Smaller Japanese studios are getting put through the wringer, recently.
It’s too early to say exactly which way the wind is blowing, but it sure feels like Nintendo’s opened a Pandora’s Box of patent lawsuits in Japan—for the uninitiated, Nintendo took a public swing at Palworld after a few months of relative silence, filing a lawsuit in September. Now Sega’s following suit, attempting to claim similar damages from MementoMori, a 2022 gacha game that’s primarily mobile-focused, though it does have a client for PC as well.
As reported by Otaku Souken, the lawsuit alleges that a set of five patents have been infringed—which are, as you might guess, primarily related to fairly innocuous gacha mechanics. I’m unable to get into the core specifics myself—patent language is obnoxiously specific and roundabout at the best of times, but there’s also a language barrier going on here in terms of translation.
However, Japanese game industry consultant Serkan Toto took to X to analyse the changes yesterday, and noted that one of them—5930111, which “solves the conflicting psychological problems” when using rare items—essentially translates to “a specific system for fusing character cards of the same kind more easily”. Another, 6402953 appears to describe a specific gacha system for character pulls.
As Otaku Souken points out, MementoMori was a big success for developer and publisher Bank of Innovation, making up 90% of the company’s recent sales. The report states that both companies were in talks with each other about the dispute, but were “unable to reach an agreement”. Unsurprisingly, Bank of Innovation disputes Sega’s claims, and states it’ll keep running the game if possible. Toto also goes on to report that the studio’s stock price dropped a sharp 17% as a result of the news.
As broken down by IP attorney Kirk Sigmon, who PC Gamer spoke to in the fallout of Nintendo’s lawsuit, filings like this have to be hyper-specific, and prove that every single word within the patent has been in some way infringed upon by the developer in question—which is a risky move in itself:
“If Nintendo’s asserted one of these patents and they’ve gone overly broad, they may have exposed themselves to Palworld finding proof that these concepts are not new … They’ve exposed themselves in a big way.”
Sega seems to be going even more shotgun with this legislation, making five different patent claims, rather than what appears to be just two from Nintendo (based on the ones it’s moved to file in the US). Meaning, logically speaking, it’s got more to prove. I’m scratching my head to figure out the actual reasonings behind this one, though.
Palworld is—and I’m not saying I agree with this thinking—a sort of direct challenge to Nintendo, a clear and satirical ribbing of the Pokémon games. If anything, it’s more of a shock that the famously litigious company took so long circling before going in for the kill. Has there really been that much beef between Sega (which does have mobile games) and MementoMori in the past? The damages sought, which total to ¥1 billion (around $6.6 million), are barely a drop in the ocean of the SegaSammy company’s operating income, which was ¥56.8 billion (around $376 million) this year.
This isn’t the case for Bank of Innovation, who stand to lose a lot more from the suit—and no matter what your opinion on gacha games is (mine’s pretty withering, in all honesty) it’s hard to see this as anything other than another company wading into a market that should be producing a lot of innovation and making efforts to put the clamps on smaller studios. Mechanic patents are a bit of a blight on this industry—they’re why the kickass nemesis system from the Mordor games never saw further use, and I’m keen to see the back of them.
To see even more of this nonsense just kinda weakens the spirit, especially as part of a trend that might see smaller Japanese studios afraid to cook, especially since Toto portends a similar doom: “Sega’s lawsuit following Nintendo’s legal action against Palworld owner Pocket Pair might also signal a new trend in big Japanese studios looking for damages from smaller ones that surprisingly launch hit games.” We can only cross our fingers that hope’s at the bottom of that box, somewhere.
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