Can a video game company be held liable for placing virtual items on private property? The answer is – maybe. On February 14, 2019, the developer of the mobile game Pokémon Go, Niantic, reached a settlement agreement with class action plaintiffs who alleged that the game caused players to trespass and create nuisance on private properties.

For those unfamiliar with the game, Pokémon Go is an “augmented reality” game where the fictional game world is superimposed on the real world. Players move through the game world not by pressing buttons on a controller, but by physically moving in the real world. The game is centered around players finding and catching fictional creatures called Pokémon. In order to catch Pokémon, players must move close enough to the real-world location that the game has designated as that Pokémon’s location. Different types of Pokémon appear in different places and at different times of day and night. The game also designates certain real-world locations as Pokéstops, where players obtain in-game items, and Pokémon Gyms, where players battle each other. As such, for players to advance in the game, they must visit various real-world locations. However, the game did not restrict its game world to public spaces. It has placed Pokémon, Pokéstops, and Pokémon Gyms on or nearby private properties. The plaintiffs in the lawsuit alleged that the game “effectively transformed those properties into scavenger hunt grounds” and that the game “strongly encourage[ed] players to visit those locations—and to trespass if necessary to do so.”

The terms of the settlement agreement can be found here (pages 6-8). Essentially, Niantic has agreed to vamp up its online complaint system to provide private property owners with a means of removing Pokéstops and Pokémon Gyms within 40 meters of their property. Niantic promises to resolve complaints within 15 days for 95% of cases each year. In addition, Niantic will maintain a database of complaints in order to avoid placing future Pokéstops and Pokémon Gyms on single-family residential property. Niantic will also add new warnings to the game to remind players to be courteous to others and be respectful of their surroundings. Interestingly, the agreement does not mention adjusting Pokémon spawn points, so it is conceivable that Pokémon will continue to spawn on private property.

While the parties have reached an agreement, the settlement is still subject to approval by the judge, so everything is still tentative. If the settlement is approved, it is worth noting that it is proposed as a Rule 23(b)(2) class action settlement, and only injunctive or declaratory relief is available.[1] Members of the plaintiff class must file individual suits if they want money damages. To allow for this, the settlement agreement expressly reserves the right for plaintiffs to seek monetary relief, stating that the plaintiffs are only releasing their injunctive claims against Niantic. It remains to be seen, however, just how many plaintiffs will take up the opportunity to press their claims. In the settlement agreement, Niantic denied all charges of wrongdoing or liability arising out of the case. It also denied that the plaintiff class is entitled to any relief based on the conduct alleged. Any plaintiff who tries to file their individual suit must prove their case from scratch. Considering that the law over virtual trespass is untested in the courts, a plaintiff will likely face high legal fees accompanied by unknown payoff and chance for success.

On a related note, the settlement proposal also contains an agreement to mediate the unreleased claims of only the named plaintiffs. While this provides an avenue for the class representatives to get money damages, there is serious doubt as to whether this part of the agreement will be approved by the judge. As mentioned earlier, the judge must approve the settlement before it can take effect – he or she must evaluate whether the proposal meets the requirements as set out under Rule 23(e). Among other things, Rule 23(e) requires that the judge consider whether “the class representatives and class counsel adequately represented the class,” and whether “the proposal treats class members equitably relative to each other.” In this case, the class representatives are getting the chance to mediate their unreleased claims, but other class members are not. This is arguably not equitable treatment of the class members relative to each other. This also creates the concern that the settlement is reached not because it is a good deal for the entire class, but because it is a good deal for the class representatives, thus raising issues of fairness and adequate representation. It is likely for these concerns that the lawyers expressly made this part of the agreement severable from the rest of the agreement – if the judge finds this part of the agreement invalid, the rest of the agreement can be saved. If the suit is settled, it would leave the question open of whether one can be held liable for trespass for leaving virtual items on private property without the owner’s consent. The plaintiffs in this case argued that to succeed on their claim, they only need to prove that Niantic trespassed or did “something by way of encouragement, advice, or suggestion” that led Pokémon Go players to trespass. Helsel v. Morcom, 555 N.W.2d 852, 856 (Mich. Ct. App. 1996). Niantic argued that the plaintiffs not only need to show that it did something to encourage players to trespass, but that it also knew that its actions would lead to substantial certainty in trespass. Restatement (Second) of Torts § 158, cmt. i-j (1965). As evidence that it did not encourage players to trespass, Niantic points to its policies and warnings in-game which urged players to stay off private property. However, given that a large portion of the game’s player base is composed of children and teenagers, it is unclear whether policies and warnings are enough to achieve the intended effect. To err on the safe side, future developers of “augmented reality” games should carefully decide where they place their virtual assets and take care to avoid placing them in places that could encourage players to commit torts.

[1] The Supreme Court in Wal-Mart Stores, Inc. v. Dukes held that claims for monetary relief may not be certified under Rule 23(b)(2), at least when it is not incidental to the injunctive or declaratory relief. Wal-Mart Stores, Inc. v. Dukes, 564 U.S. 338, 360 (2011).

David Jiang is a JD candidate, 2020, at NYU School of Law.