“Dungeons & Dragons” publisher Wizards of the Coast’s retraction of a proposal that would’ve significantly restricted its open gaming license demonstrates how companies must weigh the risk of public backlash when looking to tighten previously permissive intellectual property practices.
The maker of the popular tabletop role-playing game faced calls for boycotts last month after its draft licensing terms were leaked. The plan would have required fans and third-party content creators—such as the popular Dungeons & Dragons web series “Critical Role"—to register all paid uses of content based on Wizards’ IP and pay potentially pricey royalties, among other proposed changes.
Hasbro-owned Wizards ultimately made an about-face, abandoning the proposal and making the game’s core mechanics available through a Creative Commons license that will continue to allow free use by third-party creators.
The furor is an example of IP enforcement negatively reverberating back on its owner, attorneys said, with D&D’s backtracking serving as an indication that there are times where companies may be better served by relaxed IP licenses.
From a legal perspective, Wizards would have been well within its rights to implement the proposed restrictions, Aaron Swerdlow, an attorney at Weinberg Gonser Frost LLP, said.
From a business perspective, however, the company likely backed off after realizing “we might be cutting off our nose to spite our own face,” he said.
“In D&D terms, they have cast the spell ‘expeditious retreat,’” Mark Lemley, Stanford Law School professor and of counsel to Lex Lumina PLLC, said.
Failed Roll for Initiative
More than 50 million people worldwide have interacted with the game, according to Wizards. Several creators offer their own games, podcasts, and other media based on Dungeons & Dragons mechanics, some racking up millions of dollars in revenue.
For example, “Critical Role” started as a livestream of Dungeons & Dragons campaigns, and has since has been adapted into an Amazon.com animated series, “The Legend of Vox Machina.” The group has an audience of almost half a million people each week, according to the group’s website.
Following the leaked draft, third-party creators shared an open letter as part of the #OpenDnD campaign, referring to the proposal as “anti-competitive, monopolistic behavior” and saying it “chokes the vibrant community that has flourished under the original license.”
Creators also urged fans to cancel their subscriptions to “D&D Beyond,” described as an “official digital toolset and game companion,” which led to a crash on the website’s subscription management page.
“The backlash is notable in its ferocity,” Lemley said. “They have really angered their user base with an overbroad set of restrictions.”
Wizards didn’t respond to a request for comment. However, the game’s executive producer Kyle Brink wrotein a blog post last week that the new Creative Commons license is “open and irrevocable in a way that doesn’t require you to take our word for it.”
Kat Walsh, general counsel at Creative Commons, said that anyone using material under that license should be able to trust that they can continue using it under those terms indefinitely.
Noah Downs, a partner at Premack Rogers P.C. and a legal representative for OpenDnD, said the Creative Commons license preserves the current status quo. But as the game evolves, Wizards might put out new content under an entirely new open gaming license with additional restrictions and “creators may have to accept those terms,” he said.
Lisa Macklem, a business law lecturer at King’s University College in Canada, said Wizards may also choose to put certain aspects of their IP under exclusive licenses, such as for the creation of Dungeons & Dragons-related nonfungible tokens. NFTs, she said, are considered “a cash cow for the future.”
Apart from Wizards’ potential next steps, the effects of the uproar are still far-reaching and indicate a public need for expanding the open IP universe instead of restricting it, some attorneys say.
“They thought they could make more money, but I don’t think they took into account the chilling effect that it would have on this sort of ecosystem,” Shani Shisha, a doctoral candidate at Harvard Law, said of the publisher.
Shisha said Wizard’s consideration of tightened IP terms may force creators and fans to reconsider their involvement with the game and whether they would be able to shield spin-off creations.
“If you’re thinking about going into this business, or even continuing to operate in this community,” Shisha said, “you have to be concerned, because you don’t really know what the future holds.”
Fair Use, Enforceability
Shisha said it’s possible for third-party creators to protect themselves from any potential copyright infringement allegations from Wizards through the “fair use” doctrine or by testing the enforceability of the Dungeons & Dragons IP.
In some cases where creators are profiting from spin-off creations, their work could potentially be transformative enough to escape copyright liability; they would have to use the copyrighted works in a way that significantly varies from the originals.
More broadly, Shisha said Wizards may not have the IP enforcement power that it believes it has.
Concrete protection for the game “is actually a surprisingly complicated matter,” he said.
Give that the game’s characters are often closer to “stock” or generic characters without distinguishing features, he said Wizards may find it difficult to enforce its copyrights.
Creative Commons’ Walsh agreed there’s a “strong argument that a lot of the basic mechanics are not things that would qualify for copyright.”
“A lot of the more descriptive and creative material on top of it might, but it’s always hard to make a call on those questions without taking it before a court,” she said.
But whether fans and third-party creators would bring legal action is another issue.
“These are people who are obviously fans of the game and love the game so much that they’re creating their own intellectual property around it,” Swerdlow of Weinberg Gonser Frost said. “So you wouldn’t want to make an enemy of the very thing you care so much about.”
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