Nintendo Gets Huge Settlement Against ROM Site Probably Just To Scare Other ROM Sites

from the make-believe dept

A couple of years ago, we first discussed how Nintendo, long-time maximalists on intellectual property concerns, decided to open up a new front against ROM sites. What at first looked like it might be something of a surgical strike mission-creeped this past summer into a full war on ROM sites generally, with Nintendo using a buckshot lawsuit approach. Many sites simply voluntarily shut down, sweeping away decades of video game history to be once again locked up by Nintendo, while others stared down the company’s legal guns. All this, of course, as Nintendo was showing how silly this all is given the insane performance of its Nintendo retro consoles.

Well, it looks like the output of this effort is going to be Nintendo playing games with at least one of these suits, getting a settlement that nobody thinks it’s actually going to pursue in full just to have a multi-million dollar number to threaten other sites with. The husband and wife operators of have agreed to a $12 million settlement they can’t pay, and likely won’t have to, to have Nintendo call off its dogs.

Today we can report that both sides have indeed reached a deal. They agreed to a consent judgment and a permanent injunction that will resolve all outstanding disputes. Paperwork obtained by TorrentFreak shows that Mathias and his wife admit that their involvement with the websites constituted direct and indirect copyright and trademark infringement, which caused Nintendo irreparable injury.

However, on paper, the married couple won’t be getting off cheaply. On the contrary, they actually agreed to a judgment that exceeds $12 million.

“Plaintiff is hereby awarded judgment against all Defendants, jointly and severally, in the amount of $12,230,000,” the proposed language reads.

To be clear, nobody is saying the settlement is invalid or anything like that. In this case, the couple has admitted to infringing Nintendo’s copyright rights, has agreed to hand over any emulators and ROMs it has, and has agreed to the amount in question. On paper at least. But that agreement likely comes with the understanding that after this is all inked with signatures and the blessing of the court, a separate deal will be worked out for the payment of an entirely different amount.

We can only speculate but it’s possible that Nintendo negotiated such a high number, on paper, to act as a deterrent for other site operators. In practice, the defendants could end up paying much less.

It wouldn’t be the first time that a judgment in court is more than what the parties agreed to privately. This happened before in the MPAA’s lawsuit against Hotfile, where a $80 million judgment in court translated to $4 million behind the scenes settlement.

In other words, Nintendo pushed for a settlement amount it wouldn’t have gotten at trial not as an act of justice, but to use as a bludgeon against other ROM sites. It will be used either as a way to force voluntary shutdown of those sites, or as a template for settlement demands in the future. Either way, it makes a game out of the legal system, rather than trying to get to a just result.

And it has to be pointed out again that this is all happening as Nintendo competes with these sites perfectly well with its very cool retro consoles. Because control is what matters.

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Companies: nintendo

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Comments on “Nintendo Gets Huge Settlement Against ROM Site Probably Just To Scare Other ROM Sites”

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ShadowNinja (profile) says:

Re: Re: Re:

And the platform is literally there for free already, with improvements over the old system, like pausing and save states.

But we can’t have that because there’s no DRM to stop people from making copies of it!

It would be like chefs refusing to sell cook books with their recipes because gasp people could grab a pen and paper and make illegal copies of the recipes without paying the chef!

Stephen T. Stone (profile) says:

Re: Re: Re:

Why can’t they just sell their old games for $5 to $10 each

Because no one in their right mind would pay $5 for a digital copy of an NES game. And even if the market considered that a fair price, Nintendo could only ever sell games for which it owns the copyrights/trademarks or games it could license with ease. Finagling the rights to a game like Batman (bless you, Sunsoft) would take more money than Nintendo could ever hope to make back through sales—and then some.

Some of the best games (and a lot of the worst games) on the NES were licensed games—Tecmo Super Bowl and Total Recall, for example. Getting the rights issues cleared up would be a nightmare. ROM preservation is the only way many of those games will ever exist outside of thirty-year-old cartridges that may or may not work nowadays. I ain’t sayin’ Nintendo doesn’t care about preserving its library of games and its history for future generations…but I ain’t sayin’ it cares enough to preserve all of it.

Rekrul says:

Re: Re: Re:2 Re:

That’s been the going rate on Virtual Console since 2006. Perhaps the people paying that rate aren’t in their right minds, but it would seem that they exist.

It is my firm belief that the people who "buy" VC games are those who wouldn’t have the first clue how to get and use an emulator. I know several average computer owners who wouldn’t be able to figure out how to extract a Zip file if their life depended on it. To them, setting up an emulator and adding games to it would be the equivalent of asking them to build a nuclear reactor or perform brain surgery.

Rekrul says:

Re: Re: Re:4 Re:

OK, the majority of people…

I’ve put emulators and games on people’s computers and they struggle with the concept of save states or how to rebind controls. Yeah, you’d think these would be easy to understand since they’re really no different from a normal game, but they do. I once put a copy of Max Payne on someone’s system and a month later they said that they couldn’t figure out how to get out of the first level that I had showed them. They were playing the tutorial thinking it was the beginning of the full game and wondering why they couldn’t get past it…

Thad (profile) says:

Re: Re: Re:5 Re:

I’m sure the majority of people who buy VC games don’t know how to set up an emulator, but I’m sure the majority of people in general don’t know how to set up an emulator. I don’t think there’s any causal connection there.

There are valid reasons to choose official channels for emulation, even if you’re familiar with setting up emulators. Official emulators require less configuration, often have nicer interfaces, and are often more accurate than independent emulators. (This was certainly the case when the Wii debuted in 2006, before the rise of cycle-accurate 16-bit emulators. And as far as I know the TG16 and N64 still don’t have independently-developed emulators that are as good as the ones on the Wii.)

And some people would like to vote with their dollars. I’m never going to buy a legal copy of Earthbound on SNES. But if I’m going to play it on an emulator (or a flash cart), I think it’s only fair that I buy it in some form, like on the Wii U or the SNES Classic Mini.

Rekrul says:

Re: Re: Re:6 Re:

There are valid reasons to choose official channels for emulation, even if you’re familiar with setting up emulators. Official emulators require less configuration, often have nicer interfaces, and are often more accurate than independent emulators. (This was certainly the case when the Wii debuted in 2006, before the rise of cycle-accurate 16-bit emulators. And as far as I know the TG16 and N64 still don’t have independently-developed emulators that are as good as the ones on the Wii.)

Nicer interfaces maybe, but not more features. It’s my understanding that the VC only emulates a game’s original save options and that it has no save states, no graphics filters, no control remapping, etc. I’m not so sure about the accuracy either. I seem to recall that at least one C64 game was removed from the VC because bugs in the emulation prevented it from being completed. There are also comparison videos on YouTube showing the differences between the real consoles and the VC. Sometimes there are improvements, but often the VC fares worse.

For the TG16, I have no complaints about Magic Engine. It has a slick interface and I haven’t encountered any problems in any of the games I’ve tried, both Hu-Card and CD-ROM. Ootake is still being developed, although I hate the UI. I’m not sure about N64 emulation because I have an older system and the newest versions of the emulators won’t run on it. To be honest, I’ve only tried a few N64 games in an older version of Mupen+. I played a little of Star Wars Racer, Conker’s Bad Fur Day and of course Mario 64. All of them seemed to run fine. Then again, I don’t have much experience with the real console. I just know that I didn’t see any obvious problems.

I’ve also played about halfway through Goldeneye 007 using a modified copy of an emulator that gives the game full mouselook. There were a couple minor graphical glitches on a couple levels, but nothing that affected the game. Just wire fences not being rendered properly in front of other graphics like they should have been. I believe that’s been fixed in newer versions of the graphics plugin (which naturally don’t work on my older system). I can deal with an occasional glitch in return for the superior mouse control. Honestly, it makes Goldeneye and Perfect Dark control exactly like any computer FPS game. I only wish the same could be done for all the FPS games on the N64, but the author says it’s too time consuming to try and write special code to handle each game. Although there are control plugins that attempt to substitute the mouse for the analog stick.

I’ve used that method in a couple PS2 games. It worked fairly well, although my system isn’t fast enough to emulate the PS2 at full speed.

Thad (profile) says:

Re: Re:

Never say never, but I’m skeptical about Nintendo loosening its grip on how its games are packaged, distributed, and played.

While we are seeing a few original Nintendo games on non-Nintendo devices, we’ve yet to see any straight ports of existing games, or any Nintendo-licensed emulators on non-Nintendo hardware. I don’t think that’s likely to change any time soon.

Thad (profile) says:

Re: Re: Re: Re:

Nintendo views emulation as being on the same level of evil as eating babies.

Nintendo views emulation using third-party emulators as being on the same level of evil as eating babies. Nintendo is perfectly fine with emulation so long as it’s done using their emulators.

This distinction is important. Because when Nintendo representatives claim that the company is be opposed to emulation, they are lying. They are opposed to emulation they don’t control.

Virtual Console and the NES Classic use emulators. They’re emulators that Nintendo built in-house, but they’re emulators nonetheless.

Gary (profile) says:

Re: scared to ROM

This couple wasn’t downloading ROMs, they were maintaining a large collection of games and emulators. Curating, really since all that stuff is still easily downloadable from the Pirate Bay.
What we lost was a community of ROM enthusiasts that would help each other get these games running, and search for more old ROM carts to expand the historic database.

Thad (profile) says:

Re: Re: Re: scared to ROM

There are actually companies (including Sega and SNK) who distribute their old console ROMs legally and DRM-free. If you buy the Genesis Classics Collection on Steam, you can play those games in the official Sega emulator if you like — but it’s also entirely legal to play them in MAME or any other emulator, or copy them to a flash cart if you have one.

Rekrul says:

Re: scared to ROM

I’ve always been scared to ROM; afraid I’d get busted like this couple. Even torrenting with a VPN–if the government pressed hard enough on the VPN, they still get us.

Virtually nobody gets in trouble for downloading. People get in trouble for uploading, AKA "distributing" copyrighted material.

The reason you hear people say that someone got in trouble for "downloading" is that they used BitTorrent, which uploads as well as downloads. When you use BitTorrent, anyone connected to that torrent can see what you’re doing.

If you’re downloading ROM files from a web site, only three people/entities can see what you’re doing; You, the web site and your ISP. I assume you’re not going to turn yourself in, right? The web site is providing copyrighted material to you illegally, so they’re not going to turn you in. (unless it was a law enforcement "sting" site, but nobody dos that for video games, or even movies, only child porn) And it would be suicide for an ISP to start spying on users and turning them in for copyright infringement. So, the only three entities who can know you’re downloading ROMs from a web site aren’t going to turn you in for it.

Even if they did, the chances that you would get in trouble for downloading video game ROMs is pretty much zero. Firstly, it would be a PR nightmare for a company to go after someone for downloading games for personal use, but not distributing them. Second, I don’t think the statutory damages would apply like they do with BitTorrent, since they can’t claim that they don’t know how many infringing copies were made. They know exactly how many; One. They’d probably spend more on court costs than they could ever hope to get from you.

Lastly, look at all the videos on YouTube showing games being played in emulators. Nobody gets in trouble for that, even though they’re openly showing off that they’re using ROMs in an emulator.

Companies like Nintendo want to choke off the supply. Going after people who just download the games to play would make them look like monsters.

coward the howard says:

Re: Re:

^^^^ This.

I no longer will let nintendo near my home or kids; this action against a community that has been built on decades of hard work is shameful at best. They could have supported ROMs for decades but decided to ignore them and not even dip their toes in retro gaming, now they want to compete and the main reason they’ve been successful (on their terribly limited) console is because the rom community has been holding peoples attention for this long.

to the developers at nintendo, thank you for the memories. To the leadership at nintendo, you suck and I hope you know how much.

Anonymous Coward says:

Re: Re:


Nintendo can’t get a “worse” reputation among fans, for all their hot-to-trot lawyers, but people DON’T CARE as a general rule. People are hot to shell out every time they release a classic title remake on their newest console, and that’s what’s keeping them in business – a billion dollar business.

Just like the French: gamers are eager to pay for the rope companies will (legally) hang them with.

That One Guy (profile) says:

Legal theater

I can’t help but wonder what the judges involved in cases like this think about being used so blatantly, to see people(or more often companies) use their courts simply for PR purposes, in this case making public a threat of ‘Look what we did to them, we can do it to you too’ with bogus settlements that everyone involved knows aren’t going to be held to.

Bamboo Harvester (profile) says:

Re: Legal theater

This particular thing happens all the time, just for lower amounts and you rarely hear of it.

The $12m wasn’t actually Awarded by the Judge. In Civil cases, there’s a constant push from the Judge for the Parties to agree to a Settlement. Once they do agree on an amount, it gets put down on paper as this proposed settlement has been.

I’ve seen $10m “awards” like this levied against already destitute people. They agree just so they can stop being dragged into court over it. If they ever hit the lottery, they’ll be hit with all kinds of Demands.

They’re rather like filing a Mechanic’s Lien against a house where you’ve done work and not received payment. The house can’t be legally sold until that Lien is Released, by either payment of the past-due amount plus interest, or by the Lien Holder simply signing off on the debt.

This one was, as the bulk of the article says, a move to set a precedent of Award Amounts that can be used to bludgeon everyone else.

There will be another Agreement, made and signed in some lawyer’s office, where for $50 Nintendo will write off the $12m for Considerations. Which considerations will be a gag order on the entire transaction outside of the original $12m Judgement.

Mike Looper says:

Just because can't pay doesn't mean judgment invalid.

And when guilty as charged, it’s a good deal to just SAY the number rather than actually be liable for it. If they later inherited from mom and pop, got a great job, or even won a lottery, for instance, Nintendo could have claimed all but their subsistence.

Key principle of LAW, kids: it’s at discretion of the (as adjudged) aggrieved party to show mercy.

If can’t pay the judgment, don’t do the pirating.

If this CHILLS PIRATES, then it’s great.

And if this doesn’t show you the trend of how the real world when you use the content that others have made, that’s more fun for me. I’ve long since given up on any morality here. — Have ANY of you who pirated ROMs transferred money to Nintendo or copyright owner? There not abandoned works and you always claim would pay if could. No, you just plan on getting away with it, as these thieves did.

Congratulations Timmy on getting the 11 o’clock spot! YOU DA MAN! YOU are carrying the rest! Your focus on the exciting gaming area, is clearly the highest interest here.

But at least you tackled this one not favorable to pirates, though framing it as some injustice against the good honest pirates is still severely wrong.

Bamboo Harvester (profile) says:

Re: Just because can't pay doesn't mean judgment invalid.

No. They agreed to the $12m. They wouldn’t have been hit with an amount anywhere near that high if it had gone to trial.

Nintendo wouldn’t have gotten even close to that amount after trial. Their “mercy” was cutting a deal to accept on paper a $12m judgement.

They won’t get a fraction of that – as part of that deal.

Anonymous Coward says:

Re: Re:

If this CHILLS PIRATES, then it’s great.

It already hasn’t. Therefore it’s not.

This isn’t even nearly the first time it’s happened. IsoHunt was sacked with a $4 million judgement. Which the MPAA ordered. Which the MPAA explicitly admitted, during testimony, that they knew Gary Fung had no ability to pay. Yet they doubled down on their initial demand for $110 million and had that number thrown to the papers. This constant reliance on numbers nobody knows will ever be paid to copyright enforcement only serves to ensure nobody will ever believe your claims for damages.

Rekrul says:

Re: Just because can't pay doesn't mean judgment invalid.

And if this doesn’t show you the trend of how the real world when you use the content that others have made, that’s more fun for me. I’ve long since given up on any morality here. — Have ANY of you who pirated ROMs transferred money to Nintendo or copyright owner? There not abandoned works and you always claim would pay if could. No, you just plan on getting away with it, as these thieves did.

Nintendo: We’re discontinuing the NES. Buy the SNES.

People: But we still want to play NES games. What happens if it breaks?

Nintendo: Not our problem. BTW, we’re discontinuing the SNES, buy the N64.

People: So wait, now we need three different consoles to play our games?

Nintendo: Four. We’re discontinuing the N64, buy the Gamecube.

People: Why don’t you keep selling these older system?

Nintendo: Bah! There’s no profit in them! Also, we’re discontinuing the Gamecube, buy the Wii.

People: Why don’t you make your consoles backwards compatible?

Nintendo: OK, here’s the Virtual Console. You can now buy digital copies of about 2% of NES games. Note that the VC doesn’t provide any more functionality than the original system did. Oh, we’re also discontinuing the Wii. Buy the Wii-U.

People: Huh? But I have VC games I bought on the Wii!

Nintendo: Too bad. We’re discontinuing the Wii-U. Buy the Switch.

People: Screw this, I’ll get an emulator, have access to all the games and have tons more features than the original console!

Nintendo: THIEF! You’re stealing money from us!!!

People: By downloading copies of games that you no longer sell and that your hardware no longer supports?

Nintendo: YES! THIEF!!!

People: So why don’t you sell copies of your old games so people can use them on emulators?


People: Oh brother…

Rekrul says:

If it wasn’t for emulation and ROM sites keeping interest in older systems alive, all these “classic” consoles wouldn’t exist. There’s no way Nintendo would have just decided out of the blue to produce a plug & play system featuring 30 year old games if emulation hadn’t shown that people have an interest in playing those games. Not to mention that ideas now common on these system, like save states, were first introduced in emulators.

Nintendo had little interest in their old systems and games until they saw that people were using emulators to play them. Then they created the virtual console, and later the classic systems. But once they could use people’s nostalgia to their own benefit, they decided to stomp down on the emulation world and eliminate the competition.

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