under certain circumstances
including a requirement that ISPs take down infringing content when notified by a rights
holder representative.
•
Publicize legal actions and raids taken against infringers, especially for online piracy, to
increase awareness and deterrence.
•
Bring criminal prosecutions of major infringers, including those facilitating piracy on the
Internet. The courts must impose stronger penalties against IP crimes (both traditional
forms of piracy and online piracy) to raise awareness and foster deterrence.
*****
19
PEOPLES’ REPUBLIC OF CHINA
Nintendo recommends that China remain on the Priority Watch List and subject to Section 306
monitoring.
● China continues to be the hub of production for infringing Nintendo video game
products, including circumvention devices.
● Lax enforcement in China by authorities negatively impacts all areas including scant
customs seizures, few raids, and weak penalties.
•
Internet piracy enforcement in China requires a unique approach depending on whether
the infringing goods are sold on auction sites, through web-retailers, shared through P2P
networks, or downloaded directly.
For over a decade, China has been the hub of production for infringing Nintendo video game
products, including circumvention devices. China is the leading worldwide exporter of these
illicit goods.
Customs services in nine countries, including the U.S., across
three continents seized over 36,000 infringing Nintendo video
game products sourced from China in over 254 separate
seizure actions in 2012. This sourcing of products from China
is key to understanding the scope of Nintendo’s challenges
with piracy.
Furthermore, the Intellectual Property Rights: Fiscal
Year 2012 Seizure Statistics Report published by U.S.
Customs and Border Protection’s (CBP) Office of
International Trade, states that 72% of all seized
products in 2012 was sourced from China.
Chinese Customs
Chinese Customs must improve its efforts in 2013 to prevent exportation of game copiers and
other infringing products from China. As millions of infringing products continue to escape
China Customs’ inspection and are distributed around the world, far more attention must be
placed on shipments leaving the country, especially those in small parcels. The growing trend
of small packages carrying counterfeit and illegal products, sent via postal and carrier services,
20
poses the question: Is China Customs dedicating enough resources to thwart the export of
goods at post offices, airports, and by local courier services? Traditionally, China Customs
focuses more on stopping imports than halting export of illegal goods.
The map below shows more than two dozen local and provincial customs offices where
Nintendo conducted training programs in 2012, paying special attention to trainings offered by
Customs Offices located at post offices and airports.
But as the graph illustrates on the next page, despite intensive training in the detection of
counterfeit and infringing Nintendo products, China Customs detained only three shipments of
suspected infringing Nintendo game products; seizing a mere 171 products in 2012. This is a
substantial reduction from the 31 shipments and 4,266 products seized in 2011. Of equal
concern, China Customs did not seize a single circumvention device in 2012, despite the focus
on these illegal goods during Nintendo training programs.
The recent US Department of Homeland Security report Intellectual Property Rights: Fiscal Year
2012 Seizure Statistics Report, published by U.S. Customs and Border Protection’s (CBP) Office
of International Trade, finds an increase in the amount of seized counterfeit IPR goods sent by
mail. “Consistent with current trends, actual IPR seizures in the international mail and express
facilities continued to outpace IPR seizures in cargo and other environments for FY2012.”
21
Hard Goods Seized by China Customs vs.
Numbers of Actions
8,000
7,000
50
6,733
40
6,000
5,000
30
4,266
4,000
20
3,000
2,000
10
1,000
171
0
0
2010
2011
Products
2012
Actions
China Customs should make education and training of its customs agents a priority in
2013 in order to learn about identification of counterfeit products and illegal goods
such as circumvention devices. More importantly, vastly improving Customs’
performance will require a nationwide campaign to focus on this problem area and
increase resources and directives to provincial customs authorities.
The chart below identifies the local and provincial customs services that seized infringing
Nintendo video game products in 2010 through 2012. Further, the bar graph shows the
dramatic decline in the number of raids and goods seized by Customs authorities and
Administrative Law Enforcement agencies from 2008 through 2012. Some of this decline is
likely due to a worldwide shift to Internet piracy also taking place in China.
Customs conducting Seizures
2010
Guangzhou Customs
Shenzhen Customs
Hangzhou Customs
Nanjing Customs
Wenzhou Customs
Shanghai Customs
Kunming Customs
Total
6
33
2
1
1
0
0
43
22
2011
21
2
3
1
0
3
1
31
2012
3
0
0
0
0
0
0
3
The chart below includes all products seized in China through both (1) Customs authorities, and
(2) Administrative raids (i.e., AIC).
450,000
415,058
200
375,361
400,000
180
365,419
160
350,000
140
300,000
120
250,000
100
200,000
80
150,000
112,355
100,000
100,693
60
40
50,000
20
0
0
2008
2009
2010
Products
2011
2012
Actions
Online Marketplaces
Despite increased enforcement on China-based marketplaces, a huge number of infringing
Nintendo products listed on worldwide online marketplaces continue to originate from China.
In 2011 (see chart on next page), China led all countries worldwide in game copier listings found
per month. Nintendo has worked for several years with China-based marketplaces such as
Taobao to reduce the availability of game copiers. While most of these marketplaces have
improved enforcement against the devices (the updated 2012 chart on the next page shows
China as #4 worldwide) the majority of game copier products listed for sale on worldwide
marketplaces still originate in China.
23
Top 10 Countries Offering Game Copiers for Sale – 2012
(Source: MarkMonitor)
Number of Game Copier Listings Found per Month / per Country via Online Marketplaces
1
2
3
4
5
6
7
8
9
10
Country
Brazil
United States
New Zealand
China
Netherlands
Venezuela
Mexico
Chile
Costa Rica
Canada
Jan
2247
1299
809
325
314
422
336
126
185
164
Feb
3023
651
970
46
303
289
228
53
147
130
Mar
2487
786
781
602
388
221
211
144
94
84
Apr
2469
734
520
116
345
202
181
96
61
84
May
3612
793
610
183
293
147
184
119
96
95
June
3313
973
659
87
319
227
157
115
77
131
July
2242
926
547
860
306
178
213
115
96
123
Aug
2568
1042
558
1154
394
191
222
95
64
100
Sept
4007
1412
492
562
333
191
146
104
86
65
Oct
1818
1616
680
504
391
167
173
146
139
92
Nov
364
1749
508
268
363
251
222
135
158
120
Dec
350
2087
451
162
458
423
197
151
194
119
Total
28500
14068
7585
4869
4207
2909
2470
1399
1397
1307
Top 10 Countries Offering Game Copiers for Sale – 2011
(Source: MarkMonitor)
Number of Game Copier Listings Found per Month / per Country via Online Marketplaces
1
2
3
4
5
6
7
8
9
10
Country
China
United States
New Zealand
Brazil
Venezuela
Spain
Mexico
Canada
Netherlands
Chile
Jan
1171
1808
372
311
425
523
199
311
45
118
Feb
506
1339
573
287
251
428
201
173
86
83
Mar
1837
2053
806
375
259
541
255
228
108
147
Apr
1134
3379
712
423
300
449
287
321
115
125
May
1626
3161
1214
307
182
659
152
384
181
107
June
8357
2124
1203
608
414
246
423
292
182
162
July
542
1358
1062
602
838
165
602
181
204
94
Aug
994
1667
950
581
553
128
429
201
291
128
Sept
1308
859
668
344
625
204
333
116
283
89
Oct
1717
1146
568
464
386
198
264
151
328
140
The most popular and well-known brand of game copier in
the world is the “R4,” a brand of game copier manufactured
almost exclusively in China. Based on a search of the term
“R4 card” (game copiers are also referred to as “flash cards”
in pirate terminology), the Global Sources online website
shows four verified manufacturers: three from Mainland
China and one from Hong Kong.
24
Nov
5398
1017
721
415
240
141
241
190
298
97
Dec
2800
953
692
1031
584
141
286
152
329
115
Total
27390
20864
9541
5748
5057
3823
3672
2700
2450
1405
Global Sources (NASDAQ Symbol: GSOL), a Hong-Kong based B2B media company, provides
sourcing information to suppliers and provides quality assurance reports of product
manufacturers to prospective sellers. The Global Sources online website allows buyers to
contact manufacturers directly regarding products. Global Sources launched its China Sourcing
Fairs in 2003, with shows in Hong Kong, Mumbai, Dubai, Miami, Johannesburg and Sao Paulo.
Based on Nintendo’s global marketplace Internet monitoring in 2012, “R4” brand game copiers
accounted for 49% of game copier listings on all marketplaces globally in 2012. Over 80% of all
listings in seven of the other nine countries in the Top 10 (presented in the 2012 chart above)
are for “R4” game copiers (the other two countries, the United States and Canada, have 55%
and 71%, respectively). Modifying the 2012 chart above to allocate all of these R4 game copier
listings to China, easily makes the country #1 worldwide as shown in the chart below.
Country
1 China
2 United States
3 New Zealand
4 Brazil
5 Netherlands
6 Mexico
7 Canada
8 Chile
9 Venezuela
10 Costa Rica
Total
57881
6396
1346
1182
787
449
380
177
64
49
Shifting Internet Piracy in China Poses Unique
IP Enforcement Challenges
One of Nintendo’s major challenges in China has been the manufacture, distribution and sale of
circumvention devices that facilitate the downloading and play of illegal Nintendo games
available via the Internet. Coupled with the shifts in growth of Internet piracy, the challenges
remain significant.
Data from 2011 confirms that China was one of the top 10 infringing countries in the world for
illegal P2P downloads of infringing Nintendo games. China does not appear on the comparable
2012 chart and believe this is due to shifting consumer demand to different piracy protocols
rather than major decreases in piracy in China.
25
In 2011, Nintendo’s Special 301 submission cited factors that help explain the deceptively low
and inaccurate online piracy rate for China. One of the primary factors was that Internet
monitoring services used by rightsholders had yet to fully grasp the Chinese language nuances
in their monitoring techniques. In December 2012, Nintendo began testing a new service using
Internet monitoring capabilities located in Mainland China that searches in Chinese (Mandarin).
In roughly one month of testing, the service shows that cyberlockers/cyberlinkers and SNS (a
Chinese form of blogging sites/BBS forums) were the predominant location for pirated
Nintendo game files. Nearly 27,000 infringing links to pirated Nintendo game files were
discovered and if extrapolated to a full year, would translate to be approximately 324,000
infringing links, placing China 8th among the top 10 countries worldwide in a 2012 P2P chart.
Because cyberlocker links can provide access to multiple users,
the potential downloads from those 324,000 infringing links
easily could be double, triple or even quadruple that
number—propelling China to a top-5 or even top-3 country
globally for Internet piracy of Nintendo game products.
Recommendations
● Administrative authorities should issue stiffer penalties to ISPs, infringers,
sellers/distributors of circumvention devices in an effort to curtail the production and
distribution of illegal products.
● Customs at export must actively seize illegal products – especially illegal circumvention
devices leaving China for shipping abroad. The national government must place greater
emphasis and dedicate increased resources to improving customs’ ability to halt the
exportation of infringing items.
● Online marketplace websites must proactively monitor and remove listings of
circumvention devices and terminate repeat infringer accounts. Also, the process for
reporting IP violations to Administrative or other federal law enforcement bodies should be
made clearer and more efficient for IPR owners.
● Given the increase in shipment of infringing products in small parcels, more efforts should
focus on interdicting these shipments leaving the country, especially through postal
channels.
*****
26
MEXICO
Nintendo recommends that Mexico remain on the Watch List.
Mexico must address the growing Internet piracy problems and increased sales of
circumvention devices through online retailers.
Mexico should elevate IP enforcement as a priority and demonstrate its commitment to
doing so with an increase in prosecutions resulting in convictions with deterrent sentences.
Hard goods piracy in Mexico, found at notorious physical markets such as San Juan de Dios,
Tepito, Pericoapa and Meave, remains a major problem for Nintendo. Despite occasional raids
by authorities, these markets have sold illicit products for decades, with no end in sight. The
only way to end this scourge is through a government commitment to provide resources that
ensure permanent closure of markets offering counterfeit goods, and hold market owners
accountable for the booths engaging in illicit activities, as well as aggressively prosecuting IP
crimes and finding other creative strategies to stop the distribution of pirated Nintendo video
game products and other counterfeit goods.
The chart below shows the numbers of counterfeit Nintendo products seized in Mexico over the
past four years. Seizures rebounded in 2012 after a dismal enforcement performance in 2011.
Anti-piracy actions by authorities were especially deficient in 2011 due to changes in
government agencies, lack of resources and no defined priorities.
Total Counterfeit Products Seized – MEXICO
140,000
2009
120,000
2010
100,000
2011
80,000
2012
60,000
40,000
20,000
0
27
In 2012, criminal raid activity increased in the first half of 2012, yielding higher product seizure
numbers for Nintendo. The second half of 2012, however, produced no raids due to lack of
coordination between agencies (the specialized IP unit, police, and Attorney General’s office).
IP enforcement with a consistent focus on deterring piracy must be a year-round priority for
enforcement agencies. Raids must be followed with prosecutions, source investigations and
indictments, or recidivist vendors will continue to sell infringing products. Unfortunately,
without meaningful follow-up to raids in Mexico, there is little deterrent to piracy.
Illegal P2P Downloads
The Internet piracy trend in Mexico mirrors much of the rest of Latin America and the
world – Internet piracy increases with broadband penetration. Between 2010 and
2012, illegal P2P downloads of Nintendo video game files increased by more than
150%.
The chart below shows that, for the first time since Nintendo began monitoring for Internet
piracy, Mexico has entered the top 10 in illegal downloads. The Mexican Government cannot
ignore the attraction of online piracy for Mexican consumers, and they must establish a legal
infrastructure with resources to address piracy over the Internet now, as the problem certainly
will become worse in the years ahead.
Illegal P2P Downloads of Nintendo Games
January 1, 2012 to December 31, 2012 (Source: DtecNet)
Italy
Spain
Brazil
5,500,000
5,000,000
4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
USA
France
Germany
Mexico
Chile
UK
Russian
Federation
28
The chart below gives P2P download figures for the past three years, showing the sharp trend
in higher demand.
Illegal P2P Downloads of Nintendo Games in Mexico 2010 – 2012
(Source: DtecNet)
350,000
300,000
2010
250,000
2011
200,000
2012
150,000
100,000
50,000
0
The chart below presents the numbers of circumvention devices seized in Mexico over the past
three years. The Mexican Government must recognize Mexico’s video game piracy shift from
hard goods to Internet piracy facilitated through use of circumvention devices.
Number of Circumvention Devices Seized in Mexico
2010 - 2012
3,000
2010
2,500
2011
2,000
2012
1,500
1,000
500
0
29
Internet Auction Sites in Mexico
Internet auction sites provide an easy and relatively anonymous platform for transactions of
infringing products, including circumvention devices. In Mexico, consumers continue to trade
and sell infringing products on the auction site Mercado Libre, which is based in Argentina and
is the largest online marketplace in Latin America.
Despite a decrease in 2012, Mexico remained a top 10 country for offering game copier
circumvention devices for sale. The demand for game copiers correlates with demand to
download infringing Nintendo content from the Internet (i.e., but for the game copiers (and
other circumvention devices), pirated software would not play on Nintendo video game
systems). Nintendo does appreciate the strong compliance of take down notices through
Mercado Libre. Nintendo has worked hard to educate auction sites around the world regarding
which products are illegal and why.
Despite compliance by Mercado Libre, the continuation of sales of game copiers on online
auction sites shows that take down notices do not deter sellers from listing illegal products on
the auction site. Enforcement by the government and publicity of those actions against
infringers could help to deter the sale of illegal goods on auction sites and educate consumers
against purchasing infringing materials from these sites.
Top 10 Countries Offering Game Copiers for Sale – 2012
(Source: MarkMonitor)
Number of Game Copier Listings Found per Month/per Country via Online Marketplaces
1
2
3
4
5
6
7
8
9
10
Country
Brazil
United States
New Zealand
China
Netherlands
Venezuela
Mexico
Chile
Costa Rica
Canada
Jan
2247
1299
809
325
314
422
336
126
185
164
Feb
3023
651
970
46
303
289
228
53
147
130
Mar
2487
786
781
602
388
221
211
144
94
84
Apr
2469
734
520
116
345
202
181
96
61
84
May
3612
793
610
183
293
147
184
119
96
95
June
3313
973
659
87
319
227
157
115
77
131
30
July
2242
926
547
860
306
178
213
115
96
123
Aug
2568
1042
558
1154
394
191
222
95
64
100
Sept
4007
1412
492
562
333
191
146
104
86
65
Oct
1818
1616
680
504
391
167
173
146
139
92
Nov
364
1749
508
268
363
251
222
135
158
120
Dec
350
2087
451
162
458
423
197
151
194
119
Total
28500
14068
7585
4869
4207
2909
2470
1399
1397
1307
Top 10 Countries Offering Game Copiers for Sale – 2011
(Source: MarkMonitor)
Number of Game Copier Listings Found per Month/per Country via Online Marketplaces
1
2
3
4
5
6
7
8
9
10
Country
China
United States
New Zealand
Brazil
Venezuela
Spain
Mexico
Canada
Netherlands
Chile
Jan
1171
1808
372
311
425
523
199
311
45
118
Feb
506
1339
573
287
251
428
201
173
86
83
Mar
1837
2053
806
375
259
541
255
228
108
147
Apr
1134
3379
712
423
300
449
287
321
115
125
May
1626
3161
1214
307
182
659
152
384
181
107
June
8357
2124
1203
608
414
246
423
292
182
162
July
542
1358
1062
602
838
165
602
181
204
94
Aug
994
1667
950
581
553
128
429
201
291
128
Sept
1308
859
668
344
625
204
333
116
283
89
Oct
1717
1146
568
464
386
198
264
151
328
140
Nov
5398
1017
721
415
240
141
241
190
298
97
Dec
2800
953
692
1031
584
141
286
152
329
115
Number of Listings of Game Copiers on Mercado Libre - MEXICO
(Source: MarkMonitor)
2010
4,000
2011
3,000
2012
2,000
1,000
0
The Mexican website selling game copying circumvention devices shown on the next page
reveals the ease of accessing devices in Mexico that circumvent TPMs and support online
piracy.
31
Total
27390
20864
9541
5748
5057
3823
3672
2700
2450
1405
Repeat Offenders Bring Game Copiers into Mexico
Sellers, distributors and suppliers of game copying devices continue to import and assemble
products for Mexican informal markets. Nintendo is grateful that Mexican Customs notifies
rights holders of seizures and provides other identifying information that allows Nintendo to
recognize recidivist importers. In 2012, as just one example, Nintendo identified a single family
importing into Mexico multiple shipments of circumvention devices presumably to supply
informal markets in Guadalajara.
Because Guadalajara customs stopped several shipments this year with similar identifying
names and addresses, the importer started to import into Tijuana to avoid additional
detainment / screening, according to conversations between the importer and undercover
investigators.
We now have this importer name on red alert with Tijuana Customs in the event he brings
additional circumvention devices through Mexico.
32
September 2012 – These products were shipped from Hong Kong and are not finished goods –
they are intended for in-country assembly and distribution.
Labels are not affixed to the product but shipped separately, again, for in-country assembly and
distribution.
33
High Cost of Authentic Goods Makes Piracy More Attractive
Online piracy will continue to grow in popularity alongside Mexico’s increased Internet usage –
accessing content via illegal distribution sites and file-sharing networks offers an easy and
attractive alternative to purchasing legitimate goods at retail, especially when VAT taxes and
additional logistics costs drive up prices for legitimate hardware and software.
Average Wii, Nintendo DSi, Nintendo 3DS and Nintendo 3DS XL
Hardware Price in U.S. Dollars
$600
$544
$500
$400
$300
$396
Wii HW
$445
DSi HW
$318
$247
$200
3DS HW
$272
$202
$155
$170
$130 $99
$100
$200
3DS XL HW
$0
Brazil
Mexico
U.S.
Recommendations
● Mexico must recognize the technological evolution by updating its legislation by making
the circumvention of technological protection measures a criminal offence in Mexico,
including provisions to impose sanctions for distributing/trafficking devices that
circumvent technical protection measures.
•
Mexico also must address its lack of norms in the area of ISP responsibility.
•
Mexico should dedicate additional resources and provide opportunities for all law
enforcement authorities and judges dealing with intellectual property matters to
regularly attend courses to improve their knowledge of IP laws and effective
enforcement procedures.
•
Mexican courts and prosecutors must prioritize IP cases, seeking convictions to create
deterrence in the future.
•
The Mexican Government must be consistent and place emphasis on actions to stop
illegal vendors, suppliers and online piracy regimes – especially concerning repeat
infringers.
*****
34
SPAIN
Nintendo recommends elevating Spain to the Watch List.
● More resources must be given to the IPC to effectively implement the intention of Ley
Sinde.
● Spain is a piracy haven for the global distribution of circumvention devices.
● The high level of downloads by Spanish users on P2P networks directly correlate to the
availability and use of circumvention devices locally.
Spain remains one of the global leaders in the sale and distribution of circumvention devices
and for illegal downloads of video games from the Internet. The Spanish Government has
moved slowly to confront Internet piracy. Legislation to improve the piracy landscape in Spain
finally passed in 2011. The law established the Intellectual Property Commission (IPC), but the
IPC has been slow to address Spain’s wide spread piracy and must be given additional resources
to fulfill its mission.
Illegal Peer-to-Peer (P2P) Piracy
The chart on the next page shows that Spain remains in the top three of Nintendo’s top 10
chart of illegal P2P downloads for 2012. Despite the huge population difference between the
U.S. and Spain, Spain saw 80% more illegal downloads than in the U.S. in 2012. While the total
number of downloads in Spain dipped in 2012 compared to 2011, Nintendo does not believe
this reflects any impact of the Ley Sinde. The decrease is more likely due to factors such as
fewer Nintendo video game releases and thus fewer games to monitor, as well as less popular
games as anticipation built for the release of the Wii U, and improved security in Nintendo’s
newer consoles.
35
Illegal P2P Downloads of Nintendo Games
January 1, 2012 to December 31, 2012 (Source: DtecNet)
Italy
Spain
Brazil
5,500,000
5,000,000
4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
USA
France
Germany
Mexico
Chile
UK
Russian
Federation
Illegal P2P Downloads of Nintendo Games
January 1, 2011 to December 31, 2011 (source: DtecNet)
USA
Italy
Spain
5,500,000
5,000,000
4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
Germany
China
France
UK
Brazil
Japan
Canada
Note: In 2011, 45 Nintendo titles were monitored. In 2012, 36 Nintendo titles were monitored.
36
The chart below shows the 10 most popular Spanish-language P2P Portal Sites. None of the
domains have been registered in Spain, and non-Spanish Internet hosting providers host almost
all of the websites, illustrating the separation between the content and the users trying to
access that content.
Top 10 Most Popular Spanish-language P2P Portal Sites
P2P Portal Site
Domain Registrar
divxtotal.com
ENOM, Inc.
mejortorrent.com
GODADDY.COM,
LLC
INTERNET.BS
CORP
ENOM, Inc.
divxatope.com
newpct.com
gamestorrents.com INTERNET.BS
CORP
todocvcd.com
INTERNET.BS
CORP
tomadivx.com
GODADDY.COM,
LLC
lokotorrents.com
GODADDY.COM,
LLC
torrentspain.com
ENOM, Inc.
contorrent.com
PDR (Public
Domain
Registry.com)
Domain
Registrar
Country
United States
(Bellevue, WA)
United States
(Scottsdale, AZ)
Bahamas
Webhost (ISP)
Webhost (ISP)
Country
Ecatel
Netherlands
Rackmarkt S.L.
Spain
Rackmarkt S.L.
Spain
United States
(Bellevue, WA)
Bahamas
Intergenia
Germany
T-N Media
Germany
Bahamas
Ecatel
Netherlands
United States
(Scottsdale, AZ)
United States
(Scottsdale, AZ)
United States
(Bellevue, WA)
India
Rackmarkt S.L.
Spain
OVH Hispano
Spain
OVH Systems
United Kingdom
CariNet
United States
37
Cyberlocker Piracy
Top 10 Spanish Language Linking Sites
January 1, 2012 to December 31, 2012
vagos.es
18,000
gratisjuegos.org
16,000
argentinawarez.com
14,000
ba-k.com
12,000
emudesc.net
10,000
pordescargadirecta.com
8,000
sinjuegospc.com
6,000
descargarjuegosmx.com
4,000
chilecomparte.cl
2,000
todoroms.com
0
The chart above and table below further illustrate the foreign hosting trend for Spanish Internet
user piracy.
Link Site
Country
ISP
Web
Pages
Files
Shared
Web
Infringements
1050
2231
16738
1154
2027
11957
824
1431
9198
vagos.es
Netherlands
gratisjuegos.org
United States of America
argentinawarez.com
United States of America
LeaseWeb B.V.
SoftLayer
Technologies
SoftLayer
Technologies
ba-k.com
Spain
Ovh Systems
604
1139
8680
emudesc.net
Spain
430
730
4000
pordescargadirecta.com
Spain
272
481
3466
sinjuegospc.com
United States of America
Ovh Systems
Comvive
Servidores S.L.
Hosting Solutions
International
83
170
1890
descargarjuegosmx.com
Netherlands
27
151
1640
chilecomparte.cl
Colombia
RouteLabel V.O.F.
IFX NETWORKS
COLOMBIA
83
185
1355
todoroms.com
Spain
Ovh Systems
124
194
1289
4651
8739
60213
TOTAL
38
Circumvention Devices Remain Widely Available In Spain
Nine out of ten of the most popular (by traffic ranking) e-commerce sites that offer
circumvention devices for sale within the European Union are hosted and operate from Spain
(as demonstrated in the below table). These e-commerce sites specialize in the sale of game
copiers not only to Spanish customers but also deliver to the majority of EU Member States and
beyond (including shipping to the US).
Domain
Selling
Country
ISP Hosting
Country
Est.
Daily
Visitors
Language
ISP Name
chipspain.com
Spain
Spain
12,500
Multiple
acens Technologies,
S.L.
discoazul.com
Spain
Spain
6,800
Multiple
Ovh Systems
locuradigital.com
Spain
Spain
5,200
Spanish
Grupo Interdominios
S.A
e-nuc.com
Spain
Spain
4,800
Multiple
ONO
electronicweb2001.com
Spain
United
States
3,800
Spanish
Affinity Internet
incopia2.com
Spain
Spain
4,600
Spanish
Axarnet
Comunicaciones SL
todoconsolas.com
Spain
Spain
3,800
Spanish
R cable y
telecomunicaciones
euroconsolas.com
Spain
Spain
3,600
Spanish
acens technologies
foxchip.com
France
France
2,700
French
Ovh Systems
tuconsola.com
Spain
Netherlands
3,100
Multiple
LeaseWeb B.V.
As Nintendo has obtained more and more positive court decisions against game copier sellers in
other EU Member States (e.g. France, Germany, Italy, UK, Belgium and the Netherlands),
Nintendo has identified an increase in the number of e-commerce sites selling game copiers
39
operating from Spain to such an extent, that in Nintendo’s opinion (and confirmed by the data
set out in the above table) Spain has become a haven for sellers of game copiers.
Spain has ratified the WIPO Copyright Treaty (WCT) and has
faithfully transposed the respective provisions of the
Copyright and Computer Programs Directives into national law
(Intellectual Property Code) but gaps still exist in its criminal
law provisions for the protection of copyright works against
the commercial dealing of devices designed to circumvent
technological protection measures (TPMs).
These gaps have led to an inconsistent application of the
criminal law provisions by Spanish criminal courts. Since 2007,
a number of prosecutions brought by the Spanish authorities
and supported by the video games industry association
(ADESE) or by Nintendo (both acting in their capacity as a civil
party) have borne out these deficiencies in the criminal law
provisions.
Multiple criminal cases are being erroneously concluded because the test the courts are
employing involves applying a standard that requires the circumvention devices that are the
subject of the case be “specifically designed for purposes of circumvention,” thus imposing
liability only if the device is shown to be incapable of non-infringing uses. In interpreting this
provision, the Spanish criminal courts have been distracted by the potential secondary use of
circumvention devices once the TPMs are circumvented by the device, although these
secondary uses cannot be undertaken without first circumventing the TPMs deployed in
authentic games and consoles.
In taking such a narrow approach, the Spanish Courts are
effectively undermining and nullifying the overall objective of
these anti-circumvention provisions.
Once these devices circumvent the TPMs the user is then capable of performing, within reason,
any secondary uses and most users will use the device to play unauthorized copies of pirated
games (in fact the charts in the above chart confirm this) but there will always be the option of
secondary non-infringing use. This option, however commercially insignificant should not be
able to defeat the overall intention and objective of the anti-circumvention provisions.
In addition, with respect to video games, multiple copyrighted works are being protected by the
TPMs employed by rights holders but there is no explicit language in the Spanish Penal Code
transposing the respective provision of the EU Copyright Directive (Article 6) as it applies to
40
copyright works other than computer programs. The current language of Article 270.3 of the
Penal Code does not expressly include a prohibition against the trafficking of devices primarily
designed for the purposes of circumvention or which have only commercially limited uses other
than circumvention. Having such wording included explicitly in an amended provision of the
Penal Code can only add clarity and greater consistency where Spanish criminal judges seek to
apply this provision.
Legislative amendments would ensure that the provisions function as intended to effectively
prosecute the importation and distribution of circumvention devices because unfortunately,
many Spanish courts have interpreted the statute as imposing liability only upon proof that the
“sole purpose” of the device is to circumvent TPMs in order to facilitate piracy.
As a result, defendants engaged in the commercial distribution of devices primarily used to
defeat Nintendo’s TPMs (and thus enable the use of infringing copies of games) routinely
escape liability by simply arguing that such devices are capable of incidental and commercially
insignificant and secondary non-infringing uses.
Below is a list of negative judgments rendered by Spanish criminal courts (where Nintendo
acted as civil party) based on their interpretation of the Spanish Criminal Code.
•
•
•
•
•
•
May 31, 2010 - Investigation Court #11 Sevilla (Cayo Sistemas case)
March 24, 2011 - Investigation Court #4 Salamanca (Movilquick case)
May 6, 2011 - Investigation Court #3 Ciudad Real (Francisco Salinero Palomares case)
June 6, 2011 - Penal Court #1 Aviles (Alechip case)
April 23, 2012 - Appeal Court Ciudad Real (Francisco Salinero Palomares case)
June 12, 2012 - Penal Court #21 Madrid (1314 Informatica case)
Not all cases have been lost -- the following are positive judgments:
Criminal Court of Madrid, 26 March 2012
Considers Art 270.3 of the Criminal Code. Defendant liable for selling Game Copiers which were
devices for piracy which circumvent Nintendo's software protection measures.
Custodial sentence suspended in lieu of a fine.
Criminal Court Palma de Mallorca, 15 February 2011
Articles 270.1 and 270.3 of the Criminal Code. Sale of devices (Game Copiers) which circumvent
the TPMs applied by Nintendo.
Custodial sentence suspended in lieu of a fine.
Criminal Court Palma de Mallorca, 10 September 2010
Games copier case under Art 270.1 of the Criminal Code.
Ordered to pay €4,000 damages to Nintendo as well as a fine.
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Recommendations
•
Additional resources are required to support and respond to complaints filed by rights
holder associations before the IP Commission. These additional resources to allow the IPC
to more efficiently process a greater volume of complaints.
•
Since so many illegal video games are downloaded in Spain from foreign-based
cyberlockers, and accessed through cyberlinkers or P2P linking sites hosted outside Spain,
the IPC must address this issue by authorizing the blocking of linking sites.
•
Courts should be provided with greater resources to take on additional IP cases. Due to an
overloaded Spanish judicial system, IP cases move too slowly to resolution.
•
The reform of the Penal Code should include an amendment for new Article 270.4 stating:
"The same penalty shall also be applied to those who manufacture, import, distribute, put into
circulation, make available, sell, rent, advertise for sale or rental, or possess for commercial purposes
any means, device, product or component or who performs or provides a service which is primarily
designed, produced, adapted or performed for the purpose of enabling or facilitating the
circumvention of any effective technological measure that is used to protect any of the other works,
interpretations or implementations in the terms set out in Section 1 of this Article” (Article 270 of the
Spanish Criminal Code).
*****
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CONCLUSION
The Special 301 process has become one of the most effective tools the U.S. has to encourage
countries to make the necessary commitment to improve their intellectual property protection
to the level of international standards. Nintendo of America Inc. respectfully submits its
recommendations on Brazil, China, Mexico and Spain. Nintendo welcomes the opportunity to
work with USTR and other involved federal departments and agencies in any way possible to
reduce piracy in all countries, and would be pleased to provide any further information or
documentation.
Very truly yours,
NINTENDO OF AMERICA INC.
Jacqualee J. Story
Executive Vice President, Business Affairs
43