Monday, December 26, 2011

Making Merchandise from Video Game Characters

Dear Rich: For a while I have been making digital merchandise based off of famous movie and video game characters. At first I wasn't really making any money off of them. I know now that not making a profit doesn't change anything as far as trademark violations, but I thought it did before, so I stopped selling the merchandise a while ago because I had started making real money and didn't want to make money off of other people's creations without their permission. But now, after so many months, I find myself still wanting to make and sell that merchandise, and other people are asking me to as well. Its a bit frustrating, because I see other people creating things based off of trademarked characters, both in my market and in other markets on the internet. Like all of the Star Trek merchandise you see on Etsy. What's the likelihood of a small one-person business like me getting permission to create merchandise like this? If it's possible, how do I do it?  The likelihood of getting permission is very slim. Owners of video game characters usually only deal with established merchandisers (with serious sales voodoo). Also, they often enter into exclusive licenses. That means they can't grant permission to you without violating their license with someone else. It's possible that if you were offering a new product category, you might have a chance. But that's tough to pull off. (PS. Here's the lowdown on trademark licensing.)
How do other people get away with it? It's a matter of odds. The owners of valuable character properties usually put their resources into pursuing the bigger fish, and for the most part, that often bypasses individual sales at Etsy or eBay. So, unless the trademark owner is intending to make an example of a small fry infringer, a cease and desist letter may be sent, and that's sometimes the end of it.
What should you do? We wish it wasn't frustrating to get permission. Like, wouldn't it be great if you could pay "per impression" for reproductions of licensed characters.  Of course, that may blow any standards of quality ... but hey, merchandise happens. Anyway, infringement is always a gamble and we'll leave the risk assessment to you.