Fan Games, Cover Songs, and Copyright Law – Legal Limits and Liability for Derivative Works

This article is a contribution by Attorney Sanghoon Kim of Choi & Lee Law Firm. If you would like to share quality content for startups in the form of a contribution, please contact the Venture Square editorial team at editor@venturesquare.net.

Recently, there has been a continuing online debate over whether fan-made games and cover songs infringe on the rights of their creators. While these creations may originate from simple fandom, once enjoyed and shared by hundreds of thousands, they no longer remain a personal hobby and can lead to legal liability issues. Today, we'll examine the meaning and legal limitations of derivative works under copyright law, focusing on examples of these fan games and cover songs.

1. How a fan game, born from love, became controversial.

Fan games often stem from a deep affection for a particular game. Fans often unofficially create homages or imitations of existing popular games, distributing them for free within their communities. While initially seemingly a simple hobby, fan games can gain popularity, racking up hundreds of thousands of downloads and incorporating the original characters, music, and graphics. In some cases, the original creators have granted conditional permission to distribute the fan games, promising "non-commercial, free distribution." However, these fan games have since escalated into copyright infringement controversies, with the unauthorized inclusion of various K-pop and animation music. Ultimately, even the result of a passionate fandom can lead to legal disputes when numerous works are bundled together and distributed without the permission of the original creators.

2. Cover Songs: Simple Reinterpretations of Songs or Copyright Infringement?

One of the most common forms of fan creation is the cover song. While arranging or re-performing an original song is often considered "creation," under copyright law, it is considered a derivative work based on the original work. Copyright law grants the original creator the exclusive right to control the creation and use of new works based on their work. Therefore, re-performing and publicly using a song without the original creator's consent is, in principle, a copyright infringement. Simply re-performing a song does not extinguish the original creator's rights, and cover songs also require the original creator's permission. In particular, when a cover song is included in a fan game, it can be considered a derivative work with substantial similarity to the original work, and including and distributing it without the copyright holder's consent can lead to copyright infringement.

3. Why are the covers different, even if they are the same, between simple uploads and game content?

Many people question the sheer number of cover videos on YouTube, asking, "So, isn't that all illegal?" However, there's a significant legal difference between simply uploading a video and including music in a game. Platforms like YouTube have contracts with the Korea Music Copyright Association, allowing cover videos within a certain scope. Fan games, on the other hand, insert the audio files directly into the game folder for download, making them not simply video posting, but rather "copying" and "distribution." This clearly violates Article 16 of the Copyright Act's right of reproduction and Article 20 of the right of distribution. Especially when downloads reach hundreds of thousands, the "private use" exception, which presupposes personal, non-commercial use, becomes inapplicable. Consequently, even if the distribution is free, anyone who distributes copyrighted material in a format accessible to an unspecified number of people cannot avoid copyright infringement liability.

4. What Liability Will Be Enforced If Copyright Infringement Is Found?

Copyright infringement doesn't end with mere accusations. Civilly, copyright owners can seek damages from infringers and demand the return of unjust enrichment. The more downloads a work receives, the greater the potential for damages. Furthermore, criminal liability can arise. Article 136 of the Copyright Act stipulates that copyright infringers are subject to imprisonment for up to five years or a fine of up to 50 million won. Beyond simply private personal enjoyment, distributing copyrighted works to an unspecified number of people carries a significant risk of criminal punishment. Indeed, numerous cases have already resulted in convictions for unauthorized distribution of music files.

5. Fandom Creation: Where Does Freedom Begin and Where Does Violation Begin?

This controversy isn't limited to a specific game, but rather highlights the legal boundaries of fandom creative culture, which are likely to recur in the future. While fans' spontaneous creative activities hold significant cultural significance, the creators' rights must also be respected. Free distribution alone cannot exempt them from legal liability, and publicly distributing creative works without the original creator's permission can always lead to legal disputes. Ultimately, both creators and fans must understand the fundamental structure of copyright law and continue to create within its permitted scope. We must remember that this is the only way to protect the rights of original creators while fostering the healthy growth of fandom culture.


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