The Future of TRO in the Virtual World

In light of the ruling summarized previously, one can't help but ponder the effect of the virtual world. If Amaretto didn't sell virtual animals and products, would the court have granted an ex parte TRO? If Amaretto simply sold another more conventional product, which wasn't at risk of virtual death, would Amaretto have been successful in arguing a loss of good will and reputational harm? This case is a good example of how the concept of irreparable harm expands as technology progresses and becomes more sophisticated.

Irreparable harm: Advocating for your client

The Amaretto case further serves to demonstrate how lawyers should always critically analyze the facts of a case, as the lawyers in this case did, and also be sensitive to the concerns of our clients and relate their fears to the Court. Amaretto's Motion for a TRO stated:

If the company is not able to sell its products for even a short period of time, Plaintiff's virtual horses, sold to hundreds of customer users, will die if not fed. The virtual animated horses "virtual food" grow into different stages if they continue to eat the "virtual food," but will die within 72 hours if not fed the "virtual food". If Plaintiff is not able to sell virtual food to its customers, the horses die, and the customer is deprived of the product (the virtual horse) they purchased from the Plaintiff. Customers denied the ability to buy food for their virtual pets will no longer trust a company that cannot fulfill its obligations and therefore, will unlikely return to Plaintiff's business. (Plaintiffs' Memorandum of Points and Authorities in Support of Plaintiff's Ex Parte Application for Entry of Temporary Restraining Order, p. 10).

Amaretto's plea for the survival of its virtual animals inevitably bolstered the strength of its argument regarding loss of good will and reputational harm.

Virtual Death: A New Type of Irreparable Harm

In my Book ( I lay out various categories of what constitutes irreparable harm, which is paramount in demonstrating the need for injunctive relief. In Amaretto Ranch Breedables, LLC v. Ozimals, Inc. (case no. CV 10 5696, (N.D. Cal.)) the Plaintiff's allegations and arguments regarding its risk of irreparable harm were innovative.

Amaretto and Ozimals are in the business of creating and selling animated, virtual digital breedable animals and products, including virtual food, in their virtual stores. On December 1, 2010, Ozimals filed a take-down notice with Amaretto's internet provider under the Digital Millennium Copy Act ("DMCA"), in accordance with 17 USC 512, claiming that Amaretto's Horse Product Line infringes with and is a clone of Ozimals' virtual bunny.

Despite providing a Counter DMCA Notification, Amaretto feared that its service provider was about to take down its virtual animals and product line. Thus, Amaretto filed a Motion for an ex-parte TRO. Amaretto argued that it would be irreparably harmed if it was not able to sell its horse product line, especially during the Holiday Season, and that the Company's business and reputation would be destroyed. In particular, Amaretto argued that depriving its customers of products for even a short time would have disastrous results, as the virtual horses, which were sold to many customers, would die if not fed virtual food.

The Court granted the Motion and agreed that Amaretto would suffer a loss of goodwill and reputation harm if its products were taken down, especially during the prime buying season.

Our next posts will consider the implications of this ruling.