Nintendo's patents were designed to take on Palworld

On September 19, 2024, Nintendo Co. issued a press release stating that it, along with The Pokémon Company, had officially filed a lawsuit against Pocketpair, Inc. in Tokyo District Court. As stated in the press release the "lawsuit seeks an injunction against infringement and compensation for damages on the grounds that Palworld, a game developed and released by [Pocketpair], infringes multiple patent rights."

Most people know what Pokémon is. Palworld, released into early access on January 19, 2024, arguably represents the most direct competition Pokémon has had in some time. For context, only one month after its release, Palworld had been played by over 25 million players, which puts it on par with the lifetime sales of recent blockbuster games like The Legend of Zelda: Tears of the Kingdom and Hogwarts Legacy (both released in 2023).

Importantly, Palworld is a survival game developed and published by Pocketpair that is "set in an open world populated with animal-like creatures called 'Pals,' which players can battle and capture to use for base building, traversal, and combat."

While the news of this lawsuit is obviously provocative in its own right, the fact that Nintendo is bringing suit for patent infringement rather than copyright infringement ratchets up the interest level even further (not to mention the interesting timing of the lawsuit with the imminent Tokyo Game Show).

Some have speculated that Nintendo's assertion of patents indicates that it has "given up" on pursuing copyright infringement claims. Given Nintendo's notoriously litigious reputation, I don't necessarily believe that Nintendo has fully forgone the possibility of suing for copyright infringement (either in Japan or in other jurisdictions).

Still, I do think arguing that Pals too closely resemble their Pokémon counterparts in appearance might be tough sledding. Hence, as I detailed in my PatentDocs post from earlier this year, I would be surprised if we see Nintendo sue Pocketpair over copyrights / trade secrets in the U.S. (absent some smoking gun regarding improper access to Pokémon's underlying 3D models).

At this point, I think the more salient question is whether Nintendo will pursue patent litigation against Pocketpair in the U.S. similar to the Japanese patent litigation. This is a bit tough to determine given the lack of information we have regarding the underlying Japanese patent suit.

In recent years, the industry has moved away from patents, especially for in-game features. If Nintendo succeeds, perhaps this paradigm could be in question

At the time of writing, Pocketpair itself appears to still be "unaware of the specific patents [they] are accused of infringing upon." Hence, unlike in traditional U.S. patent litigation, it would appear that a publicly available complaint that expressly lists each of the allegedly infringed patents is not currently available in the Japanese suit.

Notwithstanding, some have prognosticated on which Nintendo/Pokémon assets they believe might be asserted based on: (i) co-ownership between the two co-plaintiffs and (ii) the timing of Nintendo's patent application filings.

In particular, a Japanese patent attorney generated a list of 28 possible patents, noting that the following Japanese issued patents – JP 7545191, JP 7528390, JP 7493117, and JP 7505854 – were especially relevant. Based on machine translations, each of these patents relates to different aspects of catching and/or riding "combat characters" / "airborne rideable characters" / "field characters" (e.g., Pokémon) using "player characters."

Further, each of these patents were filed as divisionals off of pre-existing patent families after the release of Palworld and were accelerated to issuance using Japanese expedited examination procedures.

Given the above, let's use the four JP assets mentioned as a starting point. For reference, there appear to be four U.S. counterpart applications (i.e., applications filed with the United States Patent and Trademark Office that share a common priority claim with at least one of the four JP assets above) – U.S. App. No. 17/949,666 ("US-App-1"), U.S. App. No. 17/949,831 ("US-App-2"), U.S. App. No. 18/652,874 ("US-App-3"), and U.S. App. No. 18/652,883 ("US-App-4").

US-App-1 and US-App-2 were both filed in September 2022, so it is unlikely they were filed with the specific intent of targeting Palworld (though could still obviously be asserted against Palworld if infringed). However, US-App-3 and US-App-4 were both filed in May 2024 (after the release of Palworld).

Even more interesting, both US-App-3 and US-App-4 were filed with Track One requests. Track One is a program at the United States Patent and Trademark Office (USPTO) where an applicant pays a fee to have the examination of their patent application substantially expedited (the USPTO attempts to provide the applicant with a final disposition, which is either an allowance or a final rejection, within at most 12 months).

Based on this information, it is not overly speculative to assume Nintendo filed US-App-3 and US-App-4 with the intention of targeting Palworld.

The first independent claim of US-App-3 currently recites:

1. A non-transitory computer-readable storage medium having stored therein a game program that when executed by a computer of an information processing apparatus, causes the computer to perform operations comprising:

based on a received direction input, determining an aiming direction in a virtual space; and

in a first mode,
causing a player character to launch, in the aiming direction, a catching item for catching the field character disposed on a field in the virtual space, based on an operation input, and when the catching item launched hits the field character, performing successful-catch determination relating to whether or not the catching is successful; and
when the result of the successful-catch determination is positive, setting the field character hit by the catching item in a player's possession, and

in a second mode,
causing the player character to launch, in the aiming direction, a fighting character, and causing the field character and the fighting character to start fighting against each other on the field.

Likewise, the first independent claim of US-App-4 currently recites:

1. A non-transitory computer-readable storage medium having stored therein a game program causing a computer of an information processing apparatus to provide execution comprising:

controlling a player character in a virtual space based on a first operation input;
in association with selecting, based on a selection operation, a boarding object that the player character can board and providing a boarding instruction, causing the player character to board the boarding object and bringing the player character into a state where the player character can move, wherein the boarding object is selected among a plurality of types of objects that the player character owns;

in association with providing a second operation input when the player character is in the air, causing the player character to board an air boarding object and bringing the player character into a state where the player character can move in the air; and

while the player character is aboard the air boarding object, moving the player character, aboard the air boarding object, in the air based on a third operation input.

On their face, it is exceedingly plausible that these claims were crafted to read on aspects of Palworld. For example, without diving into the intricacies of claim construction, claim 1 of US-App-3 certainly facially appears broad enough to cover the behavior of Pal Spheres within Palworld.

Given that these assets appear relevant to potential litigation, let's at least briefly consider how these two patent applications are progressing at the USPTO.

Importantly, US-App-3 received its first Office Action on July 19, 2024 and US-App-4 received its first Office Action on July 31, 2024. US-App-3 was rejected only for lacking subject matter eligibility (35 U.S.C. § 101), whereas US-App-4 was rejected by a different examiner for obviousness (35 U.S.C. § 103) (note that there was also a minor indefiniteness rejection under 35 U.S.C. § 112(b) for a dependent claim of US-App-4). Nintendo will now have the opportunity to amend their claims and/or argue against the rejections to try to get the patent applications across the finish line.

I think we are seeing just how seriously Nintendo views the threat of Palworld

In order to avoid losing accelerated Track One status, Nintendo needs to file responses to these Office Actions by October 19 and October 31, respectively. Hence, we will know very soon how Nintendo plans to address the examiners' rejections.

If (i) Nintendo's litigation proceeds reasonably successfully in Japan and no global settlement is reached and (ii) the claims in the patent applications above do not require substantial modification in order to arrive at allowance, Nintendo will undoubtedly have the opportunity to file a similar suit for patent infringement in the U.S.

These are, admittedly, two pretty substantial "ifs." Regardless, though, I think we are seeing just how seriously Nintendo views the threat of Palworld.

Obviously, the patent applications discussed above represent only two example assets of what could be an entire portfolio of actionable patents. Still, given their relevance to Palworld, I think it demonstrates that Nintendo and The Pokémon Company are serious when it comes to acquiring/asserting patents as an important component of their intellectual property arsenal.

In recent years, the video game industry has somewhat moved away from patents, especially for in-game features. If Nintendo is successful here, though, perhaps this paradigm could be in question.

Overall, the Palworld saga continues to move fast, and I'm very excited to monitor what happens next.

Andrew Velzen is an intellectual property expert and associate at law firm MBHB, who counsels and supports clients on IP matters related to a variety of technologies, including machine learning and artificial intelligence.