Resident Evil versus unlicensed merchandise

Tremble as Halloween approaches!

For the occasion, you may have come across, while scrolling on your smartphone, ads for jumpers featuring Leon S. Kennedy or Nemesis, or decorated with the famous Umbrella Corporation logo from the survival horror saga Resident Evil. They look nice. And now that generative artificial intelligence (GenAI) has joined the party, they can be very easy to create. But are they legal? Not necessarily. And Capcom (the company that owns the franchise), like many other rights holders, has no intention of letting this unlicensed merchandising flourish. A recent case, targeting no fewer than 68 sellers, is a perfect illustration.

I. Unlicensed merchandise, the new face of infringement

Let us start by defining what we mean by “unlicensed merchandising”. The expression refers here to any product that commercially exploits, without the authorisation of the rights holders, the characters, names, logos or other distinctive elements of a well-known franchise. One Piece T-shirts, Zelda hoodies, Pokémon plushies, Minecraft posters, Umbrella Corporation beanies or phone cases featuring Nemesis: the sellers’ imagination knows no bounds. Legally, these are unauthorised exploitations that may amount to acts of infringement, whether of copyright or of trademark law.

And the phenomenon is far from marginal. In 2025, French customs removed 20.22 million counterfeit items from the market. Games, toys and sporting goods alone accounted for 65.21% of the items seized. French customs even explicitly cite Pokémon, Minecraft, One Piece and Lego among the franchises most popular with counterfeiters.¹

So, can you legally launch your own little collection of Resident Evil hoodies from your garage and sell it on marketplaces? Not without the permission of those who hold the necessary rights.

A fictional character, its graphic appearance, the illustrations depicting it, its name and the franchise logo may all fall under several intellectual property rights. Copyright prohibits, without consent, not only the reproduction of a protected work but also its adaptation or transformation². A sufficiently original character can itself enjoy this protection: the French Court of Cassation recognised this, for example, regarding Rahan, ruling that new adventures using the name and depiction of this original character could not be published without the consent of its creators³.

Trademarks may come on top of this. In France, using in the course of trade a sign identical to a trademark for identical goods is prohibited without authorisation; the same applies to an identical or similar sign where there is a likelihood of confusion. Trademarks with a reputation also enjoy special protection against certain uses that would take unfair advantage of their reputation⁴.

The right way to do it is therefore far less romantic: you need a licence.

The principle is simple. The rights holder remains the owner of its intellectual property but contractually authorises a third party to exploit it within certain limits. The French IP office (INPI) points out that a trademark owner can authorise a third party to use it in return for payment through a licence agreement. The World Intellectual Property Organization describes merchandising precisely as a form of licensing that allows a trademark, a protected creation or a character to be affixed to consumer goods⁵.

In practice, you do not simply ask Nintendo, Capcom or the rights holders of One Piece: “May I use your character?”. A licence specifies, among other things, which character or element may be exploited, on which products, in which territories, for how long and through which distribution channels. It may be exclusive or not, provide for a fixed fee, royalties or even a guaranteed minimum, and require the licensor’s prior approval of the products. This is how the classic character merchandising agreements described by WIPO work.

In other words, buying Resident Evil 3 does not give you the right to make clothes printed with the Umbrella Corporation logo.

Unlicensed merchandising is a real scourge for rights holders.

And it must be stressed that the rise of generative artificial intelligence only amplifies the phenomenon. Today, a few prompts are enough to produce, without any particular skill, dozens of visuals polished enough to end up on a T-shirt, a hoodie or a poster. On top of that, LLMs can explain the steps to follow to be as efficient as possible (there are of course safeguards, but they are easily circumvented).

Combined with print-on-demand and marketplaces, GenAI thus considerably lowers the barrier to entry: a single seller can quickly produce an entire catalogue inspired by popular franchises, without large stocks or any real creative infrastructure. But this new ease obviously changes nothing about the rights attached to the protected elements being exploited: generating the image yourself does not exempt you from obtaining the authorisation needed to exploit it commercially.

A distinction must still be drawn between reproducing a protected element and mere inspiration. Redrawing Nemesis in another pose or another style is not necessarily enough to escape infringement: changing the appearance of a creation does not automatically erase the rights that protect it⁶. On the other hand, Capcom cannot claim a monopoly on the general idea of a gigantic mutant monster chasing the player⁷. Copyright protects an original expression, not an idea, a genre or an archetype.

The line therefore becomes trickier with a “fake Nemesis”: a creature that does not reproduce the character exactly but borrows enough of its features to strongly evoke it. There is no mechanical rule here requiring a minimum number of differences. Everything depends on the elements actually borrowed and their originality. Changing a few details is no guarantee against infringement; drawing only on the general codes of the horror genre, by contrast, remains free⁸.

But identifying an infringement is only the first step: rights holders still have to manage to stop it effectively.

II. The rights holders’ response: Schedule A lawsuits

Rights holders obviously do not stand idly by. Several tools allow them to fight these unauthorised exploitations, from reporting an infringing listing to taking legal action, including customs intervention.

Online, rights holders can report infringing listings to platforms to have them removed. In Europe, the Digital Services Act requires platforms to provide a mechanism for reporting illegal content, goods or services⁹. Marketplaces must also collect various pieces of information to identify their professional sellers, including their name, address, contact details and certain information about their payment account¹⁰.

Rights holders can also act upstream with customs. In France, they can file an “application for action” to draw customs officers’ attention to their rights and to products likely to infringe them. When suspicious goods are intercepted, customs can then detain them for ten days to allow the rights holder to respond and, where appropriate, to take the steps needed to have them destroyed or to bring legal action.

But these mechanisms come up against the particular shape of online commerce. Having a listing removed does not necessarily prevent the seller from publishing another one. And when legal action is needed, you still have to identify who runs the shop, find out where they are, determine which court has jurisdiction and validly serve them with the proceedings. The problem becomes dizzying when dozens of sellers, sometimes on the other side of the world, are selling the same kinds of products at the same time.

It is precisely to address this difficulty that a rather unusual litigation practice has developed in the United States: “Schedule A lawsuits”. A rights holder sues, in one single action, dozens or even hundreds of online sellers, listed in an annex to the complaint called “Schedule A”. The practice has developed mainly before the federal court for the Northern District of Illinois, in Chicago. In a 2025 decision, Judge John Kness noted that thousands of such actions had been filed since the early 2010s¹¹.

The method is formidably effective. The case is often filed under seal and the rights holder can request, ex parte, that is, before the sellers have been heard, a Temporary Restraining Order (TRO). This can temporarily prohibit further sales and come with a request to provisionally freeze certain assets or with measures to obtain information quickly. By the time a seller discovers the lawsuit, their shop or their funds may therefore already be subject to interim measures. Many of these cases then end in a settlement or, when the seller never appears in court, in a default judgment.

Let us return, then, to that fabulous survival horror that is Resident Evil. On 29 May 2026, Capcom brought proceedings of this kind before the Northern District of Illinois against 68 defendants¹². The case targets online shops accused of selling unauthorised merchandise using Capcom’s trademarks and creations related to Resident Evil. The public documents available do not always make it possible to identify each infringing product precisely, but similar proceedings brought by Capcom concern clothing, accessories, posters, cosplay items, plushies, figurines and other goodies. The publisher alleges infringements under US trademark law, the Lanham Act, as well as under the Copyright Act. A few days later, Capcom requested a TRO including a temporary injunction, a provisional asset restraint and expedited discovery measures. Specialised databases tracking these proceedings identify the case as concerning the Resident Evil franchise.

Sixty-eight sellers, one single complaint: on paper, the technique seems perfectly suited to the problem posed by marketplaces. Rather than bringing as many separate proceedings against as many shops, the rights holder concentrates its resources in a single action. In a way, faced with infringement that has become industrial, the enforcement of rights is becoming industrial in turn.

Except that the American courts are now starting to put the brakes on precisely this logic.

That same day, 29 May 2026, the federal court of appeals with jurisdiction over Illinois handed down a decision set to seriously complicate Schedule A lawsuits. In Kangol LLC v. Hangzhou Chuanyue Silk, it addressed a very concrete question: how do you officially inform a Chinese seller that they are being sued before an American court? Until then, some plaintiffs had relied on simple notification by email. The court held, however, that where the Hague Service Convention applies¹³, this method is not sufficient in China: the methods of transmission provided for by the Convention must be followed.

There is, however, an exception where the defendant’s address is genuinely unknown. But the plaintiff cannot simply claim not to know it: it must show that it carried out sufficiently diligent searches to try to find it. In other words, the question of service must now be examined more closely, seller by seller, which considerably complicates proceedings involving dozens of defendants.

The immediate consequence in the Capcom case: Judge Kennelly considered that the validity of electronic service would now probably have to be examined seller by seller¹⁴. This mechanically raises the question of whether it is still reasonable to sue 68 of them at once. On 1 July 2026, he therefore decided that, for cases filed after Kangol, he would no longer allow more than 15 defendants to be joined in a single Schedule A case before him. Capcom had to go back to the drawing board.

The publisher complied and reduced its Schedule A from 68 to 15 sellers. On 7 July, the judge then granted the requested TRO, along with a measure allowing the future motion for a preliminary injunction to be served on the defendants electronically. The message is therefore not that Capcom cannot act against sellers suspected of infringement. Rather, it is that the effectiveness of the fight against counterfeiting does not exempt anyone from respecting the procedural safeguards owed to each defendant.

The movement goes well beyond this single case. On 11 August 2026, Chief Judge Virginia Kendall adopted specific rules for Schedule A lawsuits before her court. To obtain an ex parte TRO (that is, an emergency interim order issued before the defendant has been heard), the plaintiff must now provide individualised evidence for each defendant: a recent sale or offer for sale, the existence of immediate harm, the link between that seller and the alleged conduct, and the reasons for believing that prior notice would lead to the concealment of assets or evidence. To join several sellers, it is no longer enough to say that they all infringe the same franchise: the rights holder must provide evidence of the same series of transactions or of genuinely coordinated conduct. Mere screenshots of a shop accessible from Illinois are not enough, on their own, to establish the court’s jurisdiction either.

A few months earlier, Judge John Kness had summed up the whole difficulty: the costs of counterfeiting are real and it is extremely difficult to combat with traditional judicial tools, but that does not justify “bending” the rules of procedure and the principles of due process to make prosecution more convenient.

This is the whole paradox of unlicensed merchandising in the age of marketplaces. The internet has fragmented counterfeiting across a multitude of small shops; rights holders have responded by trying to group these sellers together in mass litigation. The Resident Evil case now shows the limits of this race for efficiency: fighting on a large scale, yes, but without turning 68 defendants into a single one.

Notes

1. French Directorate-General of Customs and Excise (DGDDI), Bilan de la Douane française 2025, 19 Feb. 2026, section “La douane lutte contre les contrefaçons” ↩

2. Article L. 122-4 of the French Intellectual Property Code ↩

3. French Court of Cassation, 1st civil chamber, 19 December 1983, No. 82-14.597, published in the Bulletin ↩

4. Article L. 713-2 of the French Intellectual Property Code ↩

5. WIPO, “Assignment and licensing” (link) ↩

6. French Court of Cassation, 1st civil chamber, 19 December 1983, No. 82-14.597, published in the Bulletin ↩

7. French Court of Cassation, 16 January 2013, appeal No. 12-13.027 ↩

8. French Court of Cassation, 6 January 2021, appeal No. 19-20.758 ↩

9. Article 16 of the Digital Services Act (Regulation (EU) 2022/2065) ↩

10. Article 30 of Regulation (EU) 2022/2065 ↩

11. Eicher Motors Limited v. The Individuals, Corporations, Limited Liability Companies, Partnerships, and Unincorporated Associations Identified on Schedule A Hereto, 1:2025cv02937 - Document 22 (N.D. Ill. 2025) ↩

12. Capcom Co., Ltd. v. The Partnerships and Unincorporated Associations Identified On Schedule A ↩

13. Hague Convention of 15 November 1965 on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, Art. 1 ↩

14. U.S. District Court for the Northern District of Illinois, Capcom Co., Ltd. v. The Partnerships and Unincorporated Associations Identified on Schedule A, No. 1:26-cv-06323, minute order of 14 June 2026 ↩

Faris MELAHILawyer in intellectual property and audiovisual law, certified DPO

https://lexludica.com/en/articles/resident-evil-unlicensed-merchandise