Mid-Year Save Point: 2025 Games Litigation So Far
Believe it or not, we are already halfway through 2025. Since the start of the calendar year, numerous significant court decisions have come down, and many other lawsuits initiated, that will undoubtedly impact how we make and play games. In this article, we aim to provide a brief(ish) summary of some of the more significant cases and what they mean for developers, publishers, and players alike.
Note that as of this writing there are also several recent decisions from the United States Supreme Court—namely, a major First Amendment decision in Free Speech Coalition, Inc. v. Paxton—that we are not covering at this time.
Some Big Decisions
Video Game Addiction Cases Finally Get Some Clarity
Over the last couple of years, courts across the country have seen a slew of lawsuits filed by plaintiffs alleging that they or their children were addicted to video games. While the specifics of each of these cases may differ, the core claims are largely the same: a player allegedly becomes addicted to playing video games, spends too much time or money on said games, and is harmed as a result. Many of these suits have been brought by the same handful of plaintiffs’ firms and collectively target a wide range of video game developers and publishers, including Activision Blizzard, Epic Games, and Roblox.
In April of this year, the Northern District of Illinois was the first court to provide clarity—and a significant victory for video game studios—on this issue. In Angelilli v. Activision Blizzard, Inc., a mother filed suit on behalf of her minor child who allegedly played video games (mostly Roblox, despite the case caption) for 8-9 hours each day and suffered in school, lost friendships, and sustained emotional distress as a result. Asserting 19 causes of action, the plaintiff claimed that Roblox had addictive qualities, including its constant variety and social aspects.
The Court analyzed the claims under both the First Amendment and CDA § 230. Highlighting the United States Supreme Court’s landmark 2011 decision in Brown v. Entertainment Merchants Association and rejecting the plaintiff’s argument that it was Roblox’s conduct in designing the game rather than the game’s content that was allegedly tortious, the Court held that the First Amendment protects Roblox in providing their player avatar customization and game creation tools. And per CDA § 230, Roblox was not liable for providing these neutral tools that users exploit to create a constant array of new challenges and keep users returning to the platform. In other words, CDA § 230 immunizes platforms from claims premised on the socializing effects and impacts of speech by the platform’s users, and the First Amendment shields those platforms for their own expression.
The Court dismissed all claims with leave to amend, but the plaintiff voluntarily dismissed the case on May 15, 2025. While other addiction cases remain pending across the country, this holding could stem the tide of new complaints in other courts or be persuasive—if not binding—on those other pending cases.
An Epic Win for Epic Games
Epic Games has been engaged in a years-long litigation against Apple over the platform’s restrictive and anticompetitive in-app payment structure. In 2021, this culminated in a mixed decision from the Northern District of California, where the Court issued a permanent injunction whereby Apple could not prohibit developers from using in-app calls to action directing users to make purchases outside Apple’s in-app purchase system (where Apple charged a supracompetitive 30% commission on all in-app purchases) or communicating with customers through points of contact obtained voluntarily from those customers through in-app account registration. This injunction was upheld by the Ninth Circuit in 2023, and the United States Supreme Court denied cert shortly thereafter.
This was not the end of the saga, however, and in March 2024 Epic filed a Motion to Enforce Injunction with the District Court, claiming that Apple was willfully non-compliant with the Court’s order. Epic alleged that Apple had imposed new fees and restrictions for external links—up to a 27% fee for purchases made outside of the app—which when combined with the costs of implementing such payment options would render them a commercially unusable option. Epic also claimed that Apple imposed new requirements for permission to include external links in the first place; mandated specific language, look, and location for external links; presented “scare screens” to users before leaving the app to make purchases; and limited links to a single static URL leading to a general landing page rather than the specific products users were interested in buying. Apple also allegedly continued to prohibit steering using “buttons” or “other calls to action,” and prohibited entire categories of apps—including multiplatform apps—from using steering language altogether.
Concerned that the Court was not being given the full picture following hearings on Epic’s motion, Judge Gonzalez Rogers called for new discovery pertaining to Apple’s implementation of the injunction. What Apple was forced to turn over was damning, and demonstrated deliberate efforts by Apple executives at the highest levels to frustrate the injunction and repeatedly implement the most anticompetitive changes possible.
In a scathing order, Judge Gonzalez Rogers held Apple in civil contempt and imposed new restrictions on the company. Specifically, Apple can no longer impose any commission or fee on purchases made outside of the in-app ecosystem; cannot restrict or condition app developers’ style, language, or formatting of links for outside purchases; cannot prohibit or limit the use of buttons or other calls to action; cannot exclude certain categories of apps or developers from obtaining external link access; cannot interfere with customers’ choice to use external purchases with anything other than neutral language (i.e., no “scare screens”); and cannot restrict a developer’s use of dynamic links to bring customers to specific, rather than general, product pages. Furthermore, Judge Gonzalez Rogers referred the matter to the United States Attorney for the Northern District of California to investigate Apple for possible criminal contempt.
After nearly five years of litigation and following this order, Epic Games’ Fortnite finally returned to the App Store in May 2025. Combined with Epic’s previous jury trial victory against Google, this could signal the conclusion of the studio’s hard-fought campaign against the platform titans and open new—and safe—avenues of monetization for publishers to pursue.
Courts Begin to Stake Out the Bounds of Fair Use for Generative AI
The question of whether the training of a generative AI model on copyrighted material is a fair use or not has finally received some direction, but is not yet a fully settled question. When the facts are undisputed, the question of fair use may be analyzed and determined by a court, which applies four non-exclusive factors to decide whether a use was fair or not: (1) the purpose and character of the use, including whether it was commercial; (2) the nature of the copyrighted work; (3) the amount and substantiality of the work copied; and (4) the copying’s effect on the copyrighted work’s value or potential market. While courts weigh all factors, the first and fourth factors tend to be given the most significance.
In March, a Delaware federal court held that tech startup Ross Intelligence infringed on Thomson Reuters’ copyrighted material—specifically the legal research platform Westlaw’s key number system and case headnotes—to create a competing AI-powered research tool, and that this copying was not a fair use. Looking to the United States Supreme Court’s recent fair use decision in Warhol v. Goldsmith (which we discussed at length here), the Court determined that the purpose and character of Ross’ copying was to create a commercial competitor to Westlaw, causing the first factor to disfavor fair use. Additionally, the Court had little difficulty determining that Ross’ use was intended to directly compete with Westlaw or any potential AI-powered research tool developed by Thompson Reuters, tipping the fourth factor against a finding of fair use as well. While the second and third factors slightly favored Ross, it was not enough to overcome the heavily-weighted first and fourth factors.
The Delaware court specifically did not address whether training a generative AI model would otherwise be considered a fair use, but this issue would soon be addressed by two cases across the country in the Northern District of California.
First, in Bartz v. Anthropic PBC, the Court held that the defendant AI developer’s use of legally obtained copyrighted books to train large language models (LLMs) like Claude to produce new textual outputs was ultimately a fair use. Anthropic had assembled a centralized digital library of millions of copyrighted books—some purchased and scanned manually, others pirated from unlawful online repositories—to train their LLM on a vast collection of high-quality written material. Several authors whose books were included in this centralized library filed suit, alleging that the use of their works to train the LLMs infringed their rights, while Anthropic argued that any copying done to train their LLMs was a fair use.
The Court, Judge Alsup presiding, held that as to the first factor, the purpose and character of the use to create a LLM capable of generating entirely new text was “exceedingly transformative” and so strongly favored a finding of fair use. While the second factor slightly favored the authors, the third likewise favored a finding of fair use because for training purposes, copying the complete texts was reasonable. And finally, Judge Alsup found that for training a LLM there is no displacement for demand of the authors’ works, at least not in a way that matters under copyright law, because there were no exact copies or infringing knockoffs provided to the public. The Court ultimately held that the use of the non-pirated books to train an LLM was a fair use, but that there was no similar justification for Anthropic’s unlawful pirating and use of millions of other books.
Mere days later, in Kadrey v. Meta Platforms, Inc., the Northern District issued a second generative AI fair use decision. While the Court ultimately reached the same conclusion as Bartz, Judge Chhabria took issue with Judge Alsup’s “brushing aside concerns” regarding the important fourth fair use factor. In Kadrey, thirteen authors sued Meta for downloading their books from “shadow libraries” and using them to train LLMs, which Meta claimed was a fair use. The authors’ primary arguments against fair use—that the LLM could reproduce small snippets of text from the books and that using the works had diminished their ability to license the works for the purpose of training LLMs—were not persuasive to the Court.
As to the first three fair use factors, Judge Chhabria largely paralleled Judge Alsup’s logic, finding that the purpose and character of the use was “highly transformative,” that the highly expressive nature of the works favored the authors, and that the complete copying of the works was reasonable given the purpose. As for the fourth factor, the Court identified three potential arguments that a plaintiff could make: (1) the model will regurgitate their works, allowing users to access them for free via the model; (2) identify a market for licensing works for AI training and contend that unauthorized copying harms that market; or (3) even if the model can’t regurgitate the works, it can generate works that are similar enough in subject matter or genre that they compete with the originals on the marketplace and indirectly substitute for them. Because the authors only raised the first two arguments, which were not persuasive to the Court, Judge Chhabria was obligated to find the fourth factor in favor of fair use.
But Judge Chhabria’s order raises significant concerns about similar cases in the future. An outpouring of AI-generated works created by a LLM trained on copyrighted works could theoretically dilute the market for those original copyrighted works, creating indirect substitutions for them even if they are not direct copies. And even though Judge Chhabria held that Meta’s use was fair in this circumstance, he cautions that his ruling “does not stand for the proposition that Meta’s use of copyrighted materials to train its language models is lawful,” but rather “stands only for the proposition that these plaintiffs made the wrong arguments and failed to develop a record in support of the right one.”
In other words, it seems that the already-important fourth fair use factor may become determinative in future generative AI cases. Given the rapid development and incorporation of AI tools by developers and publishers and the fact-specific nature of fair use analysis, these issues are ripe for continued litigation. And for game developers using these tools, this signals the importance of good data controls both on what goes into any proprietary models, as well as what they spit out.
Other Cases of Note
As if these major cases weren’t enough, numerous other cases were either initiated or continue to be relevant in the video game space. While there is no way we can cover every case in detail (this article is long enough!), below are a few highlights in brief.
United States v. Cognosphere: On January 17, 2025, Genshin Impact publisher Cognosphere agreed to pay $20 million and block children under the age of 16 from making in-game purchases without parental consent in a settlement with the FTC. The FTC had alleged that the company violated the Children’s Online Privacy Protection Act (COPPA) and deceived children and other users about the real costs of in-game transactions via the use of dark patterns.
Schudde v. Dream Games Teknologi Anonim Sirketi: Plaintiffs in this Western District of Washington case claim that defendant publisher’s mobile game, Royal Match, constitutes illegal gambling under Washington state law and utilizes dark patterns to coerce players into making purchases they otherwise would not. Dream Games has fully briefed a motion to dismiss these claims largely on jurisdictional grounds, but there has been no ruling yet. A parallel case in the Central District of California, Vollmuth v. Dream Games, was stayed pending resolution of the Washington case.
Nintendo v. Pocketpair: In September 2024, Nintendo and The Pokémon Company sued Pocketpair, developer of Palworld, in Japanese court. Nintendo alleges that Pocketpair infringed three patents relating to gameplay mechanics and is currently seeking an injunction against Palworld and the payment of millions of yen in damages. In response to this lawsuit, in November 2024, Pocketpair removed the Pokéball-like “Pal Spheres” and related game mechanics from Palworld, and in May 2025 announced that they would be removing additional mechanics such as the ability to glide utilizing the in-game Pal characters. This litigation is ongoing.
Thaler v. Perlmutter: Dr. Stephen Thaler, creator of the generative AI program “Creativity Machine,” hit another roadblock in his attempts to register an image generated by the program with the Copyright Office. In 2022, the Copyright Office denied Dr. Thaler’s request register the work with Creativity Machine listed as the author, because it lacked the human authorship necessary to support such a claim (we discussed Creativity Machine along with some other relevant AI authorship issues in a previous blog post). Dr. Thaler took his claim to court, and in March 2025 the United States Court of Appeals for the District of Columbia affirmed that the Copyright Act does not protect works created entirely by AI and upheld the Copyright Office’s original finding that a work must “be authored in the first instance by a human being.”
Peary v. DC Comics, Inc.: Plaintiff Mark Peary is the nephew of Joseph Shuster, co-creator of Superman. Shuster died in 1992, and according to Peary, under the copyright laws of the United Kingdom, Canada, Ireland, and Australia, rights in the Superman character automatically reverted to Shuster’s estate in 2017. Following dismissal in federal court for lack of subject matter jurisdiction, Peary refiled in New York State Court seeking a preliminary injunction to prevent the release of James Gunn’s upcoming Superman movie in those territories. The court denied the injunction, finding that Peary’s delay in seeking relief and failure to show a likelihood of success weighed against granting the injunction. While Peary sought to block the release of a movie, it is not a stretch to envision a similar logic, using similar laws, used to try and prevent a game studio using licensed IP from publishing in those countries.
Epic Games v. Atas et al: Epic Games recently filed suit against Ediz Atas and several unnamed defendants in the Eastern District of North Carolina, asserting claims for trafficking of circumvention technology in violation of the DMCA, copyright infringement, and the fraudulent impersonation of Epic employees. The lawsuit targets the defendants’ alleged creation and distribution of Fortnite cheat software, which provides unfair advantages like auto-aim and wall-hacking capabilities and has resulted in over 15,000 player bans in the United States. Epic’s complaint was filed on June 10.
As 2025 proceeds into its second half, we will keep an eye on these and other cases as they are filed, fought, and finished, and will provide a similar end-of-year roundup in a few months. But in the meantime, here on the Games Law Blog we will continue to provide our thoughts and insights into more discrete—and hopefully entertaining!—topics.