This previously-recorded episode of The Commute covers some of the darker issues to come to light of the recent Blizzard v. Valve "DOTA" lawsuit. I've been meaning to write a longer article about the diminished state of the mod scene. I've written on the law governing mods and how they've caused a lot of these headaches. A longstanding problem is that the early court cases governing mods came at a time when programmers' ability to alter the gameplay experience was extremely limited (such as speeding up the on-screen action.) There obviously wasn't much "creative expression" possible in these first mods, and the courts didn't really consider that idea. Consequently, modders still don't have any real legal right to mod or any ownership in their work and are potentially at the mercy of what developers allow.
I've argued that it would be more consistent for courts to view mods the same way that they view "cover" songs, which are specifically permitted by compulsory licensing under the Copyright Act and allow professional musicians to experiment with their own interpretations of an underlying composition. (Gamepolitics picked up on this suggestion after it was published, and the type of "aspiring-professional-modder" licensing scheme I proposed anticipated a lot of the key features of Epic's current licensing scheme for the Unreal Development Kit (which, after a fairly recent change, doesn't charge developers until their game hits $50,000 in sales).
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