Universal City Studios vs. Nintendo Lawsuit
Universal City Studios, Inc. vs Nintendo was a lawsuit filed by Universal City Studios against Nintendo regarding trademark infringement. The worldwide success of Donkey Kong drew the attention of Sid Sheinberg a seasoned lawyer and President of Universal City Studios. Sid Sheinberg suspected that the game might be a trademark infringement of Universal’s film King Kong.
In April of 1982 Sheinberg met with Coleco whom licensed Donkey Kong from Nintendo for home game console distribution. Sheinberg threatened to sue over Coleco’s home version of Donkey Kong which was released on multiple consoles. After further review in May of 1982 Coleco agreed to pay royalties of 3% of their Donkey Kong net sale price to Universal which was worth approximately $4.6 million.
Universal then turned its focus to Nintendo threatening to sue but Howard Lincoln Nintendo’s attorney stood his ground refusing to give in to Universal’s demands. Universal brought Nintendo to court on June 29, 1982 and announced its license with Coleco. Universal’s counsel argued that the names King Kong and Donkey Kong were easily confused and that the game’s story infringed on their film.
|Court||U.S. District Court, Southern District of New York|
|Filed||June 29, 1982|
|Decided||August 8, 1983|
|Decision||In Favour of Nintendo|
|Terms||Universal City Studios to pay damages and attorney fees|
Nintendo’s counsel, John Kirby countered that Universal had themselves argued in a previous case that King Kong was in the public domain. He argued that Universal did not own the rights to the King Kong characters and that Universal themselves had successfully sued RKO Pictures in 1975 in Universal City Studios vs RKO General, inc., where they proved that the plot of king Kong was in the public domain. The successful outcome of the 1975 lawsuit opened the door for Dino De Laurentiis’ 1976 King Kong remake.
The judge declared that Universal City Studios did not own the rights to King Kong and that they were fully aware that they did not have rights to the character base on the results of the RKO litigation. In the end judgment was given in favor of Nintendo and Universal was ordered to pay damages and attorney fees.
Universal appealed the verdict to the United States Court of Appeals for the Second Circuit, arguing their case on May 23, 1984. Universal continued to argue that there was consumer confusion between the two properties. The court came to a decision on October 4, 1984 deciding to uphold the previous verdict. The court declared that the two properties were not alike and that it would be unlikely to cause any type of consumer confusion. The court elaborated stating that the word “Kong” in King Kong’s name was a widely used term by the general public for apes and other objects of enormous proportions.
Nintendo filed counterclaims on May 20, 1985 in which the court ruled that Universal City Studios would have to pay Nintendo $1.8 million for legal fees and lost revenues. Coleco along with other Nintendo licensees of the Donkey Kong property filed their own counterclaims against Universal who prior to the outcome of the lawsuit against Nintendo sought payment from Nintendo’s licensees for royalties. Universal City Studio was sued by the Donkey Kong licensees to recover the revenues they paid in royalties for a license to King Kong that Universal City Studios did not own.
Nintendo thanked their attorney John Kirby by gifting him a $30,000 sailboat christened the “Donkey Kong” and provided him with worldwide exclusive rights to use the property for sailboats. Nintendo also showed their appreciation to John Kirby by naming the led character in the Kirby series after John Kirby, in honor of his service in the Donkey Kong case.