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Legal Eye: Scrabble-Facebook row spells trouble
Scrabulous application spat could set legal precedent...

By Simon Levine

Published: Tuesday 29 January 2008

Facebook's Scrabulous application has sparked a row between the social networking site and the owners of the Scrabble brand. It's a case with wide implications, says DLA Piper's Simon Levine.

Hard as it's been to escape the growing popularity of Facebook, news that the rights owners of Scrabble, Hasbro and Mattel, have asked for the removal of one of its most popular applications, has once again pushed the social networking site into the spotlight.

A letter to Facebook HQ from Hasbro and Mattel's lawyers has called for the removal of the application on the basis of an alleged breach of copyright.

The letter was a statement of intent from two companies keen to protect their intellectual property and once again highlighted the challenges that the digital sphere, and technology in general, presents to brands.

The monetisation of online communities and the creation of new advertising techniques throws up problems of its own.

Only a few weeks ago, Facebook CEO Mark Zuckerberg was forced to change the way the Beacon advertising system worked after receiving 50,000 complaints from users over releasing information about their internet activities without permission.

The facts

The Scrabulous application, created by Indian brothers Rajat and Jayant Agarwalla, has been credited with sparking a revival of the original Scrabble board game.

When Facebook invited developers to create applications to run on its platform, Scrabulous quickly gained cult status with 200,000 users in the first month alone.

Of the 600,000 people now playing on a daily basis, more than 46,000 have joined a Save Scrabulous group and that number is growing.

Scrabulous case: key issues

1. Application of copyright in the digital landscape.

2. Multi-jurisdictional implications.

3. Monetisation vs rights protection.

While the legal community was not surprised by the joint letter from rights holders Hasbro and Mattel last week, the rules of engagement online are different and, to some extent, yet to be defined.

Take into account also that Scrabulous is purported to make its Indian creators £13,000 a month and is one of Facebook's 10 most popular applications attracting users to the social network, it remains to be seen who will have their cake and eat it.

The law

The openness of social media, and social networks in particular, presents copyright and other IP challenges in an area that has a paucity of case law to draw on.

Technology and legislation have often been uneasy bedfellows and this latest Scrabulous spat may well set some legal parameters which govern how brands, consumers and social networks interact online going forward.

As well as highlighting the code-crunchers themselves, Hasbro and Mattel's move also calls into question the complicity of Facebook, which allowed the application onto its platform.

Of the plethora of applications there are a number of branded ones, such as TripAdvisor's 'Cities I've Visited'. So it would be surprising if the issue of brand association had not been raised before.

Another challenge for the legal community will be how multi-jurisdictional issues are played out with Facebook's servers located in the US and Scrabulous developers based in India.

Indeed the worldwide ubiquity of fans of the application may force Hasbro and Mattel to take a piecemeal approach to the rigorous policing of its rights if that's the route they want to go down.

The money

Consider this: perhaps this isn't a legal issue at all but more about marketability and monetisation. There's no doubting Scrabulous has engineered a mini resurgence of interest in the game if not the sales that Hasbro and Mattel are looking for. And that's the moot point isn't it?

Surely there's room for the rights holders and developers to come to a mutually beneficial agreement that acknowledges the Agarwalla brothers' work in creating a popular variation on an already available concept?

A meeting of all the parties has yet to be held. Indeed Mark Zuckerberg and the Facebookers are keeping decidedly tight-lipped on the whole affair.

When that meeting does take place, we're likely to see a landmark agreement that puts in place a new type of advertising agreement.

Time and again, the convergent worlds of online technology and marketing are keeping us lawyers on our toes. Like everyone else, we'll keep a watching brief on what comes out of the wash and no doubt refer back to this case in years to come.

Simon Levine is joint global head of the Technology, Media and Commercial Group at DLA Piper. DLA Piper is the world's largest global legal services organisation with more than 3,600 lawyers across 64 offices and 25 countries. Its award-winning technology, media and commercial practice employs 70 partners specialising in IT, telecomms, media, sport and IP law. Experts in convergence between the technology, communications and media sectors, it advises some of the world's leading multinational sport, media, technology and entertainment companies.