Second Life TOS: A Partial Analysis and How to Protect your Digital Content

In November 2003, Linden announced that it would recognize participants’ full intellectual property protection for the digital content they created or otherwise owned in Second Life. As a result, Second Life avatars could from that point forward buy, own, and sell virtual goods ranging “from cars to homes to slot machines.”

The 2007 Bragg v Linden Research is about virtual property maintained on a virtual world on the Internet. Plaintiff, March Bragg, Esq., claimed an ownership interest in virtual property. Bragg contended that Linden, the operators of the virtual world, unlawfully confiscated his virtual property and denied him access to their virtual world. Ultimately at issue in this case are the novel questions of what rights and obligations grow out of the relationship between the owner and creator of a virtual world and its resident-customers. Bragg v. Linden Research, Inc., 487 F.Supp.2d 593 (E.D. Pa., 2007)

The Court in this case found that Linden’s TOS is a contract of adhesion and specifically found that the arbitration clause found therein was unconscionable and unenforceable.

In Evans v. Linden Research, Inc. (N.D. Cal., 2012) “The central dispute in this lawsuit is the meaning of “ownership” within Second Life. As discussed in more detail below, Plaintiffs contend that Linden and Defendant Philip Rosedale, Linden’s founder, former CEO, and current board member, represented to Second Life participants that they would have an actual ownership interest in the virtual land and items in Second Life’s virtual world. By contrast, Defendants argue that when they represented that participants would have “ownership” rights, they meant that Second Life users would own a copyright of their creations.”

Sometime after 2007 and the Bragg case Linden removed the word “owned” from the statement on its homepage, so that it became: “SECOND LIFE IS AN ONLINE, 3D VIRTUAL WORLD, IMAGINED AND CREATED BY ITS RESIDENTS.”

In March 2010, Linden modified its Terms of Service to state for the first time that “[v]irtual land is in-world space that we license.”

Linden representative, Mr. Page stated therein:

Linden has always from day one unchanged [sic] and they made no allegation that we have changed the rules, have told people that when you create content in Linden – in Second Life, unlike in other games, you own the intellectual property.

We have never interfered with anyone’s copyrights. That’s all you can own in a work of expression, right?

The copy that you put on Linden’s server is Linden’s, and it’s always been very clear. The copy that you have in your own computer, if you put a copy in your own computer, when we close your account, we haven’t taken away that copy and we haven’t taken away your copyright.

What you owned you still own. If you owned the copyright, you still do. Nothing – there is no allegation that any cognizable property right has been taken away from anyone as a – as a result. The property right here is a copyright and it is never taken away.

Our right to remove the bits from our servers of a copy that you licensed to us, is not a property right that the plaintiff ever owned. There’s no coherent allegation that there is any such property right. It is not real property. It’s not personal property; it is an intellectual property.

This is Linden specifically stating that if you remove your material from SL that it will no longer be available to Linden and that you, the user own the copyright to what ever you create.

The case was partially allowed to move forward for Subclass A, which was defined as: All persons whose assets, including virtual items, virtual land, and/or currency in lindens and/or U.S. dollars, have been deliberately and intentionally converted by Defendant Linden’s suspension or closure of their Second Life accounts.

In mid-August of 2013 Linden again changed the TOS.

The relevant portions of the TOS are reproduced below with highlights and the full TOS may be found at (http://lindenlab.com/tos):

2.3 You grant Linden Lab certain licenses to your User Content.

You retain any and all Intellectual Property Rights you already hold under applicable law in Content you upload, publish, and submit to or through the Servers, Websites, and other areas of the Service, subject to the rights, licenses, and other terms of this Agreement, including any underlying rights of other users or Linden Lab in Content that you may use or modify.

Except as prohibited by law, you hereby waive, and you agree to waive, any moral rights (including attribution and integrity) that you may have in any User Content, even if it is altered or changed in a manner not agreeable to you. To the extent not waivable, you irrevocably agree not to exercise such rights (if any) in a manner that interferes with any exercise of the granted rights. You understand that you will not receive any fees, sums, consideration or remuneration for any of the rights granted in this Section.

Except as otherwise described in any Additional Terms (such as a contests official rules) which will govern the submission of your User Content, you hereby grant to Linden Lab, and you agree to grant to Linden Lab, the non-exclusive, unrestricted, unconditional, unlimited, worldwide, irrevocable, perpetual, and cost-free right and license to use, copy, record, distribute, reproduce, disclose, sell, re-sell, sublicense (through multiple levels), modify, display, publicly perform, transmit, publish, broadcast, translate, make derivative works of, and otherwise exploit in any manner whatsoever, all or any portion of your User Content (and derivative works thereof), for any purpose whatsoever in all formats, on or through any media, software, formula, or medium now known or hereafter developed, and with any technology or devices now known or hereafter developed, and to advertise, market, and promote the same. You agree that the license includes the right to copy, analyze and use any of your Content as Linden Lab may deem necessary or desirable for purposes of debugging, testing, or providing support or development services in connection with the Service and future improvements to the Service. The license granted in this Section 2.3 is referred to as the “Service Content License.

Linden Lab has no obligation to monitor or enforce your intellectual property rights to your User Content, but you grant us the right to protect and enforce our rights to your User Content, including by bringing and controlling actions in your name and on your behalf (at Linden Labs cost and expense, to which you hereby consent and irrevocably appoint Linden Lab as your attorney-in-fact, with the power of substitution and delegation, which appointment is coupled with an interest).

2.5 You also grant Linden Lab and other users of the Service a license to use in snapshots and machinima your Content that is displayed In-World in publicly accessible areas of the Service.

You agree that by uploading, publishing, or submitting any Content to or through the Servers for display In-World in any publicly accessible area of the Service, you hereby grant other users a non-exclusive, worldwide, royalty-free, sublicenseable and transferable license to photograph, capture an image of, film, and record a video of the Content, and to use, reproduce, distribute, prepare derivative works of, display, and perform the resulting photograph, image, film, or video in any current or future media as provided in and subject to the restrictions and requirements of our Snapshot and Machinima Policy. The foregoing license is referred to as the “Snapshot and Machinima Content License.”

2.6 You may delete copies of your Content from the Service, and the licenses you have granted for the deleted copies will terminate with certain limitations.

Where permitted, you may delete copies or instances of your Contentthat you have displayed In-World or that are in your Account inventory through the normal functionality of the Service, including by emptying the trash folder in your Account inventory (such as in Second Life). In such event, the licenses granted by you in this Section 2 shall terminate in the manner provided below, but only for those particular copies or instances of Content that you have deleted from the Service.

You acknowledge that this termination will not apply to any other copies or instances of the same Content that you have not specifically deleted from the Service, including without limitation those that may be displayed elsewhere In-World and those that may be in the Account inventories of other users to whom you transferred copies.

You acknowledge that the Snapshot and Machinima Content License granted to Linden Lab and other users with respect to your Content will survive any such termination.

You also acknowledge that the Service Content License granted to Linden Lab with respect to your Content will survive any such termination solely as follows to permit Linden Lab: (i) to retain server copies of particular instances of your Content, including copies stored in connection with back-up, debugging, and testing procedures; and (ii) to enable the exercise of the licenses granted in this Section 2 for any other copies or instances of the same Content that you have not specifically deleted from the Service, including those that may be displayed elsewhere In-World or exist in other users’ Account inventories.

Here’s the highlighted sections put together so they are more easily understood:

You retain any and all Intellectual Property Rights you already hold . . . subject to the rights, licenses, and other terms of this Agreement. . .You hereby waive, and you agree to waive, any moral rights [but] . . . you will not receive any fees, sums, consideration or remuneration for any of the rights granted in this Section. [Y]ou hereby grant to Linden Lab, . . the non-exclusive, unrestricted, unconditional, unlimited, worldwide, irrevocable, perpetual, and cost-free right and license to use, copy, record, distribute, reproduce, disclose, sell, re-sell, sublicense (through multiple levels), modify, display, publicly perform, transmit, publish, broadcast, translate, make derivative works of, and otherwise exploit in any manner whatsoever, all or any portion of your User Content (and derivative works thereof), for any purpose whatsoever . . . “Service Content License.” . . .[Y]ou grant us the right to protect and enforce our rights to your User Content, including by bringing and controlling actions in your name and on your behalf . . . appoint Linden Lab as your attorney-in-fact. . . . You also grant Linden Lab and other users of the Service a license to use in snapshots and machinima your Content that is displayed In-World in publicly accessible areas of the Service. . . . You may delete copies of your Content from the Service, and the licenses you have granted for the deleted copies will terminate with certain limitations. Where permitted, you may delete copies or instances of your Content . . . Snapshot and Machinima Content License granted to Linden Lab and other users with respect to your Content will survive any such termination . . . the Service Content License granted to Linden Lab with respect to your Content will survive any such termination . . . To enable the exercise of the licenses granted in this Section 2

As you can see the terms are somewhat contradictory. They (“Linden”) say a user (“you” or “user”) keeps anything they own but this agreement modifies those rights.

Then they say you waive any moral rights. Moral rights are a guarantee to authors of so-called fine arts and exhibition photographs the right to claim or disclaim authorship in a work; limited rights to prevent distortion, mutilation, or modification of a work; and the right, under some circumstances, to prevent destruction of a work that is incorporated into a building. Waiver of moral rights in this way used to work, but in 1990 Congress limited the ability to waive moral rights by requiring a signed, written agreement specifying the work and the precise uses to which a waiver applies. It should also be noted that moral rights are also protected indirectly by state tort, privacy and publicity laws; by the federal protection of the Lanham Act; and by the Copyright Act’s protection of an author’s exclusive rights in his or her derivative works, and limits on a mechanical licensee’s rights to arrange an author’s musical composition.

Then they say you are not going to receive any consideration. Without consideration I would argue that any transfer is void as a contract as all contracts require an offer, acceptance and consideration.

Then they say you grant them a non-exclusive right to your work to do what ever you like with it. Again, no consideration and this contradicts you’re keeping what you own. It also contradicts what Mr. Page said in the 2010 Bragg case where he said that once a user deleted their content Linden would not use it any more.

Then they say that you make Linden their attorney in fact to file suit against others for using your work. Well this one is just kooky. As a non-exclusive licensee they can’t have the right to sue so they are attempting to obtain the right to, assumedly for the infringement of the derivative works they create. My first thought is that even if they create a derivative work, that since you, the original creator has not assigned your rights to said derivative work that they can’t have standing to sue. But lets assume they do and relying on the attorney in fact statement they file suit against some third party on your behalf. So here’s the rule pertaining to a power of attorney’s sufficiency (I’m using California law since that’s what their TOS chooses as choice of law):

4121. A power of attorney is legally sufficient if all of the following requirements are satisfied:

(a) The power of attorney contains the date of its execution.

(b) The power of attorney is signed either (1) by the principal or (2) in the principal’s name by another adult in the principal’s presence and at the principal’s direction.

(c) The power of attorney is either (1) acknowledged before a notary public or (2) signed by at least two witnesses who satisfy the requirements of Section 4122.

Since this is a TOS we’re missing the (a) date of execution (I guess they could argue that the date was when you clicked ‘I agree’), (b) a signature, and (c) acknowledgment or notary.

We could continue in this vain line by line, but I think it is pretty clear that most of the elements of the TOS that I’ve pulled out would not survive a court challenge. The courts have already ruled that the TOS is a contract of adhesion.

Accordingly, if you want to protect your rights to the work you create and put into Second Life or on any third party grid, file for your copyright before you publish the work (put it on the grid) and keep copies of your process of creating the work. If you have to sue then get a competent attorney and assert your copyright(s). Remember, the more copyrights you have the bigger hammer you have, so file often for as many renditions of the work as you can afford.

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