With the COVID-19 pandemic, the business of the video gaming industry has grown more than ever. The global videogame revenue was expected to surge 20% to $179.7 billion in 2020, which was bigger than the global movie and North American sports industries combined. The massive increase was due to the change in lifestyles in the pandemic leading to an increasing number of people longing for indoor games. Of the many gaming companies, Nintendo was able to reach 60% market share in console sales in 2020. With its new releases of Super Mario and Pokémon series, and with the steady sales of Animal Crossing, Nintendo Switch devices have been on the rise in its popularity. However, becoming such a big business in the industry and having been involved with video games since the late 1970s, Nintendo has a long legal history that goes hand-in-hand with their growth.
Nintendo faced legal difficulties with Gamevice after Nintendo began selling their popular Switch devices. On August 9, 2017, Gamevice sued Nintendo for violating a patent used in Wikipad – the company’s own gaming-oriented Android slate – and sought both damages and an injunction against Nintendo selling the Switch devices. Gamevice, Inc. v. Nintendo Co., No. 2:17-CV-05923 (C.D. Cal. Aug. 9, 2017). Gamevices’s patent “describes a product that combines a computing device and a game controller, which Gamevice said was similar to Nintendo’s popular hybrid gaming system.” Both the device from Nintendo and Gamevice are certainly not the first gaming tablets that were invented, but Gamevice seems to make an issue of the fact that Nintendo Switch’s Joy Cons were directly riffing on their idea of detachable controllers. However, Gamevice voluntary dismissed their case in October 2017, without any specific reasons why.
In March 2018, Gamevice returned with a patent lawsuit filed with the U.S. International Trade Commission under Section 337 of the Tariff Act of 1930. The ITC mentioned that it had begun an investigation into “certain portable gaming console systems with attachable handheld controllers and components” which meant that Nintendo could face obstacles to importing Nintendo Switch devices into the United States. However, in contrast to Gamevice’s hopes of receiving damages, the ITC, in its termination decision document in October 2019, affirmed the conclusion of the presiding administrative law judge’s (“ALJ”) initial determination (“ID”) that no violation of Section 337 has occurred. Certain Portable Gaming Console Systems With Attachable Handheld Controllers and Components Thereof; Notice of a Commission Determination Finding No Violation of Section 337, Inv. No. 337-TA-1111, USITC Pub. 22172 (Oct. 10, 2019). It was not until March 2020, when Nintendo ultimately won the patent dispute against Gamevice. As Law 360 stated, “Nintendo Co. Ltd. walked away victorious from consolidated inter partes reviews of a Gamevice Inc. mobile gaming patent, with the Patent Trial and Appeal Board invalidating all 19 claims Nintendo had challenged.” In that decision, the Patent Trial and the Appeal Board mentioned that “Gamevice didn’t have an adequate response to Nintendo’s argument that a skilled artisan would have been motivated to combine elements of two earlier patent applications to arrive at the claimed invention” and ruled that Nintendo Switch was different enough from Wikipad to avoid infringement. See Nintendo Co., LTD. v. Gamevice, INC., IPR2018-01522 (P.T.A.B. Mar. 10, 2020) However, Gamevice is still not giving up and is suing Nintendo again for patent infringement to halt the import of Switch into the U.S. and appealing the case that the ITC already decided. Gamevice petitioned the ITC for a new investigation into the Switch over patent infringement.
It seems unlikely that Gamevice will prevail with its new complaints, but if successful, it will once again threaten Nintendo’s imports of Switch devices into the U.S. market. Considering the fact that the ITC has actually decided to move forward with an evidentiary hearing regarding Gamevice’s requests, there are speculations of possible hurdles for Nintendo since the ITC decided to explore the matter a bit further. With the worldwide lockdown and change to indoor lifestyles due to the pandemic, demand for the Nintendo Switch is higher than ever and Gamevice’s lawsuit has angered many of the consumers longing for Nintendo’s games. Many have turned to social networking services to express their criticisms towards Gamevice and have initiated informal petitions to prevent Gamevice from suing Nintendo. While further legal decisions are still to come, it seems that Nintendo is safe for now in protecting their Nintendo Switch sales in the U.S. market, so new-coming users of the gaming device should reassure themselves.