Over the past couple months, Atari Interactive has filed lawsuits against RedBubble, TP Apparel, and Zazzle. All three defendants are online vendors who sell products with user-submitted graphic designs. Atari claims that all three websites have infringed Atari’s trademarks and copyrighted works by selling products, mainly t-shirts, featuring the Atari logo or art from their games. Atari is asking for preliminary and permanent injunctions enjoining the defendants from selling the allegedly infringing products, along with monetary damages.
RedBubble, TP Apparel, and Zazzle are online stores that allow for users to submit graphic designs for products such as t-shirts or cellphone cases. Atari’s complaints mainly focus on the t-shirts, but the websites allow for users to apply their designs to a variety of products. After a user submits a design, the site then manufactures the product with the graphic design and sells it on their website. The online vendor splits the revenue from the sale with the user who submitted the design. These types of sites provide an avenue for independent artist to earn money from their art. Nevertheless, a quick search of these websites reveals t-shirts featuring famous characters and brands, with some designs being more clever than others.
Atari is accusing all three defendants of direct infringement, contributory infringement, and vicarious liability. Even though users submit the allegedly infringing designs, the sites appear to be responsible for manufacturing and selling the products. To prove direct trademark infringement, Atari must show the defendants used their trademark in commerce in a way that causes consumer confusion. According to the Complaint, the sites have allegedly caused consumer confusion by making and selling unauthorized t-shirts featuring Atari’s logo. While for direct copyright infringement, Atari must show access and substantial similarity. It is highly likely the defendants had access because Atari published some of the most popular video games in the arcade era. The substantial similarity arguments will depend upon the graphic design at issue, but overall it appears that many of the allegedly infringing designs may be copies of visual aspects represented in Atari’s video games or marketing material.
The DMCA Safe Harbor provisions may complicate the copyright claims, but safe harbors do not extend to sites that receive a direct financial benefit from the alleged infringement. Splitting the revenue generated from allegedly infringing t-shirt sales would likely be considered a direct financial benefit.
These cases are still developing, and Atari may file more lawsuits against other online shirt vendors. It would not be surprising if other companies with popular brands or characters followed Atari’s lead, but they might also wait to see how this plays out before investing money in lawsuits of their own. We will provide updates to the Atari cases when available.