FBI shut down the unauthorized computer game server L2Extreme, which hosted the NCSoft MMORPG Lineage II. Owners of L2Extreme provided its 50,000 active users with service and code for the online game for a fee. NCSoft claimed millions of dollars of annual loss due to this illegal service. L2Extreme operated pirated server software copied from the NCSoft server software. Users then registered with L2Extreme to play Lineage II instead of using NCSoft’s servers.

The financial effect is of course significant, but NCSoft also had to defend its intellectual property rights. The case, at first glance, is similar to the Blizzard v. BnetD case. However, BnetD reverse engineered the Blizzard server software without direct infringement on the original software. It was a fair use copy with no copyright violation involved. Contrarily, L2Extreme simply pirated the software from NCSoft. In addition, L2Extreme was a profitable business whereas BnetD was fueled by volunteer game enthusiasts. Otherwise, the details of both cases seem very similar.

Comparing the Blizzard v. BnetD case with this event, it becomes clear that seemingly minor details are in fact the deciding factors in many copyright decisions. In one, the FBI abruptly closed down operation without proper legal decision whereas in the other, the original game company could not persuade the court of any wrongdoing on the defendant’s part. Noticeably, intellectual property laws and their applications to the game industry remains a relatively new field. Hence, it is difficult to pinpoint what is right and what is wrong. Perhaps the single greatest law which many intellectual property and gaming related cases are based on is the Digital Millennium Copyright Act. However, there are many critics of the DMCA simply because of some of the consequences of invoking the Act. It remains to be seen how long the DMCA can last before undergoing major renovations. Much of that is derived from the evolutionary nature of gaming, where much change can occur in just a few years. Laws that are applicable in one year may become outdated the next year. This is the inevitable change of technology.

In this article, Schwarz and Bullis discussed the effects and consequences of intellectual property law on online gaming. In online multiplayer games, players collect cash and points through game play. This cash, applicable only in the game, can be traded for objects within the game that might improve the character’s ability or collection items. However, there are now markets outside the game in real life that trade this type of game currency in exchange for real currency. At first glance, the concept seems fair enough: trade different types of monies at rates that satisfy both ends. Yet, virtual currency, and for that matter, all characters, game plays, and settings, belong to the owner of the game server and software. Does the owner of the server own the currency too, or do players who play the game and gain the cash actually “own” the cash?

One must wonder how ownership should be defined in the context of Massive Multiplayer Online Role Playing Games (MMORPG). When one purchases a book, one may legally resell it. This type of ownership does not apply for digital music downloads. Does it apply for virtual currency and fantasy goods? Companies owning the games have formally banned the secondary market of real-world money trading, primarily to retain control of the game characters and also to avoid detraction from the game experience. If real money can be exchanged for aptitude in the virtual game, then the quality of gaming at its essence, where "skilled" players accomplish the most, diminishes.

The authors concluded that virtual goods and currency should be compared to the reselling of books rather than to the distribution of downloaded music. They argued that even though these goods do not exist outside of the online game, they are still goods that are traded from one person to another. When one player sells a sword to another, that player no longer holds the sword. However, digital files such as music can be duplicated infinitely and the original holder still retains one copy. Further, a physical CD of music can be resold because the original owner no longer owns that physical CD. Thus, whether goods are digital, virtual, or real was irrelevant in this discussion. According to Schwarz and Bullis, the tangible and physical nature of the good was the defining and determining characteristic of property.