Bots, Warden, and the Two Halves of § 1201: MDY Industries v. Blizzard

The Ninth Circuit split the DMCA's anti-circumvention provisions in two, holding that § 1201(a) protects access independently of infringement — and that a World of Warcraft cheat maker violated it.

In MDY Industries, LLC v. Blizzard Entertainment, Inc., 629 F.3d 928 (9th Cir.), Nos. 09-15932 and 09-16044, decided December 14, 2010 (opinion amended February 17, 2011), the U.S. Court of Appeals for the Ninth Circuit untangled two questions that copyright lawyers had long run together: when does breaking a software license become copyright infringement, and when does defeating a technological lock violate the Digital Millennium Copyright Act? The vehicle was a fight over World of Warcraft — the massively multiplayer game then at the height of its popularity — and a piece of software called Glider that let players cheat their way up the early levels while they slept.

At a glance

Court and date: U.S. Court of Appeals for the Ninth Circuit; decided December 14, 2010, amended February 17, 2011; docket Nos. 09-15932, 09-16044 (on appeal from the District of Arizona).
Secondary infringement: Reversed. Violating a license covenant (as opposed to a condition) is a breach of contract, not copyright infringement, unless the violated term has a nexus to one of the copyright owner’s exclusive rights. Glider users breached the terms of use but did not infringe.
DMCA § 1201(a)(2): Affirmed in part. MDY was liable for trafficking in a device that circumvented Blizzard’s “Warden” system, but only as to the game’s dynamic non-literal elements — the real-time audiovisual experience streamed from Blizzard’s servers.
DMCA § 1201(b)(1): Reversed. Warden did not protect any right under the Copyright Act, so MDY was not liable under the copy-control provision.
The doctrinal headline: The court read § 1201(a) and § 1201(b) as distinct rights and expressly declined to follow the Federal Circuit’s Chamberlain v. Skylink infringement-nexus requirement.

How the case arose

Blizzard operated World of Warcraft under a software license — an End User License Agreement and Terms of Use — that prohibited the use of bots and automated play. MDY, founded by Michael Donnelly, developed and sold Glider, a program that automated the repetitive grind of leveling a character, letting users advance without sitting at the keyboard. Glider sold by the tens of thousands.

Blizzard responded with technology of its own: a program called Warden that scanned a player’s computer for unauthorized third-party software at the moment of connection and while the game ran. When Warden began detecting Glider, MDY engineered Glider to evade it. Blizzard’s legal theory followed naturally — that MDY was secondarily liable for the copyright infringement of Glider’s users and that Glider was an unlawful circumvention device under § 1201. The District of Arizona (Judge David G. Campbell) largely agreed, granting summary judgment to Blizzard on contributory and vicarious infringement and on the DMCA claims, and finding tortious interference. MDY appealed.

Covenants versus conditions: keeping contract claims out of copyright

The first half of the opinion is a master class in license interpretation. When a licensee exceeds the scope of a license, the consequences depend on whether the broken term is a condition (a limit on the grant of rights, the violation of which means the use is unlicensed and therefore infringing) or a covenant (a contractual promise, the violation of which is merely a breach of contract). The Ninth Circuit held that for breach of a license term to give rise to copyright infringement, “there must be a nexus between the condition and the licensor’s exclusive rights of copyright.”

Applying that test, the court concluded that Blizzard’s anti-bot rules were covenants, not conditions tied to the reproduction, distribution, or derivative-work rights. Loading the game into RAM to play it was authorized; using a bot while doing so did not transform that authorized copying into infringement. Because the underlying users were not infringers, MDY could not be secondarily liable for infringement. The judgment on contributory and vicarious copyright infringement was reversed. The practical effect was significant: Blizzard’s grievance against Glider sounded in contract and tort, not in the reproduction right.

Splitting § 1201 into access and copy controls

The opinion’s lasting contribution is structural. The court read the DMCA’s anti-circumvention scheme as creating two separate rights. Section 1201(a) prohibits circumventing — and trafficking in tools that circumvent — measures that control access to a copyrighted work. Section 1201(b) prohibits trafficking in tools that circumvent measures protecting a right of the copyright owner — that is, copy controls. The court emphasized that Congress wrote the two provisions in deliberately different language, and that § 1201(a) therefore establishes a new anti-circumvention right against breaching access controls that is independent of whether any infringement follows.

That reading put the Ninth Circuit squarely at odds with the Federal Circuit. In Chamberlain Group v. Skylink, the Federal Circuit had held that a § 1201(a)(2) plaintiff must show a nexus between circumvention and infringement. The MDY panel rejected that gloss, reasoning that importing an infringement requirement into § 1201(a) would ignore the statute’s text and erase the distinction Congress drew between access controls and copy controls. The disagreement remains one of the defining circuit splits in DMCA law.

Applying its framework, the court parsed World of Warcraft into components. The game’s literal code and the individual non-literal elements — art, sound, and the like — sat on the player’s own hard drive; a user could reach those without Warden’s permission, so Warden did not “effectively control access” to them. But the game’s dynamic non-literal elements — the live, server-driven experience of the game world as it unfolds in real time — could be accessed only by connecting to Blizzard’s servers, and Warden controlled that gateway. As to those dynamic elements, MDY had trafficked in a circumvention device and was liable under § 1201(a)(2).

Section 1201(b) came out the other way. Because Warden did not prevent copying or otherwise protect a right granted by the Copyright Act — it gated live access, not reproduction — MDY incurred no liability under the copy-control provision.

Open questions

Will the split be resolved? MDY and Chamberlain still point in opposite directions on whether § 1201(a) requires an infringement nexus, and the Supreme Court has not stepped in.
What counts as an “access” control today? The “dynamic non-literal elements” theory maps cleanly onto streamed games and live services, but its application to modern cloud software, subscription DRM, and always-online devices is still being worked out.
How far does the covenant/condition line stretch? MDY keeps many license violations in contract rather than copyright, but drafting choices can convert covenants into conditions, and courts continue to police where the line falls.

Implications

For platform and game operators: Anti-circumvention exposure for cheat and bot makers is real under § 1201(a) in the Ninth Circuit — even when the underlying users are not themselves infringers.
For software licensors: Whether a restriction is a condition or a covenant can decide if a violation yields powerful copyright remedies or merely contract damages; drafting matters.
For circumvention-tool developers: The access/copy distinction means liability can attach to defeating a gatekeeper even where no copying occurs.
For the broader § 1201 debate: MDY’s independent-access-right reading is the principal counterweight to Chamberlain, and forum choice can be decisive.

Frequently asked questions

Did World of Warcraft players break the law by using Glider? Not copyright law, in the Ninth Circuit’s view. Using the bot violated Blizzard’s terms of use, but the court held those terms were covenants rather than conditions tied to an exclusive right, so the players breached a contract rather than infringed a copyright.

Why was MDY liable under § 1201(a) but not § 1201(b)? Section 1201(a) protects measures that control access to a work, and Warden gated access to the game’s live, server-driven elements. Section 1201(b) protects measures that guard a copyright owner’s rights, such as against copying — and Warden did not prevent copying, so the copy-control claim failed.

How does MDY differ from Chamberlain v. Skylink? Chamberlain (Federal Circuit) requires a § 1201(a)(2) plaintiff to prove a nexus between circumvention and infringement. MDY (Ninth Circuit) rejected that requirement, holding that § 1201(a) creates a stand-alone right against circumventing access controls regardless of any infringement.