ONLINE GAME HACKING AND HOW IP LAW CAN CURTAIL IT

JOURNEY INTO THE QUICKSANDS OF
INTELLECTUAL PROPERTY LAW:
FOCUS ON ONLINE GAME HACKING AND HOW IP LAW CAN CURTAIL IT
By
Thorsten Schauer

2
ABSTRACT
Since the advent of the internet, online gaming business have turned into a
multi- billion dollar industry. While it makes money for gaming companies,
abusive hackers has also cashed in by hacking into the gaming system and
selling in-game items for real money. This becomes a problem for said
companies given the fact that their profits are slashed due to these hackers
deed. To solve the problem, this paper proposes to present various criminal
and more especially intellectual property laws that online gaming companies
can use to bring these hackers to justice.

3
TABLE OF CONTENT
Page

Chapter 1. Introduction
................................................................................................................................
4

1.1
Scope
.....................................................................................................................................................
4

1.2
Background
.........................................................................................................................................
5

1.3
Aims of the Legal Article
..............................................................................................................
7

1.4
Problem Statements
......................................................................................................................
8

1.5
Methodology
.......................................................................................................................................
9

1.6
Legal article Structure
.................................................................................................................
12

Chapter 2. Literature review
.....................................................................................................
13

2.1
Introduction
.......................................................................................................................................
13

2.2
Cybercrime
........................................................................................................................................
14

2.3
Profile of a Hacker
........................................................................................................................
16

2.4
Online Gaming
................................................................................................................................
18

2.5
Online Game Hacking and Its Effects
.................................................................................
20

2.6
Criminal Hacking vs Ethical Hacking
...................................................................................
22

2.7
Pertinent Criminal Hacking Laws
..........................................................................................
26

2.8
Intellectual Property (IP)
............................................................................................................
30

2.9
Other Pertinent IP Laws
.............................................................................................................
36

2.10
Conclusion
......................................................................................................................................
47

Chapter 3. Methodology
.............................................................................................................
49

3.1
Introduction
.......................................................................................................................................
49

3.2
Participants and Sampling
........................................................................................................
50

3.3
Instrumentation
...............................................................................................................................
51

3.4
Procedure
..........................................................................................................................................
58

3.5
Validity and Reliability
.................................................................................................................
58

3.6
Limitations
.........................................................................................................................................
60

Chapter 4. Data Analysis
...........................................................................................................
60

Chapter 5. Discussion and Interpretation of Findings
.................................................
63

Chapter 6. Conclusions and Recommendations
...........................................................
64

6.1
Conclusions
......................................................................................................................................
64

6.2
Recommendations
........................................................................................................................
66

Bibliography
..................................................................................................................................................
68

Appendices
...................................................................................................................................................
73

4
Chapter 1. Introduction
1.1 Scope
This research will involve an in depth study on hacking in the realm of online
gaming. This is a problem currently faced by the industry where the
researcher belongs to as will be shown in this study, can best be solved using
the current laws, statutes, case law and other policies, particularly IP laws,
both national and international.
This legal article is highly feasible in terms of resources, primary and
secondary literature currently available online and in printed format. The
problem is not only current, but also prevalent. This is why relevant and
quality references are accessible. Applicable laws, statutes, case law,
directives and international legal rules and principles that may be related to
this topic, both online and offline references, are highly available and
accessible making this study and its objectives feasible. Some of the
references the researcher used are included in the bibliography portion.
In terms of scope, given that the topic may still be broad, the researcher
would be further delimiting it into the hacking of online game items and how
these hackers may be made answerable by existing laws. To further delimit
the scope, particular games that serve as actual examples of hacking
incidences and the details of the hacking are what will be discussed.
Comparative analysis of the different applicable laws will also be included.

5
1.2 Background
About four decades ago, hacking was not regarded to be a negative act but
an emotive term.1
In fact, it was used to describe people who are technically
gifted with the use of computers. However, this definition has changed in
recent time. Hackers are now viewed as individuals who use their adept
knowledge of computer technology to acquire illegal access either to corrupt
or steal information for personal gain.2
It is the latter definition that will be the
focus of this study and how it relates to online gaming.
Online games have become very popular especially with the dawn of internet
for home use. The proliferation of internet access has paved the way for the
million-dollar online game industry, more particularly for MMORPGs. This
Massively Multiplayer Online Role Playing Game genre provides players with
characters that they can take as their own but in a virtual world. The player
can then live the life of the character in the computerized environment and kill
enemies, save lives, construct edifices, protect property and engage in
commerce.3
The last mentioned activity occurs when players trade actual
money for virtual items such as weapons, powers, etc. This act has turned
controversial where some are supportive of it while others are strongly
opposed to it.4
It is this act that hackers chose to use in doing their illegal
activities.
1
D. Langford, Practical Computer Ethics (McGraw Hill Inc., London, 1995).
2
Ibid.
3
AD Schwarz & R Bullis, Rivalrous Consumption and the Boundaries of Copyright Law: Intellectual
Property Lessons from Online Games (Intellectual Property Law Bulletin, 2005).
4
V Lehdonvirta, Real-Money Trade of Virtual Assets: Ten Different User Perceptions (Proceedings of
Digital Arts & Culture, IT University of Copenhagen, Denmark, 2005), pp. 52-58. Retrieved from
http://ssrn.com/abstract=1351772.

6
A growing number of studies are carried out on MMORPG and the virtual
worlds where some scrutinise it on the premise of the economic theory5
while
others prefer to examine it according to the interaction between virtual and
real economies. This study will however take the path other scholars6
have
taken and trudge into the issues by applying the legal theory on virtual asset
trading with focus on the ownership of these assets.
When such a collision of reality and virtual fantasy occurs, it becomes
imperative that the appropriate law be applied, especially when the act has
turned criminal, such as what hackers do. This will be the starting point of the
journey that this research took. It passed through the different laws,
particularly intellectual property laws that can be applied in solving the
problem of online game hacking.
This journey will continue on to find out the current status of online games
and how hacking has adversely affected the business. It will then proceed to
identify the pertinent laws and statutes, focusing on IP and copyright laws that
can lead to the curtailment of online game hacking. It will likewise try to
evaluate the arguments presented not only by the gaming companies and
advocates of intellectual property but even the hackers themselves. This
study’s journey will end when it finally finds the legal strategies it can
prescribe to those affected by online game hackers in bringing them to
justice. Should there be a failure to find such legal means, then this paper will
5
E Castronova, Virtual Worlds: A First-Hand Account of Market and Society on the Cyberian Frontier
(CESifo WP Series #618, 2001). Retrieved from http://ssrn.com/abstract=294828; E Castronova, On
Virtual Economies (CESifo WP Series #752, 2002). Retrieved from http://ssrn.com/abstract=338500.
6
F Lastowka & D Hunter, The Laws of the Virtual Worlds (92 California Law Review 1, 2004).

7
recommend certain actions it may find suitable to achieve such goal.
1.3 Aims of the Legal Article
The main aim of my legal article is to explore strategies, which can be
adopted to curtail online game hacking through the adoption of laws and
legislations, particularly in the realm of intellectual property, including laws on
trademark, patents and copyright. The study will also prescribe the most
suitable laws that can be invoked against hackers to bring them to justice.
The study also seeks to fulfil four main objectives, besides what was
mentioned, namely;
1) To assess the impact of hacking on online gaming.
2) To explore various arguments posited by hackers as to how and why
they do what they do.
3) To explore available legal liabilities and remedies, including those
relating to intellectual property and copyright law.
4) To prescribe the best legal means by which online game hacking can
be curtailed.
Given the objectives above, the research seeks to answer the following
question: “What is the impact of hacking on online gaming businesses and
what are the existing legal remedies, particularly the laws on intellectual
property, trademark, patents and copyright, which can curtail online game
hacking?”

8
The rationale for choosing the topic stems from the fact that the researcher
works in this area. As part of the online gaming industry and with several
development and publishing umbrella companies under my management and
operation, it would only be advantageous to determine which laws are
pertinent and applicable in deterring online game hackers.
Based on my experience, the crime of hacking leaves an adverse impact on
businesses, particularly in relation to profits. This research will be able to
prescribe to other online gaming companies how to best fight hackers with the
use of legal means. Hopefully, it will also deter hackers from persisting in
their illegal activities seeing that they can be apprehended and brought to
justice with the existing IP and other cyber laws.
1.4 Problem Statements
With the aims and objectives presented, the research questions this study
would want to answer are as follows:
1) What is the current situation of online gaming in relation to hacking?
2) What are the adverse effects of hacking in online gaming?
3) What are the arguments presented by hackers for what they are
doing?
4) What are the arguments against hackers in relation to intellectual
property?
5) What are the most significant IP and copyright laws that can be used

9
against online game hackers?
6) Are the existing IP and copyright laws, as well as other legislations,
sufficient in curtailing the acts of online game hackers?
1.5 Methodology
To be able to accurately answer the research questions presented herein and
to achieve the objectives indicated, it is necessary to gain primary sources
that will serve as the backbone of this research.
Given that the research topic consists of broad components, it would be
necessary to provide answers to some other minor questions, e.g., what
constitutes hacking, what laws are violated by it, what are the effects of
hacking, why hackers do their acts, are there hackers brought to justice, if so,
what sentence are they likely to get and several more questions similar to
these. These and any other questions included in the legal article need to be
answered appropriately and accurately. As such, it is necessary to gain sound
information from secondary sources, preferably peer-reviewed journals and
legal books, statistics from government agencies and data from law firms,
among others.
The use of credible and reputable primary and secondary sources will give
strength and soundness to the study. It is therefore necessary that the right
research methods be employed to come up with a successful legal research.
To do this would allow for the easier interpretation, discussion and analysis of

10
the legal issues involved in the subject being researched.
There are many legal research methods. This study will mainly be achieved
by using primary and secondary references accessible online and in printed
format.7
One good way of doing the legal research is to act like a law
librarian.8
This is due mainly to the fact that librarians are highly
knowledgeable with the different types of resources, e.g., legal, general, as
well as with research tools.9
It is extremely important to include certain established information that would
support the thesis and answer the questions. Many of the questions provided
are answerable by existing pertinent laws, statutes, policies, rules and
directives. Given that these laws differ according to jurisdiction, it is
imperative to identify the problems and the corresponding relevant laws. The
fact that these are primary sources, the answers that are to be gathered are
guaranteed to be reliable and sound.
Hacking online games is basically an internet crime, the scope of which may
prove problematic since it is within the internet sphere. An applicable
international law on copyrights or trademark may be used or a national rule or
statute can be imposed depending on the country where the head office of
the online gaming firm is located. In cases where such country or state
belongs to an international entity, e.g., the European Union (EU), other laws
7
E Volokh, Academic Legal Writing: Law Review Articles, Student Notes, Seminar Papers, and Getting
on Law Review (4th edn Foundation Press, New York, NY 2010).
8
R Buckingham, Thinking Like a Librarian: Tips for Better Legal Research (Thomas M. Cooley Journal
of Practical and Clinical Law, Vol. 12, p. 1, 2009).
9
American Association of Law Libraries, The AALL Biennial Salary Survey & Organizational Character-
istics 11 (2009).

11
can likewise apply that cover all member states. Another option in regard to
the applicable laws would be the country where the hacker resides, that is, if
he is identified and located.
From the instance provided, it is apparent how complex the problem of online
gaming hacking can be. The determination of the laws to apply alone may
prove confusing. On the other hand, this fact can be used in the favour of the
online gaming company since it is in the position to consider all possible legal
actions and make use of the one that would best benefit it or the one that will
win the case.
Besides the consideration of jurisdiction when researching, another method
that would benefit a legal researcher is to find primary sources that are
current and updated, e.g., updated laws. It would be likely that while finding
sources online, the writer may come across repealed or out-dated laws.
Making the mistake of using them and basing from them findings in the legal
article renders the entire paper erroneous. It is therefore necessary to ensure
updating of the legal authority accessed.
To sum it up, this research will utilise the use of primary and secondary
sources using deductive reasoning. It will likewise make use of data and
statistics to be obtained from law firms, government agencies and online
gaming companies to gain a better insight of the problem and provide
accurate analysis and interpretation of data. This was done both through the
collection of previous studies made on the subject and from first-hand

12
methods such as surveys and interviews. Given the limitations presented by
the interpretation of such data, focus on the use of primary references will be
made. By primary references, it means laws, statutes, legislations,
constitutions, etc.
1.6 Legal Article Structure
This legal article is consists of six main chapters that will slowly unfold the
journey mentioned in its very title. This journey started with the Introduction
Chapter that briefly accounted for the main reasons and problems that it aims
to address as well as a short background of the topic. It also indicates the
scope of the legal article, which ideally, would be limited within the most
pertinent information that will serve as answers to the problems posed.
The Literature Review chapter contains the main information by which
succeeding chapters will be based. It contains a comprehensive account of
the important subject, issues, researches and studies made by other experts,
and background information of the legal article topic.
The Methodology Chapter accounted for the means by which the main
questions are to be answered, i.e., through the use of deductive research
based both on primary and secondary sources. The Likert Scale system will
likewise be utilised to answer certain inquiries that will lead to the answers
being sought after.

13
The Fourth Chapter contains the analysis made on the data collected based
on the methodology adapted. This chapter will show that based on the
primary and secondary data gathered, credible findings are obtained.
The Fifth and Sixth Chapters, i.e., the Discussion and Conclusions chapters
basically discussed and summarised the findings based on the research
made on the main subject. The last chapter also contained some
recommendations that may be considered by readers in their fight against
hacking.
Chapter 2. LITERATURE REVIEW
2.1 Introduction
Most countries worldwide now enjoy access to the internet. The number of
internet users has in fact ballooned to approximately two and a half billion by
mid 2012,10
as shown by the table and chart in Figures 1 and 2 of the Appen-
dices, respectively. While this is a good sign of advancement in technology,
it likewise poses several legal and regulatory issues, e.g., will national or in-
ternational law apply in cyberspace, what is the connection of copyright to
virtual and digital content, who can regulate cyberspace or can it be regulat-
10
Retrieved from Internet World Stats, www.internetworldstats.com on 3 April 2013.

14
ed, can there be data protection in the internet, can privacy be possible in the
web, etc. These questions are raised since in seeking for the law to apply
when dealing with a cybercrime, what can be largely found are those that are
applicable to the pre-internet era.
This paper intends to somehow shed a light on these questions and as well
as those posed in the preceding chapter by presenting the laws that may be
used by companies or any other individual whose rights are violated in the
realm of cyberspace, particularly when it comes to online game hacking. To
understand the subject matter well, the succeeding subheadings will provide
further information on the matter.
2.2 Cybercrime
The days when cybercrime is practically just a teenage mischief done in the
basement of his house is long gone. Cybercrime today has evolved into an
organized and complex hierarchy, just like a business enterprise itself. It has
its own heads, engineers, staffs and money mules with their own roles to play
with the purpose of profiting from it. There are however some cases of doing
it for vengeance.11
Cybercrime is defined as an illegal behaviour done through electronic
operations that aims for the security of computers systems as well as the data
processed by these systems. It is likewise defined as any illegal act that is
11
Fortinet Inc., Fortinet 2013 Cybercrime Report: Cybercriminals Today Mirror Legitimate Business
Processes (www.fortinet.com).

15
made through, or in relation with, a computer network or system, which
includes, among others, crimes such as offering, illegal possession or
distribution of information through the use of said computer network or
system.12
These definitions were developed during the workshops held by
the 10th
UN Congress on the Prevention of Crime and the Treatment of
Offenders held in 2000.13
While there are other definitions attached to the
word, the two mentioned are enough to cover the specific cybercrime this
paper will be focusing on, i.e., hacking.
“Hacking” as an offence is the unlawful access of a computer system and is
considered to be one of the oldest type of computer related crimes.14
When
computer networks, e.g., the internet, was developed, hacking has turned into
a mass phenomenon.15
Hacking also comes into several forms. There are those that involve
circumventing or breaking of password protections, illegal acquisition of
password through the use of faulty software or hardware, spoofing,
keylogging methods, etc.16
Illegal access of computer networks has grown to
over more than 250 million worldwide in just one month in August 2007.17
In
12
AP Kumar, Cyber Law, A View to Social Security (Bangalore, 2009) p 29
13
10
th
UN Congress, Crimes Related To Computer Networks (Background paper, 10
th
UN Congress on
the Prevention of Crime and the Treatment of Offenders, 2000, A/CONF.187/10) p 5. Retrieved from
www.uncjin.org/Documents/congr10/10e.pdf.
14
S Levy, Hackers: Heroes of the Computer Revolution (Anchor Books, 1984); P Taylor, Hacktivism: In
Search of lost ethics? (in Wall, Crime and the Internet, 2001) p 61.
15
S Biegel, Beyond Our Control? The Limits of our Legal System in the Age of Cyberspace (Hacker-
watch, August 2007 Issue, 2001) p 231.
16
Ibid.
17
High-Level Experts Group, ITU Global Cybersecurity Agenda (Global Strategic Report, 2008) p 29.
Retrieved from www.itu.int/osg/csd/cybersecurity/gca/global_strategic_report/index.html on 4 April
2013.

16
the case of online gaming, hackers make use of software tools that can make
their attack on a computer system automated.18
With this type of software,
even a single hacker can launch an attack with the use of only a single
computer on thousand of systems in one day.19
For those hackers that can
make use of more than a single computer to do their attack, for instance, via
the use of bot-net,20
the level by which he can do his hacking is further
increased. Besides legal means, these types of hacking problems may be
prevented or stopped through the update of the software applications and
operating systems of online gaming companies regularly. This may however
prove costly.
However, while these cybercrime entities are highly organized and well estab-
lished, they are not insurmountable and can be beaten. This paper aims to do
just that by providing the information and awareness about the problem with
online game hacking as well as the possible legal solutions that can be em-
ployed to put a stop to this problem.
2.3 Profile of a Hacker
Hacking is a covert act and can in fact be considered illegal. This is why only
a small number of hackers, if any, would openly broadcast who they are or
18
K Ealy, A New Evolution in Hack Attacks: A General Overview of Types, Methods, Tools, and Preven-
tion (GSEC Practical v.1.4b, 2003). Retrieved from www.212cafe.com/download/e-book/A.pdf on 5
April 2013.
19
C Wilson, Botnets, Cybercrime, and Cyberterrorism: Vulnerabilities and Policy Issues for Congress
(2007) p 4, Retrieved from www.fas.org/sgp/crs/terror/RL32114.pdf on 1 April 2013.
20
ITU Botnet Mitigation Toolkit (2008). Retrieved from www.itu.int/ITU-
D/cyb/cybersecurity/projects/botnet.html on 4 April 2013.

17
what they do. However, the malicious damage that they can perform to
computer networks and systems is massive.
The word “hacker” is basically an individual that gains access to a computer
system through the circumvention of the system’s security and by entering
areas without authority to do so. However, there are arguments that contend
that hackers may either be good or bad, those that contribute positively into
the cyber world and those that abuse it.
Hacking is believed to have originated from the prestigious Massachusetts
Institute of Technology (MIT) when a group of students broke into Arpanet,
which up to now still haunts the federal government of the USA.21
Forestor
and Morrison22
described a hacker to be someone who enjoys knowing the
computer systems details and stretch their capabilities on it, one who
enthusiastically programs than simply theorizing about it, one who can
appreciate the so-called “hacker ethic”, one who can easily and quickly learn
how to program, is an expert on a certain program or an expert of any type
and finally, a malicious individual who meddles and tries to find out
information by poking through the computer system. These descriptions,
though some may prove true, is not sufficient to describe the hacker to be
referred to in this paper. Online game hackers mainly do their deeds for gain
or profit. Langford’s definition is more apt, i.e., a hacker is an individual who
21
P Himanen and M Castells, The Finnish Model of the Information Society (SITRA Report Series, Vol.
17, 2001).
22
T Forestor and P Morrison, Computer Ethics: Cautionary Tales and Ethical Dilemmas in Computing
London (MIT Press, 1994).

18
is well-knowledgeable in computer systems and makes use of such
knowledge in gaining illegal access of said systems either to steal or corrupt
data.23
The Hacker Ethic mentioned in The Hacker’s Dictionary24
speak of five
principal values, namely, that access to computers should be total and
unlimited as long as it will teach about the way the world works, that all
information must be free, that hackers should be judged by their hacking not
demographics, that authority should be mistrust and decentralization
promoted and finally, that one can create beauty and art on a computer.
Obviously, this list was made without regard for the right of companies and
owners of the computer systems these hackers have adversely affected.
2.4 Online Gaming
The topics of hacking and how IP laws are applied to it can prove too broad
thus the need for this paper to be further delimited to hacking of online
gaming. The online gaming industry was just a few years back, only in its
infancy. It has however presently become a billion-dollar industry which at
2009 provided a global revenue of $57 billion dollars.25
In a 2007 research, it
showed that Chinese online gamers spent more than 1.7 billion dollars on
23
D Langford, Practical Computer Ethics ( London: McGraw Hill Inc., 1995).
24
T Forestor and P Morrison, N 22 above.
25
DFC Intelligence. Retrieved from http://www.dfcint.com/index.php on 4 April 2013.

19
games which became 6 billion by 2012.26
While the traditional games that many got used to still have a decent
customer base, what has become most popular now to gamers is the so –
called MMOG or MMORPG. It stands for Massively Multiplayer Online Game
or Massively Multiplayer Online Role-Playing Game. This type of game can
support as many as thousands of gamers simultaneously. Played over the
internet, this game allows gamers to have a role-playing experience done in
the virtual world. Millions of them battle and interact in a virtual universe,
taking their hero roles while amassing virtual items and money for their
characters, likewise referred to as their avatar, to fight their virtual evil
enemies.
His type of online game has become a phenomenon in the internet and this is
likewise the type of online game this legal article focuses on. They are
existent in the databases of server computers being maintained by online
gaming companies, which serve as the operators. They are commonly
accessed using client programs that are highly specialised and are able to
present the virtual world aurally and visually. These games are persistent as
they continue to evolve and can be played again even if the player turns off
the computer.27
Given its popularity and the money involved in its development or publishing,
many operators of online gaming have become cognisant of the need to
26
Ibid.
27
B Book, Moving Beyond the Game: Social Virtual Worlds (State of Play 2 Conference, New York Law
School, 2004).

20
secure their gaming platform. The hacking of accounts can pose an actual
threat which may not only wear down their customer databases but could go
as far as bring them to bankruptcy. These gaming companies would also
want to provide their gamers with a secure and excellent online gaming
experience and offer them the highest quality of products and services. This
is why it is necessary for them to spend on security measures against
hackers. However, there are hackers that can prove to be very good that
they can go through the best of protective measures implemented by these
gaming companies. This is where the need for more drastic measures
becomes necessary, e.g., through legal means.
2.5 Online Game Hacking and Its Effects
In MMOG, MMORPG and other similar virtual games, virtual properties and
assets such as currencies, accounts, and items are now often traded as real
money.28
This is the focus of this legal article. These virtual properties have
become the target of many hackers. They get the items illegally, then sell
them online for a fee that is either lower than what is offered by the online
gaming company or is not offered for sale at all. Buying gamers would rather
buy them than go through different levels to gain them. This is the gamers’
way to gain strength, level up, etc., faster and easier. This has turned out to
be a profitable business for hackers but a big nuisance to online gaming
28
V Lehdonvirta, Real-Money Trade of Virtual Assets: Ten Different User Perceptions (Proceedings of
Digital Arts & Culture, IT University of Copenhagen, Denmark, 2005), pp. 52-58. Retrieved from

21
companies.
To cite a first-hand experience with hackers, as a Chief Executive Officer of
an online gaming company, it has been an unfortunate event for my firm to
have come across them. One of the games the company publishes is Cabal
Online. Similar to another big and popular online gaming company, Blizzard
Entertainment, the developer of World of Warcraft (WOW), Cabal provides
players with “alz”, WOW’s “gold” equivalent. These in-game items cannot be
bought, they are earned while the player levels up in the game. Once gained,
it can be traded with other important and useful items in the game. This has
become the target of hackers, which sells them to gamers for real money.
These hackers make use of state-of-the-art software that makes possible the
harvesting of these in-game items faster.
Needless to say, such an act greatly affects the company in terms of profit.
Instead of the players trying to gain said items online while playing, buying
other items along the way, they can simply buy from these hackers and level
up easily. A big percentage of the expected profit goes to the hackers, leaving
the online gaming company with great losses. For smaller companies, this
can lead to as far as bankruptcy. For big and medium-sized online gaming
companies such as Blizzard, security measures such as high quality software,
which are constantly updated and maintained, as well as legal remedies are
implemented. For smaller companies, these solutions can prove very costly.

22
2.6 Criminal Hacking vs Ethical Hacking
There is a wealth of arguments why hackers act as they do, e.g., their “right to
hack”.29,30,31
One of the most popular, and to many, most acceptable, is their
contention that people should get free access to information as against the
intellectual property rights of online gaming companies.
In recent times, two parties have been waging over the discussion on access
to intellectual property and information. Those who advocate Anglo-American
law on privacy, trade secret, patent, and copyright, and fight against net
surfers, hackers, and cyber punks who contend that information "wants to be
free". Those who support a system of limited access to information contend
that inventors and authors have the right to restrict the intellectual work they
create and individuals have a right to privacy that protect confidential
information from being accessed by the public. Manipulation, trading, or
accessing of the information under debate, in both cases, is regarded as a
form of infringement - a section of control has been breached without
validation.32
On the other hand, those who support free access contend that a model
centered on the author or inventor gives unwarranted recognition to
29
A Moore, Privacy, Intellectual Property, and Hacking: Evaluating Free Access Arguments (in Inter-
net Security: Hacking, Counterhacking, and Society, K Himma, ed., Jones & Bartlett Publishers,
2007).
30
HA Melendez Juarbe, Technopolitics and Copyright Regulation: The Limits of a Right to Hack
(Seminar in Latin America of Constitutional Law and Politics, Costa Rica, 2011).
31
AD Schwarz & R Bullis, Rivalrous Consumption and the Boundaries of Copyright Law: Intellectual
Property Lessons from Online Games (Intellectual Property Law Bulletin, 2005).
32
K Himma, Information and Intellectual Property Protection: Evaluating the Claim That Information
Should Be Free (UC Berkeley, 2005). Retrieved from http://escholarship.org/uc/item/3xz1t13v.

23
innovators. If we regard inventors, authors, and most significantly,
information, as a social product, then it is unclear why persons and
companies should be permitted in accumulating and restricting content at the
society's expense. Hackers have contended every person has a right to
information, and that every person should have uncontrolled and unlimited
access to computer systems. Defense for this prospect is found in present
attitudes relevant to sharing of files. It is approximated that for every legal
copy of a program, there are roughly 2-10 illegitimate copies which cost
software manufacturer more than 10 billion in lost profits every year. For such
cases of copyright infringement, the usual justification provided is that
regardless of how many illegal copies are made, the owner still have his or
her copy of the software.Also, it is a common phenomenon that networks,
instead of software, are hacked. It is almost not possible to do a meaningful
analysis of attempts of network hacking due to the dramatic developments of
automated hacking tools. Networks, websites, and computers of all kinds are
being explored almost every minute. A lot of those who perform such
activities claim that they should be thanked because they are doing a public
service by discovering faults in security.33
Prior to taking into consideration the "free-access" and hacking stance, I will
present a number of arguments supporting intellectual property and privacy. If
the said arguments are gripping, then an ethical conjecture favoring the
restriction of intangible works and personal information will have been
33
Ibid.

24
determined. Then, I will consider three arguments usually provided by those
who support the "free-access" and hacking stance. After presenting and
analysing these arguments, I will contend that this stance on restricting and
accessing information is not strong enough to dominate the ethical
presumptions favoring privacy and intellectual property.
It has been contended that an ethical presumption favoring discretion and
confidentiality is validated by appeal to the worth of revere, independence,
and privacy for individuals, and a general privilege to create contracts
relevant to personal information. A person who does not have control over
access to his own personal information or body demonstrate violence, higher
levels of stress, and other physiological and psychological conditions.
Permitting a person to control access provides him the ethical space for
pursuing his own trials in living-social orders acknowledging such control
demonstrate revere for individuals.34
An ethical presumption favoring intellectual property has been via a Lockean
paradigm or based in motivations to innovate. Based on the Lockean
paradigm, ethical claims to an intellectual property are based in merit or
desert together with a "no harm, no foul" belief. As for the latter, control is
awarded to the inventor or author of intellectual property because awarding
such control gives motivations required for social development.
Lastly, three dominant arguments supporting the free access or hacker
34
Ibid.

25
stance have been conferred and set aside as being strong enough to
supersede the presumptions favoring intellectual property and privacy. The
first argument is the social and security benefits stance, which is tricky
because it does not take into account the unseen costs of imposing risks on
others. When a hacker breaks into a software, network, or a computer, he
imposes ethically related risks on others without their permission. One cannot
be certain of the true intent of an unauthorised hacker, just like a intruder at
our home, or a peeping Tom. In addition, we must endure the costs of having
to re-establish the reliability and security of our systems.35
The second argument that information is non-competitive falls short because,
among other reasons, it is not by any means evident that just because
something can be consumed and used by many persons at the same time
that it should be. Some very clear examples are aggressive pornography and
confidential sensitive information.
The third argument that information is social in nature is based on a vague
and ambiguous concept of society, or that society can deserve or own
something. Even if society had some entitlement to some knowledge pools,
persons have practically bought such information via tuition fees, and such. In
addition, A plea to the social nature of information and intellectual property
appears weak and not credible where privacy interests are in jeopardy.
In finality, despite all the contentions presented by hackers, the presumptions
35
Ibid.

26
on IP and privacy prevails and should be given favour over the hackers’ need
for access and control of online information.
2.7 Pertinent Criminal Hacking Laws
It is this paper’s focus to put a curb, if not completely eliminate, online gaming
hacking problems through the use of intellectual property laws. However, it is
also necessary that all possible legal remedies be included in curtailing
hacking crimes, especially criminal hacking laws. The 1990 Computer
Misuse Act is one of the major criminal laws that can be directly applied to
online game hacking criminal acts.
Recent statistics indicate that during year 2012, about £25 billion was the cost
of the computer software industry worldwide resulting from the activities of
hackers. In addition, there were more than 20,000 successful strikes from
hackers only last January 2013 in the United Kingdom alone. It was indicated
by some evidences that a growing amount of these strikes are due to political
reasons.
Stipulation to secure computer data and matter against illegal amendment or
access, and for related purposes is the role of the 1990 Computer Misuse
Act. However, it is important to note that the terms "data", "program",
"application", or "computer" are not defined anywhere in this act; this was
intentionally done from the recommendation of the Law Commission saying
that technology progresses very quickly that the given definitions would soon

27
be out-dated.
A Report on Computer Crime was published by the Scottish Law Commission
in 1987. The introduction of a new crime in Scotland was promoted in this
report. This crime is the acquisition of "unauthorised access to a computer".
Subsequent to this report and due to public alarm over computer misuse by
unauthorised individuals or companies, a committee was established by the
English Law Commission to look into Computer Misuse. Report No. 186 was
published by the Law Commission in 1989 which advocated a number of
changes to the current law. Michael Colvin sponsored a Private Member's Bill
that was brought in to instigate the recommendations of the Law Commission.
This Act's most crucial upshot is that it made computer misuse a criminal
offence. Three new criminal offences have been created by this Act. The first
is the unauthorized access to computer material, intended to condemn the
actions of both the "insider" and the "remote hacker", e.g. an employee, who
goes over his permit to use a computer.
Anyone who consciously causes a computer to carry out any function with the
purpose or obtaining unauthorised access to any data or application on any
computer is guilty of this offence. The stipulation that the accused causes the
computer to carry out any function does not include "computer
eavesdropping", reading data on a computer screen, or reading classified
computer output. The accused does not need to be successful in breaking or
accessing any security measure in order to be guilty of this offence. A remote

28
hacker who only causes a computer to display its login screen is already
considered guilty of an offence. On the other hand, any person who can
directly access a computer commits the offence as soon as he turns on the
computer without authorization to do so. The person's action does not have to
be targeted at any specific data or program in the computer; this includes
coverage for a hacker who illegally accesses a computer without any certainty
of what programs and data he will discover there.
The prosecutors must show and provide evidence that the accused had
intentions of obtaining access and that he knew that the access was not
permitted. This offence can be tried in a Court of Magistrate and comes with a
punishment of a maximum of six months imprisonment, a penalty of a
maximum of £2000, or both.
In addition, a court has authority under other laws to seize devices designed
or used for committing an offence and to grant damages.
The second offence is unauthorised access to a computer with intentions of
committing or facilitating perpetration of more offences. This is an intensified
form of the first offence, and it includes activities enough to execute the first
offence but with the intent of carrying out more grave offences.
It is intended to provide coverage for such instances as obtaining
unauthorised access to a computer of a bank for the purpose of committing
theft by sending the money to your own account, or accessing classified
information on a database of a computer to use to blackmail the person or

29
company.
An individual becomes guilty if he carries out an offence under Section 1 with
the intention of committing another offence to which Section 2 involves, or to
make it simpler or faster for someone else or himself to carry out such an
offence. Section 2 is applicable to crimes for which the punishment is set by
law or for which an individual older than 21 could be imprisoned for 5 years. It
is irrelevant whether the offence is to be done later or at the same time, and
an individual is guilty even if it is not possible to have committed the further
offence.
This is an offence where the accused can be indicted. If tried in a Court of
Magistrate, the punishment is prison time of a maximum of 6 months, or a
penalty that could reach the statutory maximum, or both. If tried in a higher
court, the punishment could reach as much as five years imprisonment, or a
fine, or both.
The third offence is modifying or altering computer material without
authorisation to do so. This is meant for instances of intentional corruption or
deletion of computer data or applications. It is also for cases wherein a
computer "virus" or "worm" is introduced.
An individual commits this offence if he deliberately modifies the data or
programs of any computer without authorisation, and he is aware that is
unauthorised. The prosecutors must prove that the accused had the intention
of damaging the dependability of any data or program, preventing access to

30
such data or program, or damaging the computer's operation. The action
does not have to be targeted at any specific modification, or any specific data
or program, or any specific computer.
2.8 Intellectual Property (IP)
The scope of intellectual property law is international. Brands, inventions,
authorship, designs and other immaterial creations can easily cross
borderlines. Such crossing is made even faster in the internet. All one has to
do is click a mouse or push a button. It has therefore becomes questionable
which property rights has to be protected by law and when. It is the
contention of this paper that intellectual property rights owned by online
gaming companies should be protected by law from hackers whose intention
is simply to gain from their deeds at the detriment of the company.
To better understand the subject matter, it is best to go to the root. What is
the definition of object of property? The legal term “property” is actually
shorthand for “property right’, which represents the association between an
object and the owner. Normally, objects such as movable goods, real estate,
claims and rights, are owned by a specific individual (either an actual person
or a legal entity). Object of property is an owner’s asset and is listed on his
balance sheet as a part of his estate. In the event of bankruptcy, these assets
will be liquidated by the receiver to pay off the bankrupt owner’s creditors.
The owner’s relationship with his assets is the primary focus of estate and

31
property law. These assets can come in all sorts of “shapes and forms” and
may either be all in one specific jurisdiction or scattered over several
jurisdictions. In terms of private international law, the owner and his domicile
are constant. The domicile is also highly significant from an estate law
perspective because the owner’s residence is most likely to be the jurisdiction
where proceedings of the bankruptcy will be started and also under which
laws this said bankruptcy will be settled. In private international law, it is a
well-known principle that the appropriate law to a legal relationship must be
the one that it is most closely related to. However, there are exceptions to this
principle. In contracts, for example, Article 4 found in the 1980 Roman
Convention,36
particularly the stipulation on contractual obligations (Rome I)
states that a contract is seen to be most closely related to the country where
the party affecting the contract is situated. This location pertains to the
country of the said party’s habitual residence or its main administration (for a
corporation) and, if the contract was entered into during the party’s trade, in
the primary place of business. However, there are a few exceptions to this
rule. For instance, for immovable property, a contract entered into in the
absence of a choice of law is assumed to be most closely linked to the
country where said immovable property is located. As for a tort, according to
Rome II’s Article 4(1), the applicable law is that of the country where the
damage occurs. These aforementioned provisions are only exceptions only to
the principal rule that the domicile law, referring on jurisdiction, largely
36
1980 Roman Convention. Retrieved from eur-
lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX...EN:HTML on 25 March 2013.

32
handles the affiliation of the owner and his assets. These exceptions are
brought about by the condition that a closer connection to a different
jurisdiction exists as opposed to the jurisdiction of domicile because the
owner, the acts involved or the relevant object is located in that other
jurisdiction or gives rise to circumstances that has an influence outside of the
domicile’s jurisdiction.
For a while now, industrial property rights have maintained an international
treaty framework. Right from the beginning, the 1883 Paris Convention for the
Protection of Industrial Property37
has served as a home for patents.
Therefore, having been a nation that had no patents ever since 1869, The
Netherlands (among the original Convention’s eleven signatory states in
1993) had to reinstitute a patent system in 1910. From 1883 until 1979, there
have been seven revisions made to the Paris Convention. Subsequently, the
1994 Agreement on Trade Related Aspects of IP Rights38
(more popularly
called TRIPs) offered an added formidable global treaty platform especially
for patents. For the time being, the 1970 Patent Cooperation Treaty39
along
with the 2000 Patent Law Treaty40
fused and developed the procedures
relevant to the filing of international patent applications. The patent law, in a
European context, has also been unified by the 1963 Strasbourg
37
Paris Convention for the Protection of Industrial Property 1883. Retrieved from
www.wipo.int/treaties/en/ip/paris/trtdocs_wo020.html on 25 March 2013.
38
Agreement on Trade Related Aspects of Intellectual Property Rights 1994. Retrieved from
www.wto.org/english/docs_e/legal_e/27-trips.pdf on 28 March 2013.
39
Patent Cooperation Treaty 1970. Retrieved from www.wipo.int/pct/en/treaty/about.html on 28 March
2013.
40
Patent Law Treaty 2000. Retrieved from www.wipo.int/pct/en/activity/pct_2000.pdf on 28 March 2013.

33
Convention41
and the 1973 EPC or the European Patent Convention.42
This
list indicates that the international patent community has been active in terms
of harmonizing and unifying application procedures for international patent
and issues of substantive (national) patent law. Inventive step, unity of
invention, novelty, claim interpretation, sufficient disclosure and industrial
applicability are some of the issues that have been given a lot of
consideration. As a result, it has become common for national courts within
European jurisdictions to bring up and talk about and even contend with
patent judgments by other European courts where these said issues are
being handled. Unfortunately, commercial or civil law regarding the issue of
how patents can be licensed, transferred or utilized as collateral have not
been given as much attention. The treaties barely discuss these issues and
are still mainly a national law affair.
On the European Patent Convention,43
or the lex protectionis rules, a good
example of this national approach involves handling European patent
application being an object of property as seen in Chapter IV of the EPC.
Article 74 states that in each assigned Contracting State, with the effect on it,
an EU patent application, as object of property, must be conditional on the
law related to national patent applications in that State, unless the Convention
41
Convention on the Unification of Certain Points of Substantive Law on Patents for Invention of 1963.
Retrieved from dl.acm.org/citation.cfm?id=23500 on 28 March 2013.
42
European Patent Convention of 1973. Retrieved from www.epo.org/law-practice/legal-
texts/html/epc/1973/e/ar52.html on 28 March 2013.
43
Retrieved from www.epo.org › Law & practice › Legal texts on 25 March 2013.

34
states otherwise. From a property law standpoint, a lone European patent
application is treated as a collection of national rights by the Convention.
Since a granted European patent, the EPC’s end product, is not exactly
existent but directly falls apart into a collection of national rights, such solution
is efficient and sensible.
As stated in Article 74 of the EPC, unless otherwise stated by the Convention,
national law only applies. An in-depth look at Articles 71 to 73 will reveal that
this reservation in connection with conventional law appears to be more
threatening than it really is. In Article 71, specifically under the subject rights
transfer and constitution, indicates that a European patent application can be
passed on or may produce rights for one or more of the selected Contracting
States. The fact that application may be transferrable is not really much of a
surprise. It is vital, however if a Contracting State’s national law is arranged in
such a way that the only time a right can be transferred if a statutory provision
to that effect is existent. This is the case for Dutch law. After the Dutch Civil
Code44
was made effective on January 1, 1992, a new rule was included in
Article 3:83(3) BW of the Dutch law, which states that an IP right can be
transferred only if provided for in a statutory provision. In Dutch law,
specifically the Dutch Patent Act, however, there is no provision that indicates
that a European patent application may be transferred. Thus, European
patent applications cannot be assigned or transferred as a matter of Dutch
law, if not for Article 71 of the EPC. Article 71 also indicates that application
44
Dutch Civil Code, Retrieved from www.dutchcivillaw.com/civilcodegeneral.htm on 28 March 2013.

35
may bring rights for one or more of the chosen Contracting States. The
Implementing Regulations of European Patents45
shows what this may entail.
Under Rule 23 and 24, it is clearly indicated that the 1) transfer or grant of
license, 2) transfer or formation of a right in rem with regard to European
patent application; and 3) any legal execution method influencing such
application are what the Convention talks about. Article 72 presents a
mandatory rule for the way a European patent application must be assigned –
a European patent application assignment should be made in writing and
must contain the signature of the parties involved in the contract. While a
written document is not much of a problem, given that most assignments are
normally in written form, the signatures may cause some unnecessary
complications, unless national law would require only the assignor’s
signature. In case of an international transaction among party representatives
from different international destinations, getting the needed signatures can
become a problem and is not exactly ideal. Article 73 ends the list by
indicating that a European patent application can be licensed in part or in
whole for the entire or part of the designated Contracting States’ territories.
Naturally, an IP right has an effect mainly in the jurisdiction where it can be
used in opposition to third parties. Its formation, scope, term and content are
the main factors that affect and are most directly related to the country
wherein this said IP right exists. Hence, these issues are ruled over by the lex
protectionis, with the exception of an IP right’s property aspects where the lex
45
Implementing Regulations to the Convention on the Grant of European Patents. Retrieved from
www.epo.org/law-practice/legal-texts/html/epc/2010/e/ma2.html on 25 March 2013.

36
protectionis is a less natural option. Managing an IP right as an object of
property involves managing the issues concerning the fact that this right is
part of the estate and all the assets of its owner. These aspects are more
relevant to the jurisdiction as opposed to the habitual residence of the owner.
This said jurisdiction will also oversee the transfer of estate in the event of a
merger or inheritance and will presumably apply if bankruptcy occurs. Since
matters of ownership principally involve the relationship of the proprietor and
his assets, the jurisdiction of the domicile of the proprietor is most relevant.
The law of jurisdiction wherein the IP right exists only becomes significant
again as the law that is most closely associated to the IP right’s owner and
the potential infringer’s relationship when the IP right involved may be used
against a possible infringer. In view of the fact that an IP right is both a
national right and a right that may be used in opposition to potentially
abundant third parties, law that handles aspects of ownership is not the best
option when it comes to an IP right’s infringement-related aspects.
Nevertheless, it appears that choosing the law of the domicile of the
proprietor to be the law managing the aspects of an intellectual property right,
as object of property, can barely come across serious conflict and gives off
the most cost-effective result.
2.9 Other Pertinent IP Laws
While many are aware that hacking is a crime and that intellectual property
laws can be used to curtail it, many are not aware of other IP laws which can

37
be used and which exist. This subheading contains several pertinent IP laws,
as well as other similar means, that may be used by companies in battling
hackers, particularly in UK and even the EU.
FAST, which stands for Federation Against Software Theft,46
is, as the name
suggests, a group of software manufacturers in UK focused on battling
against software theft. In 1991, FAST claimed that GEC Marconi Instruments
copied their software without the authority to do so, and took action against
the latter. FAST acquired an order referred to as "Anton Piller" in a notorious
test case, to scrutinize the computers of GEC. This was a kind of sanction,
which functioned as a search warrant, ordering the accused to permit a
search party and consent to confiscations. Failure or refusal to obey would
have put GEC in contempt of court and its officials would have been
imprisoned. The case finished off harmoniously with GEC accepting to
execute an "audit" of their software and seemingly accepting to purchase
additional software copies, consequently. FAST ordered a Mori Poll in 1998
wherein 2.4 million users confessed to have violated the copyright law.
Business Software Alliance (BSA)47
is an association established by
Wordperfect, Autodesk, Ashton-Tate, Aldus, Microsoft, and Lotus, in 1988
and is based on the United States. It underwent a merging with Software
Publishers Association, and today has more than 500 members, with offices
in sixty-four countries.
46
Federation Against Software Theft. Retrieved from http://www.fastiis.org on 1 April 2013.
47
Business Software Alliance. Retrieved from www.bsa.org on 1 April 213.

38
The following table demonstrates the degree of the software piracy problem
worldwide.
Country Pirated
Software (%)
Value of Pirated
Software
Units of
Software per
CPU
United Kingdom $300,000,000 0.98
Australia 0.82
France 0.65
Korea $350,000,000
Vietnam 98
China 96 $1.4 billion
Indonesia 93
Thailand 84
Germany 75
Japan 75 $800,000,000
Asia (average) 55
Italy 45 $350,000,000 0.40
United States of
America
40 $2.8 billion 1.50
Europe (average) 18
In 2000, BSA became extremely distressed when a Turin judge gave a verdict
that under Italian law, copying computer software was not unlawful as long as
the copies are not sold for commercial gain. A local businessman was

39
acquitted of illegally copying software for industrial design, accounting, and
word processing, on the grounds that he copied them to be used only within
his own company.
Intellectual property is a collective term used to refer to several special
property rights. One of those property rights is copyright and 1988 Copyright
Designs and Patents Act48
is one legislation applied on it. Often, the many
different intellectual property rights are mixed up. There cold discussion of a
trademark being patented, or an invention being copyrighted, when it should
be the other way around.
Copyright simply refers to the right bestowed to writers, authors, or any
person who created a "work", such as books and other literary works, movies
and other film work, computer applications, designs, drawings, to restrict
others from copying or exploiting their works. Copyright automatically exists
when a "work" is started or created, without having to abide by any formality,
contrary to how patent rights work.
In general, "works" can be classified into two: original and derivative. Artistic,
musical, dramatic, and literary works fall into the original category.
Broadcasts, movies, films, sound recordings, and such fall into the derivative
category. A computer application is basically considered a type of literary
work. In spite of this, the extent of protection is extremely broad. Copyright
can be applied the how a computer application works when it is running: its
48
1988 Copyright Designs and Patents Act. Retrieved from
http://www.legislation.gov.uk/ukpga/1988/48/contents on 1 April 2013.

40
audio effects, display effects, and how it produces reports. However, the
primary stress of the 1988 Act is to protect and control others from compiling,
decompiling, or copying the computer application's source code. The Act's
power can also be extended to the computer application's structural features
and related data files, and up to the most fundamental algorithm of the
application.
Copyright law in England has begun 500 years ago, and has been controlled
by statute for nearly 300 years. It has always been hard for copyright to stay
abreast of the current technology; the Statute of Anne is the first modern
copyright law and it was initiated for protecting writers facing problems due to
progresses in publishing and printing technology.
It was not clear if computer applications were under the protection by
copyright in UK until 1985, when the 1985 Copyright (Computer Software)
Amendment Act49
finally became law. This was just a temporary law until the
primary patent and copyright law was amended to include computer
applications and software. Unusual as it seems, usually, contradicting
versions surface from seemingly totally unrelated sources. One of the most
crucial assertions on copyright surfaced in the year 1979 from an argument
between Swish Products Ltd and LB (Plastics), two producers of curtain rails.
The statement hereunder was made by Lord Wilberforce in his judgment:
"The protection given by the law of copyright is against copying, the basis of
49
1985 Copyright (Computer Software) Amendment Act. Retrieved from onlineli-
brary.wiley.com/doi/10.1111/j.1468-2230.1986.tb01685.x/pdf on 25 March 2013.

41
the protection being that one man must not be permitted to appropriate the
result of another's labour. That copying has taken place is for the plaintiff to
establish and prove as a matter of fact. The beginning of the necessary proof
normally lies in the establishment of similarity combined with proof of access
to the plaintiff's productions."
If the abovementioned statement is applied, it simply means that protection of
copyright appeals to our morals and ethics. It would never be one's intention
to steal someone else's property. However, copying software is the same
thing as stealing it.
Copyright violations can be classified into primary and secondary. Primary
copyright infringement takes place when a person or company directly
performs an infringing act or sanctions another to do so. For example, if
Person A gives Person B an original CD of a computer program to copy, and
Person B indeed copies it, both of them have committed primary copyright
infringement.
However, secondary copyright infringement are not involved in the original
infringement, but may be incriminated by selling or circulating the copied
software. It must be noted that there is a very significant difference between
the two types: those who have committed primary infringement are guilty or it
regardless of whether they are aware of the crime they have committed. On
the other hand, secondary infringers are only accountable if they are aware of
or have reason to believe that they are carrying out a copyright violation.

42
Primary copyright infringement involves the following activities: distribution of
illegal copies to the public, illegal adaptation, and illegal copying. According to
the 1988 Act, issuing copies of the work to the public is prohibited by the
copyright in all accounts of copyright work. This provides the owner of the
work full power over the publishing and distribution of his work. However, the
Act permits the appointment of legal copies, but valid in that the constraint on
the distribution of copies comprises rental for computer applications, films,
and audio recordings. Before the Act came into law, copyright owners were
only capable of restricting the rental of their work by a particular contract;
now, this constraint is automatic. Restricted by contract was confined to
owners in the mass-market issuance of works.
As regards illegal adaptations, the Act prohibits anyone to make an
adaptation of a musical, dramatic, or literary work. Among other meanings,
"adaptation" refers to the translation of a work. In terms of computer software,
this refers to the compilation or de-compilation of a program, or its conversion
to a different language. Due to this segment of the Act, the reverse
engineering of a program's object code back to source code is illegal unless
the owner has given authorization to do so.
In terms of illegal copying, the Act makes it clear that only the owner of the
copyrighted work has exclusive rights of copying the work or authorizing
somebody else to copy it. The coverage of copying provided by the Act
extends to any substantial portion of or the entire work. Copying means
making a reproduction of the work in material form, and includes storage of

43
the work in any avenue electronically.
This is strengthened by the stipulation in the Act indicating that copying
corresponding to any description of work comprises creating copies which are
temporary or supplementary to another use of the work. Running an
application involves having to copy the application from CD into the memory
of the computer, thus, it is a possibility to violate copyright by simply running
the application. This provides an owner the privilege to be adamant on a
license to be used. As a result, using a single copy of a program on a number
of computers is not legal without the consent of the owner.
Secondary copyright infringement, on the other hand, involves circumventing
copy-protection, facilitation of copyright infringement by transmission,
provision of materials for making illegal copies, and involvement in illegal
copies of a work. This Act particularly reinforces the privileges of owners of
copyright who supply their works with some kind of copy-protection included.
It is illegal to make available any equipment intended for circumventing copy-
protection. "Copy-protection" refers to the inclusion of any equipment or
means designed to damage the quality of copies made, or to inhibit or control
the copying of a work. However, this section requires meticulous analysis,
because it could include any software or hardware intended for recovering
data that has been corrupted. As a matter of fact, a stricter interpretation will
succeed, if an equipment has many possible uses, some of which are legal,
the likelihood of this section being applicable is very low. Nevertheless, if the
equipment was presented as having the ability to circumvent copy-protection,

44
then this section would most likely be applied.
In terms of the facilitation of infringement via transmission, theoretically, any
person who stores the work transmitted over some system of communication
is guilty of copyright infringement. Then again, this right becomes almost
insignificant due to the practical complexities of putting it into effect. The Act,
nevertheless, provides owners of copyright the right of preventing
transmission to begin with.
A person violates copyright if he transmits the work via a system of
telecommunication (if not, by including the work or having it broadcasted in a
cable program service) without the authorization of the copyright owner, with
knowledge or has reason to believe that illegal copies of the work will be
created through the reception of transmitting the work in the UK or elsewhere.
Thus, a person who distributes copies of a work over a network or through a
telephone without the owner of the work authorising the person to do so
commits secondary copyright infringement.
Second, a person violates copyright of a work if he imports, manufactures, or
commercially deals in a device or any means particularly intended or adapted
to make copies of "that work", and the person has knowledge or reason to
believe that the said device or means will be used for that purpose, without
the authorisation of the copyright owner.
However, there is not much clarity on how this section should be interpreted.

45
Interpreting it broadly, it is possible to argue that it covers tape decks, PCs,
and photocopying machines. For sure, makers of twin cassette decks usually
place a warning on their products which point out the Act's existence. The
likely interpretation is such a restricted one, based on the Act's reference to
"that work", it could be interpreted to refer only to equipment or devices
intended particularly for copying a certain work, not just for copying any other
work in general.
Lastly, a person commits secondary copyright infringement if he imports into
the UK, otherwise than for his own domestic and private use, any article
which he has knowledge and reason to believe is, an illegal copy for the work,
without the copyright owner's authorisation. It is also an offence to possess or
have involvement in illegal copies.
Both criminal sanctions and civil remedies have to be taken into consideration
when looking at the penalties for copyright infringement.
The Act specifies several classifications of criminal infringement of copyright;
these are basically intended for action against instances of intentional
infringement of copyright for commercial profit. Importing or copying illegal
software carries a punishment of, on summary conviction, that is, in a Court of
Magistrate, jail time for as long as 6 months, and a penalty of as much as
£2000, or both. Two years jail time and a penalty, or both, are the maximum
punishments on conviction by condemation, that is, by a Crown court.
The crime of possessing a device intended for copying software can be tried

46
only in a Court of Magistrate, and the punishment is a maximum of six-month
jail time, or a fine of a maximum of £2000, or both.
When an individual is tried for any of the abovementioned offences, the court
has power to have the illegal copies, or the equipment used to make the
copies, brought to the court. In addition, a magistrate is provided for by the
Act, if convinced that an offence has been done or is about to be done, and
that pertinent evidence is in the location, to order that the location be entered
by a constable, and a search be conducted, with the use of such necessary
force. Moreover, the Act stipulates that if a company commits an offence with
the authorisation or knowledge of a secretary, supervisor, manager, director,
or any individual acting in such ability, then that individual is guilty of copyright
infringement, and can be tried in court and penalized accordingly.
In the case of an established infringement, the copyright owner is privileged to
a number of benefits, such as taking out an injunction for the prevention of
further violation of copyright, for a command to surrender the illegal copies,
and to damages for the incurred losses through violations. In a number of
cases, a court order can be acquired prior to a trial without the suspected
violator being informed beforehand. The "Anton Piller" order is an order
which been utilized effectively against software, video, and music pirates. The
said order permits you to go into the territory of a person you believe to
violate copyright, without forewarning, and confiscate evidence, which might
be tampered with or disappear prior to the trial. The potential exploitation and
abuse natural in this kind of order are apparent and courts severely restrict

47
the use of it.
Damages are designed to provide compensation for the losses incurred on
the part of the owner resulting from the copyright violation. One method of
calculating how much damages should be paid is based on the amount it
would have cost to purchase a legal copy of the program rather than copying
it. Nevertheless, there is stipulation for a court to grant added damages if it
considers the crime to be specifically deliberate or if quite substantial benefits
have arisen from the violation.
On the whole, the law on copyright in other countries in Europe is a lot
weaker than the law in the United Kingdom. There have been seven
European Union Directives since 1992 targeted at making copyright law
uniform. Considerable discussion regarding software protection still prevails
today. Some authorities in Europe assert that software copyright protection
suppresses competition and innovation, and there have been actions targeted
at permitting decompiling and reverse engineering on open systems.
However, such actions have been opposed by groups such as FAST, which
advocated to the government the need to reinforce copyright law.
2.10 Conclusion
The literature put forward contained a wealth of information that indicates,
inter alia, that while there are a huge number of types and incidences of
online hacking, there also is a big number of laws and legal acts that can be

48
used to curtail the problem. The succeeding chapters will show that an
analysis of these facts and information will provide viewers conclusions and
solutions that can be useful to them if they are in the business of online
gaming are abused by hackers.

49
Chapter 3. METHODOLOGY
3.1 Introduction
The methodology employed in this legal article depended on its aims. To
reiterate the purpose and objectives earlier set out, the main aim is to explore
strategies, which can be adopted to curtail online game hacking through the
adoption of laws and legislations, particularly in the realm of intellectual
property, including laws on trademark, patents and copyright. The study also
seeks to fulfil four other objectives, namely, (i) to assess the impact of
hacking on online gaming, (ii) to explore various arguments posited by
hackers as to how and why they do what they do, (iii) to explore available
legal liabilities and remedies, including those relating to intellectual property
and copyright law and (iv) to prescribe the best legal means by which online
game hacking can be curtailed.
Given the objectives above, the research seeks to answer the following
question: “What is the impact of hacking on online gaming businesses and
what are the existing legal remedies, particularly the laws on intellectual
property, trademark, patents and copyright, which can curtail online game
hacking?”
To gain answers to the questions that allowed for the achievement of the

50
aims of this legal article, numerous online and offline primary and secondary
literature as provided in the preceding chapter were accessed to serve as
basis for the answers sought.
Likewise, this legal article will focus on the different laws and statutes, both
criminal and civil, focusing mainly on intellectual property statutes that apply
in online game hacking. The literature used in this legal article showed that
there are a number of laws that may be invoked by an online gaming
company in trying to bring hackers to justice. To be able to determine which
are best suited given the hacking situation, this legal article this legal article
identified and documented the laws applicable in several hacking situations
prevalent in the online gaming market today.
This legal article intends to provide accurate and complete selection of
applicable statutes, criminal laws and IP laws that can serve as guide to
online gaming companies in deciding whether a lawsuit would be the best
approach to take in going after hackers that caused them millions of dollars of
losses or even their business.
3.2 Participants and Sampling
This paper relied primarily on a number of primary sources such as laws,
statutes, legislations, jurisprudences and first hand information taken from
different online gaming companies. It also made use of various published
and peer-reviewed research work and other secondary sources such as

51
journals, books, studies, and many other literature available both online and
offline. As such, the population and sampling that are used are also based on
the mentioned published studies that likewise pertain to online game hacking.
Several case studies made on online game companies will likewise be
included to show the prevalence of hacking as well as its effect on these
companies.
Besides the secondary literature used, primary data research was likewise be
conducted. This was done using a self-administered questionnaire given out
to about 15 online gaming companies worldwide, both big and small. These
companies are the target audience of this legal article. The questionnaire
contained queries about online gaming in general and hacking in particular.
Most importantly, questions on the impact of hacking were also included.
These 15 random firms will serve as this legal article’s primary research
source. The data to be collected will serve as a representation of majority of
online gaming companies and the effect of hacking in their business.
3.3 Instrumentation
The secondary research based on case studies as well as the primary
research conducted both served as a study design that falls under a
qualitative analysis survey. The collected literature was made by reputable
experts in the field of online gaming and hacking, making the results as
accurate as possible. On the other hand, the survey questionnaire conducted

52
through highly esteemed and reputable online gaming firms were even more
precise, it being self-administered and data were collected first-hand.
This legal article made use of a questionnaire containing ten questions. Of the
ten, five of which based on the Likert scale, nine are multiple-choice
questions and one is an open-ended question. The questionnaire included
demographic questions that asked for the participant’s company name,
number of employees, location/s of business, years in business, etc.
A copy of this questionnaire is provided as Figure 3 of the Appendices. This
survey is used to gauge the prevalence of hacking among online gaming
companies as well as the impact of such a problem in the business. It also
contained questions that will determine what methods are preferred by said
companies to go after these hackers.
The Likert scale rates the answers provided in the questionnaire through five
scales, i.e., always, often, sometime, almost never and never. The data
provided in the survey will be collated then analysed. Through this scale,
questions are utilised and measured quantitatively in a research. It is a non-
comparative, single-dimensional and systematic scale used mainly in survey
questionnaires that allows respondents to choose from a set of or a selection
of statements that would align best to the participant’s choice or agreement.
In general, there are up to nine options to choose from in the Scale. However,
the more common scale make up only five options. The 5-point Scale is more
often used in research. It has on one end “strongly agree” and the other

53
“strongly disagree”. “Neutral” is in its middle point, which signifies that the
respondent is neither agreeable nor disagreeable with the question posed.
Some prefer to make use of the 9-point or at least the 7-point Scales to gain
extra granularity in their findings. There are other researchers to use even-
numbered scales or the 4-point Scale to be able to obtain a forced choice,
likewise referred to as “ipsative, quantity where the participant in the survey is
not provided a “neutral” option. This legal article will make use of the
common 5-point Likert Scale. A numeric value is given to each scale. The
starting value of each level is the numeral 1, increased by one in every level,
as shown below:50
3.3: Figure 1. An example of a scale commonly used in Likert scale questions
51
Likert Scales are likewise referred to as “summative scale” since all items in
the survey form may be replied with separately, or sum up everything all
relevant items in the survey to obtain a score for a group of statements.
Individual resplies are generally taken as “ordinal data” because though
replies have comparative ranks, there are possibilities of participant’s failing
50
S Jamieson, Likert Scales: How to (Ab)Use Them (Medical Education, 38, 2004) 1217-1218
51
Ibid.

54
to recognise the value difference between similar scales as equivalent.
In research, may have indeed considered the Likert Scale data collection as
interval data. However, this may be taken as an unsafe method for statistical
research since there is no guarantee that participants perceive the difference
between “agree” and “strongly agree” or between “neither agree nor disagree”
and “agree”.52
To cite the example from author Jamieson, imagine conducting a research
where opinions of PhD and Masteral students will be compared. Below is an
illustration indicating some sample questions that may be posed.
3.3: Source: Jamieson
53
In the next table, (Table 1), some raw data were provided by the same author
representing the responses of participants categorised according to whether
the student respondents are in their Masters or PhD level. This information
will then be used to relate to the statistics which will next be measured in the
next tables shown hereunder.
52
Ibid.
53
Ibid.

55
54
On figures 2, 3, 4 and 5 below, the information contained provided two types
of descriptive statistics that may be measured to obtain the data shown in
Table 1. In figures 2 and 3, what are shown are the mode, mean, range and
inter-quartile range of the collected raw data coming from the survey
performed. Table 2 contains the entire response level while table 3 further
classified the participants into two, i.e., PhD and Masters students. This
assists the researcher in the comparative analysis of the two groups.
54
Ibid.

56
55
Tables 4 and 5 will then contain the accumulated number of replies for each
level of each item in the Scale. Table 4 regards all replies in its entirety while
table 5 provides a distinction between Masters and PhD students.56
55
Ibid.
56
Ibid.

57
57
58
With the presentation of the system of how the Likert Scale function, it is now
easier for information acquired from the questionnaire to be interpreted and
understood. This is then applied in analysing the data collected. The
57
Ibid.
58
Ibid.

58
procedure for data collection is provided in the succeeding sub-heading.
3.4 Procedure
The literature review as well as the answers to the questionnaire served as
the data collected, selected, accumulated, organised, documented and coded
for a clearer and more comprehensive analysis of information. As regards the
procedure for the survey, it is based on the replies given by participants in the
questionnaire. The results from this qualitative research will thereafter be
analysed and interpreted where the conclusion will be partly based.
The findings from the study based on secondary data, will be grouped in
accordance to common themes from which results will be derived. This
includes the analysis of information taken from both types of research.
3.5 Validity and Reliability
In this legal article, validity is gained via the creation of a questionnaire that
will be used in a survey on online gaming companies perceived to be
representative of all tested areas. To be able to guarantee accurate random
sampling and credible results that would represent the majority, sufficient
samples are used in the survey.

59
The credibility of a qualitative research depends not only on the reliability of
data or the methods employed but also on the validity of results.59
It is
considered reliable if the degree of measures are accurate or without error. It
is also reliable if the results are consistent and if there is enough control that
will ensure findings warranted by gathered data. Additionally, a research is
considered reliable if what is observed can be used in generalising beyond
the situation. Should all these be present, both external and internal validity
are addressed. By definition, validity is a research instrument’s ability to
measure what is measurable.
In research, validity and reliability should be compared to get the most
accurate results.60
In the legal article, the two were attained through the
formulation of queries in the form of a questionnaire for the desired
information to be derived. The same with the secondary research conducted
where accurate and reputable studies were collated and analysed to arrive
with quality findings. Though it is hard to attain reliability with qualitative
methods of research, it can still be achieved if appropriate management of
contents, sequence and layout is in the questionnaire.
59
D Silverman, Interpreting Qualitative Data: Methods for Analysing Talk, Text and Interaction (2
nd
edition, London, Sage, 2001)
60
W Zikmund, Essentials of Marketing Research (USA, Thompson South-Western, 2003). Retrieved
from <http://books.google.com/books?id=xpz6YoS1_dAC&printsec=frontcover#v=onepage&q&f=false> on 3
December 2012

60
3.6 Limitations
The methodology employed made use of primary research based on data
gathered for random sampling from fifteen online gaming companies only
which may still not represent overall reflections of all online gaming
companies in relation to hacking. The study may likewise be seen as
demographically limited since many companies are from countries with strong
online gaming market only. Moreover, the feelings, opinions, situation and
beliefs of the respondents may not be considered enough to represent other
online game companies and others involved in the issue of hacking online
games. Finally, the reliance on secondary literature may present the risk of
misinterpretation, as data provided by those are not from a direct empirical
research.
It would be highly recommended that further study be conducted to gather
more information from more online gaming companies and their officials with
businesses located in countries that were not touched in the primary research
carried out. This will result to the acquisition of more representative data for
better evaluation of the impact of hacking in online games.
Chapter 4. DATA ANALYSIS
The sources and information gathered based on various literature and
references, from both primary and secondary sources were analysed

61
qualitatively through deduction method. Meanwhile, the data was gathered
from the participant survey, particularly online gaming companies involving an
interview with the use of a questionnaire, were likewise analysed. The survey
was conducted on an individual basis with the use of a semi-structured set of
queries. Generally, the questions provided were focused on hacking problems
in their online gaming companies and the solutions these companies perceive
to be effective in curtailing the mentioned hacking problems.
To show some results, of the 15 companies surveyed, seven believed in legal
remedies, five in simply upgrading and updating their safety measures and
protection of portals and servers and three wanted both remedies. The chart
below represents the results.
Legal
Remedies

Updated
Safeguards
and

Protection

Both

62
Also from the study, it was shown that majority of the companies surveyed
experienced hacking incidences. The bar chart below represents the findings.
Of these companies with hacking problems, 100% agreed that they
experienced profit loss over the harm made by the hackers.
Unfortunately, the survey also showed that while these companies believed in
putting in legal or safety measured to curtail the hacking incidences, majority
find their remedies ineffective. The chart below shows the results. The
reason for this however, does not necessarily mean that the legal solutions
implemented did not work but there are other factors that made it ineffective,
e.g., discontinuation of legal actions due to high cost, failure to identify the
hacker, etc.
0

2

4

6

8

10

12

14

With
hacking
problems
No
hacking
problems

Datenreihe1

63
The charts presented are just few of the results arrived. Basically, the survey,
as well as the literature and other sources showed that the problem of online
gaming hacking exists, is prevalent and needs to be curtailed.
Chapter 5. DISCUSSION AND INTERPRETATION OF FINDINGS
Based on both the primary and secondary data collected from various
literature and studies, as well as those taken from the survey conducted on a
number of online gaming companies, it is apparent that the problem of
hacking is prevalent and is causing harm to the companies, especially
profitwise.
It is also the result of the study held that while there are certain differences in
opinions, the companies are one in saying that hacking problems exists and
should be addressed. Some prefer to update and get improved security
systems and protective safeguards on their servers and portals while there
0
2
4
6
8
10

Effective

Ineffective

Datenreihe1

64
are those that believe that legal means are necessary to get the hackers to
justice for their actions.
Besides the findings shown in the preceding chapter, it was likewise shown
that while there are hackers that constantly abuse online game businesses,
there are also laws, both criminal and IP laws that online gaming companies
can make use of besides their protective software to fight against these
hackers and bring them to justice. However, some studies find these laws
insufficient or lacking. A call for a more stringent legislation is currently in the
offing. In the meantime however, and in my own opinion, these gaming
companies should show hackers an example by putting them behind bars
through various legal means.
Chapter 6. CONCLUSIONS AND RECOMMENDATIONS
6.1 Conclusions
To best present the conclusions derived at by this legal article, it would be
best to present the questions earlier posed and find out if those questions
were appropriately answered. To sum it up, an assessment of the impact of
online gaming hacking was made both through the gathering of secondary
and primary sources as well as from the collection of first-hand information
through a survey made on a few online game companies. Likewise, a
exploration of the various arguments presented by hackers on the reason

65
they do what they do. Literature would show that they presented many
reasons such as their right to free information. However, there are current
laws, which, whether they like it or not, will have to be abided. These laws
likewise give companies, which these hackers adversely affect, their rights to
intellectual property, which the law protects.
Upon assessment and analysis of these information and resources, the
research questions presented at the beginning of this legal article can now be
confidently and accurately answered.
On the questions, what is the current situation of online gaming in relation to
hacking and what are the adverse effects of hacking in online gaming, it was
shown that while this industry is thriving, hacking, particularly virtual items,
can do great harm to a business. It was likewise researched that hacking
online games is proliferating and has been experienced by many online
gaming companies especially big ones. Profit can be greatly affected by
these hacking activities and it can go as far as putting a company to
bankruptcy.
On the question, what are the arguments presented by hackers for what they
are doing, it was shown by literature that hackers have defence and
arguments that can be considered plausible and downright acceptable. They
have contended, inter alia, that information in the internet should be accessed
for free. However, just as they have rights, so do online game companies that

66
spend a big amount to develop and publish online games. Should hackers
cross the boundaries of law, then it is only apt that they answer for it.
As to the question on what the most significant IP and copyright laws that can
be used against online game hackers are and if they are sufficient to curtail
the acts of hackers, the literature review provided herein included a wealth of
knowledge on the laws and legislations available on how to curtail hacking
crimes depending on the type of deed. It goes without saying that various
criminal and IP laws may apply depending on the kind of act but what is
important is for online gaming companies to make sure they gauge all
requirements and costs entailed in going after a hacker through legal means
and should they decide to pursue, they should see though it till the end.
While there are many existing laws, both criminal and IP laws, that can be
applied to hacking crimes, it can still be considered insufficient and basically
at its infancy. However, moves to harmonise IP laws that can serve as
solution to computer crimes like hacking are already on its way as literature
would show.
6.2 Recommendations
It has been the purpose of this paper to explore the legal remedies that online
gaming companies may take to pursue hackers that harm their businesses,
particularly in the realm of IP and copyright. While said laws were
enumerated and presented herein, it can be said that difficulties could still be

67
faced by these companies given the universality of the problem. It is highly
possible that a case like this may involve several countries, thus the problem
of which law to take and which jurisdiction will handle. It is this author’s
recommendation therefore that online gaming companies first consider all the
pros and cons of filing a case against a hacker. All applicable laws against
the hacker should first be considered, the legal costs, the purpose of the filing
of the case, etc. For instance, if the purpose is to show these hackers a
lesson and serve as an example for future perpetrators, then the money to be
spent for legal actions would be worth it, even if it will cost more than simply
implementing more protection and safeguard on the servers and portals of the
gaming company. What is important, as previously mentioned, is to pursue
the case to the end or the hackers will simply do their deeds and know that
they will get away with it.

68
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75
Figure 3
Questionnaire
I am conducting a study that would investigate how online gaming companies feel
about hackers of in-game virtual items and what they intend to do about them. To that
end, would you mind completing the following interview questions? Your participa-
tion is truly appreciated.
Company Name:_______________ Name: ____________ Posi-
tion:________
Kindly choose the answer to the questions:
1. Have you experienced hacking problems? □Yes □No
2. Are these hacking problems causing loss of profit? □Yes □No
3. Have you taken measures to stop the hackers? □Yes □No
4. Are the measures taken, if any, effective? □Yes □No
5. What measures do you think should best be taken to solve the hacking prob-
lems?
Likert Scale Questionnaire:
1. Hackers are harming the profit of the company.
a. □ Strongly agree b. □ Agree c. □ Neutral d. □ Disagree e.□ Strongly
disagree
2. The number of hacking incidents in our company is high.
disagree

76
3. Legal means should be taken to curb the hacking problems.
disagree
4. There is no need for legal remedies, just extra protection of servers.
disagree
5. We have the intellectual property rights that can put hackers to jail.
disagree

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