Nintendo & The Pokémon Company v. Pocketpair (Palworld) patent infringement lawsuit attempts to monopolize game rules

For some background, games fray‘s sibling site ip fray is the leading resource on (at least certain categories of) patent infringement lawsuits, and frequently acknowledges that innovators have the right to benefit from their patented inventions. Just yesterday, ip fray reported on a press conference on an innovative supercomputer firm’s patent infringement action against the world’s most valuable corporation, Nvidia, without disputing the patentee’s entitlement to its day in court (November 7, 2024 ip fray article).

However, Nintendo v. Pocketpair is troubling for different reasons, including from an innovation policy perspective.

Bullying with opportunistically drafted patents

First, it is a clear case of bullying. Nintendo is a far older and larger company than Pocketpair with extensive experience in patent prosecution and patent infringement litigation. What Nintendo originally insinuated in a public statement (January 25, 2024 games fray article) was that Pokémon-specific intellectual property rights or “assets” (such as graphics) were used in the making of Palworld. It would obviously be unlawful to attach the Pokémon label to a third-party game, or to import Pokémon characters into another game, without permission.

Back in January when Nintendo issued the statement, it apparently had nothing specific in its intellectual property portfolio to underpin its suggestion of infringing acts on Pocketpair’s part.

All that Nintendo has done in the meantime is

• to file new patent applications (in February, March and July of this year) building on older patent filings from 2021 and
• to assert those game rule patents in Japanese court.

But Nintendo has not

• identified a single patent that existed at the time of Palworld’s release (or Nintendo’s statement) and was allegedly infringed,
• shown an infringement of any other type of intellectual property right, such as copyright (in images) or design rights or
• made any argument under trademark law (“Nintendo” and “Pokémon” obviously being among the gaming industry’s most valuable trademark rights).

Pursuit of injunctive relief is key, damages claims are negligible for now

At first sight, one might be misled into thinking that what Nintendo is doing here is not going to do major damage, or that Nintendo was simply trying to rake in some license fees. Not so.

Pocketpair explains what remedies the complaint asks the Japanese court to order:

• An injunction against Palworld
• Payment of 5 million yen plus late payment damages to The Pokémon Company
• Payment of 5 million yen plus late payment damages to Nintendo Co., Ltd.

The total damages amount of 10 million yen, which is approximately $66K, is obviously not a major threat in and of itself. But the following factors must be considered:

• The real threat to Pocketpair is the request for an injunction.
• The three patents-in-suit were filed and published a while after Palworld’s release, thereby limiting the damages period and capturing only some more recent Palworld sales.
• Palworld’s Japanese revenues during that period will have been limited as Japanese gamers mostly play on Nintendo and Sony consoles, not on Xbox, the console on which Palworld achieved its breakthrough.

Patent thicket strategy

What Nintendo is trying to do with the three patents-in-suit in this litigation and possibly others that are in the making (and may not even be discoverable yet) is to create a patent thicket. That term describes a multiplicity of patents sharing a common context in an attempt to block all roads. What Nintendo wants to achieve is that Palworld cannot be Palworld because as long as its game mechanic of capturing monsters is the one it is, there will be some Nintendo patent in Japan that stands in the way. Roadblock after roadblock.

The three patents-in-suit

All three patents-in-suit were derived from original patent applications filed jointly by Nintendo and The Pokémon Company on December 22, 2021.

After Palworld’s release, Nintendo tried to tweak the patent claims (a patent claim is the part that defines the scope of protection of a patent) in order to obtain patents that would read specifically on Palworld and, collectively and possibly along with other patents, have the effect of a patent thicket.

These are the three 2024 patents that Nintendo derived, a while after Palworld’s launch, from its 2021 applications in order to prepare for this legal battle:

• JP7545191 (application filed on July 30, 2024; patent granted on September 4, 2024)
• JP7493117 (application filed on February 26, 2024; patent granted on May 30, 2024)
• JP7528390 (application filed on March 5, 2024; patent granted on August 5, 2024)

No technological innovation, just new game rules

The problem is that none of what Nintendo claims to have “invented” is a technological invention. All of the “innovation” lies in the related game rules, but games rules per se are not patentable. The presence of a game rule in a patent is not fatal as long as there is a technical invention involved. In order for something to be patentable, it must have been new (at the relevant time, which is the priority date; in this case, December 22, 2021 is the relevant date for each of the patents) and inventive (i.e., not what anyone presented with the given task would obviously do).

Validity is going to be the single most important battlefield between Nintendo and Pocketpair, and it is where Nintendo will face some serious challenges.

The main claims of the three patents-in-suit

In order to understand what those patents are meant to cover, one has to look at the claims. Each patent has multiple claims, but the starting point is the first claim of each patent. Note that patents mentioned in a specific context are often referred to by only the last three digits. Further above you can find the full-length patent numbers. Also, the bullet points and indents below were added by games fray and are meant to make the claims easier to read. The numbers of the different claim elements were also added by games fray for easier referencing. It is possible that upon further reflection, the numbering would be modified (also, it could become more granular).

JP’191 patent

• On the computer,
• (1) when
  • (1.1) a first category group including a plurality of types of capture items for capturing a field character arranged on a field in a virtual space
  • (1.2) is selected based on an operation input of pressing an operation button,
• (2) the player character in the virtual space is made to take a stance to release the capture item,
• (3) and when
  • (3.1) a second category group including a plurality of types of combat characters that engage in combat is selected,
  • (3.2) the player character in the virtual space is made to take a stance to release the combat character;
• (4) determining a direction of aim within the virtual space based on a directional input;
• (5) further selecting,
  • (5.1) based on an operation input using an operation button different from the operation button,
  • (5.2) the capture item included in the first category group when the first category group is selected,
  • (5.3) and the combat character included in the second category group when the second category group is selected;
• (6) based on an operation input of releasing the operation button that has been pressed when causing the player character to perform the ready action,
  • (6.1) when the capture item is selected, the player character is caused to perform an action of releasing the selected capture item in the aiming direction, and when the combat character is selected, the player character is caused to perform an action of releasing the selected combat character in the aiming direction;
  • (6.2) when the capture item is released and hits the field character, a capture success determination is made as to whether or not the capture is successful;
  • (6.3) When the capture success determination is affirmative, the field character hit by the capture item is set to a state in which the field character is owned by the player;
• (7) The game program causes a battle between the combat character and the field character on the field to commence when the combat character is released into a location where the combat character can fight with the field character.

JP’117

• The computer of the information processing device
• (1) In the first mode,
  • (1.1) determining a direction of aim in the virtual space based on a first operation input which is a directional input;
  • (1.2) when a second operation input is performed, the aiming direction is directed toward a field character disposed on a field in a virtual space, and a first indicator is displayed;
  • (1.3 making the player character perform an action of releasing a capture item for capturing the field character in the aiming direction based on a third operation input;
  • (1.4) when the capture item hits the field character, a capture success determination is made as to whether or not the capture is successful;
• (2) When the capture success determination is affirmative, the field character hit by the capture item is set to a state in which the field character is owned by the player;
• (3) The first indicator is information indicating the ease of making a positive judgment of the successful capture judgment.
• (4) The field character that has been successfully captured is available to the user as a combat character that engages in combat.

JP’390

• The computer of the information processing device
• (1) A player character is controlled based on an operational input within the virtual space;
• (2) when one of a plurality of types of rideable characters that the player character can ride is selected from among the characters owned by the player character and a riding instruction is given, the player character is made to ride the selected rideable character and made movable;
• (3) when a first operation input is performed while the player character is in the air, the player character is caused to ride on an airborne rideable character among the rideable characters , which is capable of moving in the air, to be in a state where the player character is capable of moving in the air;
• (4) A game program for moving the player character riding on the aerial riding character in the air based on an operation input while the player character is riding on the aerial riding character. 

Run-of-the-mill technical means

The patent claims reference a lot of technical things and concepts. But there is nothing in there that constitutes a technological innovation in the sense of making better use of computer resources or enabling a computer to solve a technical problem with technical means in a way that was not done before and would not have been obvious to do.

This is not about a faster 3D engine, about more efficient use of internet bandwidth or anything like that. If one showed the related game mechanics to a programming team and asked them to implement it, none of them would be challenged: it would be totally obvious to the, what they would have to do. Nintendo’s patents don’t tell them anything they would need to know because they couldn’t easily figure it out themselves.

Are those new (2024) patent claims backed up by the 2021 applications?

If Nintendo had filed new patent applications in 2024, after Palworld’s release, covering things that Palworld does, then Palworld itself could be used as prior art to invalidate those Nintendo patents. Instead, Nintendo’s three patents-in-suit all claim the 2021 priority date of an older patent application.

At least one of the underlying 2021 applications acknowledged (as it could hardly have denied) that “there are game programs in which a player character throws a ball at a character in a virtual space, capturing the character and setting it in the player character’s possession.” But the patent applications then argue that they talk about how to do something different. That is true, but all that is different is in the realm of game rules.

Pocketpair can’t prevent Nintendo and The Pokémon Company from filing for derivative patents in 2024 that claim the priority of a 2021 application. Patent law allows that. But there could be disagreements over whether the original 2021 applications disclosed everything that the 2024 applications claimed. If there is a lack of support for anything important in the 2021 applications, an impermissible addition of subject matter or an intermediate generalization could be alleged, and that could shoot one or more patents down.

Implications for the games industry

If patents cover genuine technological innovation, then some may still oppose them for whatever reasons, but it just means that game makers (and console makers) have to play by the same rules as other segments of the technology industry.

If, however, companies write patent applications that are effectively just smokescreens (designed to hide the fact that there is no genuine technological innovation involved), the net effect is that companies monopolize game rules. That would set a terrible precedent for the industry. It would lead to a lot of litigation between industry players, and it would subject game companies to so-called “patent troll” lawsuits over game rules. Making games would become a minefield.

Nintendo and The Pokémon Company have every right to protect their crown jewels against plagiarism. But the facts that have now become known about their Japanese patent lawsuits against Pocketpair suggest that there is no plagiarism issue. It’s just an attempt to leverage the patent system against a smaller company and late entrant to the market that has made and continues to make many millions of gamers happy because of its fresh creative ideas and the way it executed them.

No one and nothing would have stopped Nintendo from making a Palworld-style game. It may not have wanted to do so for conceptual reasons. It may also have been too complacent to rethink its game concept. But its patent lawfare does nothing to back up its January 2024 insinuations of plagiarism. Nintendo has merely come up with a bunch of contorted patent claims, drafted a while after Palworld’s release.