However, in recent years, and particularly in the aftermath of the
unprecedented financial and critical success of the Films, defendants have, with
increasing boldness, engaged in a continuing and escalating pattern of usurping
rights to which they are not entitled — rights which belong exclusively to plaintiffs.
For example, although their limited merchandising license only gives them the right
to sell tangible merchandise, defendants have developed, licensed and/or sold (and
continue to develop, license and/or sell) downloadable video games based on The
Lord of the Rings and The Hobbit, available only by downloading and/or access via
the Internet, via mobile apps, tablet apps or other similar digital distribution
channels, or through other online interconnectivity such as Facebook. There is no
physical or tangible item of merchandise sold to the consumer with these games.