10
Aug
2018

Bethesda blocks resale of used game

Many gamers sell their their used, physical games, often to supplement spending funds to buy more games. It’s such a big part of the gaming business that almost half of retailer GameStop’s profits come from selling used games.

But it looks like one publisher, Bethesda Softworks, may be seeking to rein in sales of used games online. Bethesda recently sent out a notice to at least one seller on Amazon’s Marketplace who was trying to sell a sealed copy of The Evil Within 2, demanding that they remove their listing. That letter included a phone number for sellers of Bethesda’s games to call, suggesting that the company is sending out such notices to multiple sellers.

Philadelphia-based Ryan Hupp recently contacted Polygon to explain how he’d been forced by Bethesda to stop selling his copy of The Evil Within 2. He bought the game but never unwrapped it, he told us. He’d been expecting to purchase a PlayStation 4, but instead spent his money upgrading a gaming PC. Hupp said he often sells used goods through Amazon Marketplace, which works in much the same way as other online trading sites, such as eBay.

Bethesda’s legal firm Vorys sent Hupp a letter, which he forwarded to Polygon, warning that the game must be taken down and threatening legal action for non-compliance. In its letter, Vorys made the argument that Hupp’s sale was not “by an authorized reseller,” and was therefore “unlawful.” Bethesda also took issue with Hupp’s use of the word “new” in selling the unwrapped game, claiming that this constituted “false advertising.”

Hupp complied with the demand, but in a reply to Vorys, he pointed out that the resale of used copyrighted goods — such as books, video games, DVDs — is protected in U.S. law through the First Sale Doctrine. This allows consumers to sell a used game, so long as it’s not significantly altered from its original form.

Bethesda’s letter claims that Hupp’s sale is not protected by the First Sale Doctrine, because he is not selling the game in its original form, which would include a warranty. The letter says this lack of warranty renders the game “materially different from genuine products” that are sold through official channels. In theory, this argument could be used against anyone who sells a used game without specific permission from Bethesda. If taken to its logical conclusion, Bethesda’s legal move could spell the end of users selling used games — or even brand-new unopened games — via online sites like eBay and Amazon Marketplace.

“Unless you remove all Bethesda products, from your storefront, stop selling any and all Bethesda products immediately and identify all sources of Bethesda products you are selling, we intend to file a lawsuit against you,” the letter reads. It goes on to state that a lawsuit would seek “disgorgement of profits, compensatory damages, attorneys’ fees and investigative and other costs.”

It’s also not clear why Hupp’s specific listing was targeted. Amazon still list dozens of used and new copies of The Evil Within 2 from Marketplace sellers.

When contacted by Polygon, Bethesda declined to comment on this story. We also asked for clarification on how the company’s warranties work on used goods sold through official channels. GameStop, for example, offers a blanket 30-day warranty on used games that do not work, so long as the game has not been broken by the buyers. Bethesda did not reply.

We also contacted Vorys for comment multiple times, but did not receive a reply. Amazon’s publicity department also did not respond to a request for comment.

On its website, Vorys offers advice for companies seeking to eliminate the sale of used products via places like eBay in an article titled, “Three-Step Approach to Stopping Unauthorized Online Sales on eBay.” Here’s an excerpt:

Under what is known as the First Sale Doctrine, once a trademark owner (“the company”) sells a product, the buyer ordinarily can resell the product without infringing the owner’s mark. However, the First Sale Doctrine does not apply when a reseller sells a trademarked good that is materially different from the company’s genuine goods.

Case law has established a few important principles relating to material differences. This includes that: 1) the threshold of materiality is considered “low”; 2) only a single material difference is necessary to give rise to a trademark infringement claim; and 3) material differences do not have to be “physical” differences.

This appears to be the basis of Bethesda’s legal claim against Hupp. Bethesda is a notoriously litigious company. It’s not clear how many similar letters have been out to people selling used games online, but Vorys’ voicemail message for Bethesda’s used games cases tells callers to leave details based on “the letter you have received” such as storefront name. It also thanks recipients of the letter if they have already ceased sales of Bethesda’s software.

“I understand the legal arguments Bethesda are relying on, and accept that they have some legitimate interest in determining how their products are sold at retail,” said Hupp in an email to Polygon, “but threatening individual customers with lawsuits for selling games they own is a massive overreach.”

If you’ve come across a game company seeking to stop you from selling a used game, please contact Polygon via our tips line.

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