Written by Alyce Evans. Researched by law graduate, Sophie Jones.
Or, as it’s commonly referred to “Pokémon with guns”, is the video game currently making global headlines. Not only did it sell a record breaking 5 million copies in just 3 days, but it’s also sparked a worldwide discussion about copyright and intellectual property.
The key questions: What is intellectual property? When is it infringed? Did Palworld copy Pokémon? And, importantly, can Pokémon do anything about it?
In this blog, we break down the key players and the legal issues involved in this global news story.
If a legal dispute does arise between Palworld and Pokémon, it’s unlikely to be litigated in Australia. However, for this article, we’ll explain how this battle would play out under Australian law.
What is Pokémon?
If the words Pikachu, Charmander, Bulbasaur and Jigglypuff are unfamiliar to you… welcome to the world of Pokémon.
Pokémon video games are published by Nintendo and The Pokémon Company.
First released in Japan in 1996, Pokémon is a role-playing game, where players (“Pokémon trainers”) search for monsters known as ‘Pokémon’. The aim is to catch Pokémon and then battle them against other Pokémon trainers.
Commercially, Pokémon is one of the most successful video game franchises in the world. Alongside the video games, there are Pokémon cards, board games toys, merchandise, clothing, TV shows, movies and more. In short, Pokémon is a global empire.
What is Palworld?
Palworld has been described as a “multiplayer monster-collecting game with open world survival elements“. Amongst the public, it has become known as “Pokémon with guns”.
Created by Japanese game developer, Pocketpair, Inc., Palworld was first announced back in 2021. However, in recent months, news of the game – and images of its colourful characters – entered the mainstream discourse.
For those familiar with Pokémon… it’s easy to see why.
Many of the Palworld monsters (known as “Pals”) bear a striking resemblance to Pokémon’s characters. However, we’ll come back to this.
In terms of commercial success, an early access mode of Palworld was released on 19 January 2024 and has dominated the gaming market.
In just three days, Palworld sold a record breaking 5 million copies. This is more than the fastest-selling PlayStation exclusive of all time. As of today (24 January 2024), it is currently the most played game on Steam.
In other words, the game is doing very well!
So what’s the issue? Well, let’s go back to that “Pokémon with guns” comment.
Why is Palworld being called “Pokémon with Guns”?
Critics have been quick to flag that many of Palworld’s Pals are very similar (visually) to Pokémon’s characters.
In terms of gameplay however, there are some key differences. Pokémon do not have guns, nor can they be butchered for meat, enslaved or armed for defence like the poor Pals can.
So where does that leave Palworld legally?
Did Palworld copy Pokémon and, if it did, is this a breach of intellectual property?
Legal issues: Did Palworld infringe Pokémon’s intellectual property?
With the release of Palworld, public discourse about whether or not Palworld copied Pokémon has surged into overdrive. The media, video game players, digital artists, and intellectual property lawyers are all weighing in with their opinions.
But, when does ‘copying’ become copyright infringement?
On this point, we note that each country has its own copyright legislation, and there are complexities regarding which country’s laws to apply in instances of infringement.
For the purposes of this article, we will consider this issue from an Australian legal perspective.
What is copyright infringement? (Australian law)
Under Australia’s Copyright Act 1968 (Cth) (AU Copyright Act), copyright infringement occurs when:
– There is an original work created by a human author.
– That is protected under copyright legislation and is not in the public domain.
– The rights in that work are exercised by someone other than the copyright owner, without the copyright owner’s permission or licence.
Copyright in Pokémon characters
Pokémon characters can be considered original ‘artistic works’ under Australian copyright legislation. They are not yet in the public domain and are therefore protected by copyright.
Rights in artistic works
Under the AU Copyright Act, the owner of copyright in an artistic work has the exclusive right to reproduce the work, publish the work and communicate the work to the public.
If anyone else does these things without the copyright owner’s permission or a licence, that can be copyright infringement.
Claims of copyright infringement
As noted above, Pokémon characters are artistic works protected by copyright.
Therefore, the owners of the copyright in Pokémon would need to identify each Palworld Pal that is an alleged copy of a Pokémon character.
They would then need to prove that the Pal reproduces the Pokémon character or a substantial part of the Pokémon character.
Lawyers across the world are divided on whether the Pals and Pokémon would be considered similar enough, such that Pokémon would succeed in a copyright infringement claim.
When it comes to copyright law, there can be a fine line between inspiration and imitation.
Additionally, 3D modellers have been weighing in to comment on the similarities between the two games’ 3D modelling. It is unclear how much weight this would have as evidence in a court case.
Could the defence of ‘parody’ protect Palworld?
Another question being raised is whether Palworld could raise the defence of parody and satire (if sued by Pokémon). As noted earlier, Pokémon generally do not have guns (Blastoise, we see you!).
What is the parody defence? (Australian law)
Under the AU Copyright Act, it is a defence to copyright infringement if the work is used in “fair dealing for the purpose of parody or satire”.
Australian courts have indicated that a parody must be:
– “A humorous or satirical imitation” of another work.
– Must itself be a new work and the product of mental labour.
– Must make some comment on the original work.
– Can rely on the audience’s awareness of the original work, however, this defence cannot merely be used as a shield to protect people who simply want to copy other people’s works.
What is “fair dealing”? (Australian law)
Additionally, the parody must be considered a “fair dealing” with the original work. Regarding the meaning of “fair dealing”, Australian courts will consider:
– The purpose and character of the dealing (e.g. whether it was a commercial or non-commercial use).
– The nature of the work used.
– The possibility of obtaining the original work within a reasonable time at an ordinary commercial price.
– The impact on the copyright owner.
– Where part of the work is reproduced, the amount and substantiality of the part copied (in relation to the whole).
Is Palworld a parody of Pokémon?
Palworld is a violent game where Pals have guns and players can butcher and enslave their Pals. In other words, it’s a far cry from the cute, colourful world of Pokémon.
However, it may be difficult to argue that it is a parody of Pokémon.
If we apply Australian tests, we note:
– Arguably, there are elements of Palworld which imitate Pokémon. However, the creators of Palworld have clearly expended mental labour to create a new game, with original gameplay and strategy. Tick for the parody defence.
– On the other hand, Palworld doesn’t appear to be a commentary on Pokémon. The similarities to Pokémon characters may be more of a strategic move to intrigue potential players, rather than a commentary on the global phenomenon that is Pokémon. Cross for the parody defence.
Finally, even if Palworld were considered a parody of Pokémon, it may have a hard time arguing that it is a “fair dealing” because:
– The dealing is arguably highly commercial.
– Pocketpair, Inc. have been developing Palworld since 2021 and could have asked Pokémon for permission to create similar characters.
On the flip side, Palworld may counter that there hasn’t been a negative impact on Pokémon (arguably, they were never going to make a Pokémon with guns type game!), and they haven’t used a substantial part of the Pokémon characters.
Ultimately, it’s hard to know how this defence would play out, but we’d be intrigued to hear the courts’ opinions.
Side note: If you’re interested in learning about how the parody and satire defence operates in other countries, check out our blog, ‘Celebrity Roasting: How does South Park get away with it?’.
What have Palworld and Pokémon said?
As of today’s date (24 January 2024), The Pokémon Company have not made any official public statements about Palworld.
However, speaking to Game File, Pokémon’s former Chief Legal Officer, Don McGowan has commented, “This looks like the usual ripoff nonsense that I would see a thousand times a year when I was Chief Legal Officer of Pokémon. I’m just surprised it got this far.”
The CEO of Pocketpair (creator of Palworld), Takuro Mizobe, has refuted the accusations of copying while speaking to Automation, stating, “We make our games very seriously, and we have absolutely no intention of infringing upon the intellectual property of other companies.”
Ultimately, we cannot rule one way or the other on this case. Additionally, if this case does go to courts, it will not be in Australia, so a different jurisdiction’s laws will be tested.
One thing is certain – if the owners of Pokémon do take action, we’ll be closely watching how it all plays out!
How about you? Will you be downloading Palworld?
Looking for more? Check out some of our other blogs about copyright:
Written by Alyce Evans. Researched by law graduate, Sophie Jones.
Published 24 January 2024.
Image from Palworld, Inc. shared for the purpose of reporting the news.
The information in this article is of a general nature. It does not constitute formal legal advice, and should not be relied on as such. Please see the full disclaimer in our website terms. Please contact Studio Legal if you are seeking advice about a specific legal matter.