Impact and legacy
After the dispute was resolved in favor of Codemasters, it cleared the way for third party accessories that enabled cheating and modification, including a Game Genie model for the Nintendo Game Boy.[12] Codemasters became confident of the legality of the Game Genie, as well as its commercial potential.[3] Sega also came to an agreement with Codemasters to sell an official Game Genie device for the Sega Genesis, but only after Codemasters privately issued an ultimatum and promised to "open [the] floodgates" through a lawsuit, according to Codemasters developer Richard Alpin.[3]
The Game Genie was considered non-infringing for two major reasons: that it did not create a new permanent work, and that Nintendo did not prove they experienced any present or potential market harm.[13][14] In the Handbook of Intellectual Property Claims and Remedies, the author Patrick J. Flinn argued that Nintendo failed to take into account a fair use analysis, and that there was no real evidence that the Game Genie hurt their business.[15]
Galoob v Nintendo signaled a change in the legality of third party game products of all kinds.[16] In the same year, the case was cited in Sega v. Accolade (1992), which held that there was no copyright infringement when Accolade reverse engineered the Sega Genesis to publish third party games without Sega's authorization.[17] The Hastings Communication and Entertainment Law Journal reacted to both cases, comparing the court's interpretations of both derivative works and fair use, and concluded that courts were shifting to allow more interoperability between technologies.[18] The Journal of Intellectual Property Law compared both the Sega and Galoob cases to the earlier fair use case in Sony Corp. of America v. Universal City Studios (1984), concluding that a new technology shouldn't trigger copyright liability as long as it doesn't undermine a copyright owner's ability to earn a fair return for their works.[19] The Golden Gate University Law Review praised the Galoob court for following fair use doctrine and refining the definition of a derivative work, allowing new innovations without jeopardizing the incentive to innovate.
By deterring companies from being overly litigious, the case was essential to the future of video game modding in the United States and globally.[2] Soon after the court decided Galoob, video game mods became more widespread, particularly with the popularity of Doom and the permissive attitude of its developer, Id Software.[22] As third parties began to sell compilations of user-created levels, Micro Star created Nuke-It, a compilation of 300 custom made levels for Duke Nukem 3D,[23] provoking a copyright dispute with the game's developers.[22] In the ensuing lawsuit Micro Star v. FormGen (1998), Judge Alex Kozinski distinguished the infringement of Micro Star's compilation from the non-infringing Game Genie,[24] because the Nuke-It compilation was a permanent derivative work, and it was misappropriating profits from a potential Duke Nukem sequel.[25]
The question of whether a modification creates a new derivative work arose outside of the game industry in 2001, when television networks and studios sued SONICblue over the commercial-skipping feature of their digital video service, ReplayTV.[26] However, SONICblue filed for bankruptcy, and its new ownership agreed to remove the commercial-skipping feature before courts could decide how Galoob applied.[26] This issue also arose with the proliferation of "clean" edits of films, particularly a 2003 dispute involving ClearPlay technology that performed this filtering in real-time.[24] The dispute became moot with the passage of the Family Entertainment and Copyright Act of 2005, which expressly permitted digital filtering, without changing the application of copyright law to cut-and-splice film edits.[27]
The copyright cases of Midway, Galoob, and Micro Star continue to guide the law around game modifications, that a permanent modification is likely copyright infringement, where an impermanent modification is not.[28] The Galoob precedent has led courts to permit the use of third-party software to manipulate and cheat at other games.[29] This was later addressed in the Digital Millennium Copyright Act (1998), which limited people from creating technology that is "primarily designed or produced for the purpose of circumventing a technological measure that effectively controls access" to a protected work.[29]
