Stephen S. Wu-- SL: Legal Writer,, (408) 573-5737, 50 W. San Fernando St., Ste. 750, San Jose, CA 95113

New Lawsuit Seeks to Vindicate Virtual Property Rights

Jason Archinaco, the lawyer who represented Marc Bragg against Linden Research, filed another lawsuit against Linden in Philadelphia’s federal district court on April 15, 2010. The gist of the suit is that Linden represented to Second Life users that they owned the virtual land and goods they are creating and purchasing on Second Life, while at the same time are trying to deny ownership rights. This lawsuit has the possibility of placing virtual property rights, or lack thereof, front and center before the court. The case is entitled Evans v. Linden Research, Inc. and a copy of the complaint is linked here.
According to the Complaint, Plaintiff Carl Evans, Plaintiffs Donald and Valerie Spencer, and Plaintiff Cindy Carter were all users of Second Life. Evans and the Spencers allegedly purchased virtual goods on Second Life and thought they owned these goods. The Complaint says that Carter owned virtual land in Second Life, as well as other items. The Complaint then says that the Lindens terminated the Plaintiffs’ access to their virtual goods and land and did not compensate them for such property.

Plaintiffs identify one possible motive for allegedly stripping ownership from users - an initial public offering or sale of the company in which Linden will need to show purchasers that Linden owns all right, title, and interest in its virtual world once it builds up a critical mass of users. It is building up membership by promising ownership of virtual property. Nonetheless, Plaintiffs claim that Linden has no intention of fulfilling that promise.

The Complaint contains class action allegations, and it alleges claims for violations of California consumer protection laws, fraud, conversion, intentional interference with contractual relations, unjust enrichment, and wrongful expulsion from a private association. The conversion claim, in particular, will require the court to face the claim that Plaintiffs have property rights to their virtual goods and land under the law.

Linden has not yet responded to the Complaint. It will be interesting to see whether Linden denies that users have property rights, acknowledge that users have full property rights, or attempt to stake out a nuanced middle ground, in which users have some rights but not enough to trigger claims against Linden. In any case, the Complaint states expressly that it is a follow-up to the Bragg v. Linden Research case, and so may end up settling issues left unresolved in Bragg.