© 2016 The Texas Lawbook.
By Rogge Dunn
The international craze over “Pokémon Go” since its July 6 release has led more people to download the popular video game than any other in history. Although the melding of an online virtual reality with the real-life world has captured the attention of millions globally, the game itself presents some interesting and potentially thorny liability issues for employers.
This is essentially the same model as the original online “Pokémon” game that debuted 20 years ago and was played exclusively in a prefabricated online world. However, the new version takes place in the real world by relying on the latest advances in GPS and virtual reality technology. And therein lies the rub.
By overlaying a video game with the physical world, “Pokémon Go” creates a variety of situations in which companies may face legal action from game players as well as employees. The game’s owners, Japan-based Nintendo Ltd. and The Pokémon Company, have shielded themselves from lawsuits by requiring forced arbitration for any disputes arising from those who download the game. However, there are no such protections for unaffiliated companies that are dealing with all the existing and potential headaches caused by “Pokémon Go” and its players.
Data Breach Concerns
Perhaps the biggest threat for businesses can be found among employees themselves. Many companies that provide smartphones for employees or those who encourage employees to use their own mobile devices for work have the greatest risk because of the growing questions about how “Pokémon Go” may expose private information.
Only five days after the game’s release, the company that developed “Pokémon Go” acknowledged that it was able to access all the information on users’ Google accounts, including their email, if they signed up for the game using their Google passwords. Although an update has been promised to prevent this data breach, the fact that it exists in the first place should be a red flag for most companies.
The safest policy would be to prohibit employees from downloading the game on any device used for work purposes. At the very least, there should be a requirement that employees install company-approved encryption software to guard against the unauthorized release of emails or other private business information.
The fear over this apparent flaw has led Germany’s largest consumer advocate group to call for the company that controls “Pokémon Go” operations to revise its terms and privacy policy in order to conform to existing German laws. A lawsuit has been promised if the company refuses.
Business Interruption and Production Loss
The excitement over “Pokémon Go” has led droves of people to descend on various locations in search of game characters, and the resulting frenzy has already caused some businesses to suffer. While higher foot traffic is welcomed by some companies with goods to sell, it creates havoc for others.
A recent example comes from the small town of Newnan, Ga., where city officials have prohibited the game from being played at any of the town’s three local cemeteries after more than 50 people showed and ran through gravesites in search of “Pokémon Go” quarry.
While likely not as serious as losing revenue for hours while trying to clear your facility of “Pokémon Go” players in favor of paying customers, another damaging facet is the potential loss of production among employees who may be playing the game when they should be doing their jobs. Not unlike those who did and still may be wasting company time on Facebook, employees who become caught up in “Pokémon Go” may well spend more time trying to capture their next virtual character than doing what they are paid to do.
Although some see the game as a potential team-building exercise, companies that want to eliminate lost time spent on “Pokémon Go” may be best served by not allowing employees to play the game at work altogether.
Personal Injuries
Building managers and facility directors may face the most daunting role in the “Pokémon Go” story when it comes to legal liability. Since the game characters apparently can be located nearly anywhere – including parking lots, break rooms or broom closets – it is crucial that companies make sure that their publicly accessible buildings and other areas do not contain hazards that may lead to injuries.
Indeed, depending on the situation and seriousness of the injury, a property owner or business could be held liable. A good example comes from a 1975 scavenger hunt where a Los Angeles radio station offered a cash prize to the first listener who could find one of the station’s disc jockeys as he drove around the city. Two drivers pursuing the DJ were involved in a wreck that killed one of them. After the victim’s family successfully sued the station for negligence, the California Supreme Court upheld a $300,000 judgment.
Now imagine the scenario in which a “Pokémon Go” character appears in a company warehouse atop a secluded stairwell that no one uses because there are no handrails. If that same stairwell is accessible to the public and a player falls while trying to catch the character, guess who they will say is liable? Such a claim might eventually be defeated in court, but the defendant company is still forced to decide whether to pay a settlement or mount a potentially costly legal defense.
The same principal applies when it comes to employees who are playing the game while on the job. If a company’s policies on smartphones and other electronic devices allow employees to play online games during working hours, then it will be difficult or impossible to determine whether the guy in accounting fell out of the parking garage because he was preoccupied with year-end financials or if he was chasing a “Pokémon Go” character. Allowing employees to play “Pokémon Go” or any online game while they are being paid to work is a bad idea on several levels.
Moving Forward
The focus on “Pokémon Go” is just the latest in a long list of pop culture distractions that have infiltrated our country’s workspaces for decades – from transistor radios in the 1950s to Microsoft’s ubiquitous “Minesweeper” game in the 1990s to the debut of Facebook in the early 2000s. While the negative impact of those examples is tied primarily to employee production, “Pokémon Go” has literally (and virtually) created a new playing field that opens the door to legal liability for companies in unique and potentially very damaging ways.
Although the game may lose its luster over time, there is no question about its current popularity and its potential to remain so for some time. That is why smart companies will address this issue with new policies and procedures that account for the issues described here and the many others that are likely to emerge as “Pokémon Go” continues to be tested by players, online hackers and others.
Rogge Dunn of Dallas’ Clouse Dunn LLP is an experienced attorney who represents business clients and C-suite executives in employment law matters across the U.S. and internationally. He is Board Certified in both Civil Trial Law and Labor and Employment Law by the Texas Board of Legal Specialization.
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