Judge William Smith’s 25-page opinion issued Friday settles a beef that had pitted toy developer Reuben Klamer, TV celebrity Art Linkletter and Hasbro against Klamer’s former business partner Bill Markham.
Markham’s heirs were seeking to acquire the copyright that Klamer licensed to the Milton Bradley Co., which is now owned by Hasbro, in 1959. Smith flew to Los Angeles during a bench trial to take live testimony from Klamer, now 96, and two former employees of Markham who created the game prototype and its initial rules and box cover.
“Like the Game of Life itself, this fifty-nine-year tug-of-war for renown and royalties has followed a long, circuitous path,” Smith wrote. His conclusion is styled in Game of Life parlance as the parties’ “Day of Reckoning.” The result: Markham’s heirs cannot ascend to “millionaire acres.”
Markham Concepts v. Hasbro is a win for Lathrop Gage partner Erica Van Loon, who represented Klamer along with Patricia Glaser of Glaser Weil Fink Howard Avchen & Shapiro.
Van Loon said Smith was eager to hear directly from Klamer and Markham’s two employees, Grace Chambers and Leonard Israel, who are also in their 90s and live in California. So he scheduled their testimony while on a visit to Pasadena, California to sit by designation at the Ninth Circuit.
“He said ‘I’m coming to Los Angeles and I really want to hear live testimony from these witnesses,’” Van Loon said. The judge and his clerk arranged to borrow a courtroom in the Central District of California’s First Street courthouse.
“Just being able to hear them live and not by video, I think made a tremendous difference in the case,” Van Loon said.
Smith wrote that he found Chambers and Israel, who had no financial interest in the outcome, especially credible and that Klamer corroborated their testimony.
Smith found that Klamer and Markham contributed the big ideas, such as the game being played on a circuitous path with three-dimensional objects. Chambers, Israel and Markham’s wife, Sue, created the game’s physical prototype. The work was performed “at the instance and expense” of Klamer, Smith found.
Klamer, Markham and Linkletter then pitched Milton Bradley executives on the game at Chasen’s restaurant in West Hollywood in August 1959. The deal was sealed a few months later, when a company owned by Klamer and Linkletter licensed the game to Milton Bradley for a 6 percent royalty on sales, while Markham in turn accepted a 30 percent share of those payments.
“The Game, an instant classic, sold like crazy, and is still a source of revenue for Milton Bradley’s successor-in-interest Hasbro,” Smith wrote. “The ensuing ‘Pay Day!’ has sometimes been the cause of consternation, however.”
Within a few years, Markham was complaining to Klamer that his share was “ridiculously low” and that Linkletter hadn’t fulfilled his obligations to promote the game. Klamer replied that the deal “was and is a fair one,” but agreed to pay Markham 50 percent of the royalties on overseas sales. The two ended up litigating the issue of foreign sales in the 1980s.
Markham died in 1993. His heirs sued in 2015, invoking a provision of the Copyright Act of 1976 that allows authors to terminate licenses after 56 years in certain circumstances.
But that provision excludes works for hire, and Smith concluded that the Game of Life is a work for hire that was commissioned by Klamer and produced by Markham’s company. “The weight of the evidence in this case is that the success that met the Game of Life was, in fact, nothing if not the result of collective effort,” Smith concluded. “And although the credit, in the colloquial sense, can be split pro rata, the law dictates that the copyrights cannot be.”
Holland & Knight represented Hasbro while Thompson Coburn and Hinckley, Allen & Snyder represented Linkletter’s heirs and successors-in-interest.
Van Loon said her client is pleased that the decades-long dispute can now be put to rest. “I think Reuben has some peace now,” she said.