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Bahrain Files Esports Dispute to the TAS/CAS

In a recent development that has captured the attention of the legal community, the Bahrain Esports Federation (BESF) has formally appealed to the Court of Arbitration for Sport (CAS) over a contentious refereeing decision during the Asian Games. This decision allegedly deprived the Bahrain team of a medal in the EA Sports FC Online event.

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Background of the Controversy

Bahrain’s Abdulaziz Abdullatif Faqeehi had progressed to the second round of the winner’s bracket in the EA Sports FC Online event. He faced South Korea’s Kwak Jun-hyok in a best-of-three format. After winning the first game, losing the second, and emerging victorious in the decider, Faqeehi seemed poised to secure a medal for Bahrain. However, following concerns raised by Kwak regarding the second game, a re-match for the third game was unexpectedly called by the technical official.

The BESF has pinpointed the referee’s absence during this match as the primary cause of the ensuing confusion at the China Hangzhou Esports Center. The federation’s statement elucidated,

“This unexpected turn of events left the Bahrain team profoundly bewildered, as no transparent rationale was provided for this decision.”

Legal Implications

The BESF has emphasized that the decision to have a rematch was in direct violation of the regulations set by both the Asian Esports Federation (AESF) and the Olympic Council of Asia (OCA). Both organizations have since confirmed this breach.

Furthermore, the BESF has raised concerns over the unequal treatment of players during the match. Faqeehi was reportedly isolated, unable to communicate with his manager or coach. In contrast, the South Korean manager had “unrestricted access” to Kwak. The BESF contends that this disparity contributed to Bahrain’s loss, citing the “stress and trauma endured by the player.”

Conflict of Interest Allegations

Adding another layer to the controversy, the BESF has alleged a “conflict of interest.” The technical director overseeing the team was discovered to be of South Korean nationality. This revelation has intensified the BESF’s concerns over the lack of transparency and perceived bias in the proceedings.

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The Legal Road Ahead

In light of these events, the BESF has chosen to escalate the matter to the TAS/CAS, seeking justice. The federation’s statement passionately advocates for the

“fundamental principles of fair play, transparency, equitable treatment, and the right to appeal unjust decisions.”

The BESF’s appeal not only seeks justice for the Bahrain team but also underscores the pressing need for a “broader examination of the governance and oversight of esports competitions at the international stage.” The federation believes that such scrutiny is crucial to prevent similar incidents in the future.

The Need for a Dedicated Arbitral Institution for Esports Disputes

As the esports industry continues its meteoric rise, the recent controversy at the Asian Games underscores a pressing concern: the need for a specialized arbitral institution dedicated solely to resolving esports disputes. While the TAS/CAS has long been the go-to for sports-related disputes, there are growing concerns about its suitability for the unique challenges presented by esports.

Esports, with its distinct ecosystem, rapid technological advancements, and unique stakeholder dynamics, presents challenges that are often vastly different from traditional sports. The nuances of digital gameplay, software glitches, and the intricacies of online gaming platforms are just a few examples of issues that may be unfamiliar to arbitrators primarily versed in traditional sports disputes.

Furthermore, the TAS/CAS, with its roots deeply embedded in conventional sports, may not always have arbitrators with the requisite expertise in digital technology and gaming culture. This potential knowledge gap can lead to decisions that may not fully grasp the complexities of the esports world.

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The establishment of a dedicated arbitral institution for esports would ensure that disputes are adjudicated by individuals with a deep understanding of the industry. Such an institution could develop its own set of specialized rules and procedures tailored to the unique needs of esports stakeholders. Moreover, it would foster greater trust and confidence among players, teams, and organizers, knowing that their disputes are being handled by experts in the field.

In conclusion, while the TAS/CAS has played a pivotal role in sports arbitration for decades, the evolving landscape of esports necessitates the creation of a dedicated institution. Such a move would not only ensure fair and informed adjudication but also further legitimize esports as a major player in the global sports arena.

Via insidethegames

Image source: Fanny Schertzer – via WikiMedia, CC BY 3.0 DEED

Author

  • Leonid Shmatenko

    Leonid Shmatenko is part of Eversheds Sutherlands’ data protection and technology law team. He has vast experience in regulatory and general issues in the areas of eSports and Blockchain. He advises eSports associations and clubs on all legal issues, advises and supports crypto startups in all matters from planning, preparation to execution of private and public token offerings (so-called Initial Coin Offerings or ICOs). Furthermore, Leonid Shmatenko specializes in international arbitration and has participated in several arbitration proceedings (SAC, ICC, DIS, UNCITRAL, ICSID, ad hoc) as a party representative and secretary of the tribunal. Leonid Shmatenko studied at the Heinrich Heine University in Düsseldorf and is currently pursuing a PhD in international law. After his successful first state examination (2011), he completed his legal clerkship, inter alia, at the German Embassy in Lima and within international law firms in Düsseldorf and Paris. He passed the second state examination in 2015. He is an external lecturer at the National Law University of Ukraine “Yaroslav Mudryi”, where he teaches International Investment Law. He is admitted to the Bar in Switzerland and Germany. Before joining Eversheds Sutherland, Leonid Shmatenko worked as an attorney at leading law firms in Geneva, Munich and Paris.

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Moonton and Riot Games Reach Historic Settlement in Copyright Dispute

Moonton and Riot Games, two titans of the esports and gaming industry, have concluded their prolonged copyright dispute through a mutual settlement, marking a significant chapter in the evolution of intellectual property rights within the digital entertainment sector. This resolution concludes a series of legal challenges that had not only captivated the attention of the gaming community but also set a critical precedent for copyright law’s application in the fast-paced world of video gaming.

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Settlement Montoon and Riot Games

The Genesis of the Dispute between Moonton and Riot Games

The legal battle began when Riot Games, the maker of League of Legends, accused Moonton, the creator of Mobile Legends: Bang Bang. Riot Games claimed that Moonton copied essential elements like character designs, game modes, and overall style from League of Legends, leading Riot to take legal action to safeguard its creative assets and copyright.

Riot Games first took legal action in the United States but eventually had to to pursue the claims in China due to complex international copyright laws and challenges with jurisdiction, as both companies are heavily present there. This action highlights the challenges of dealing with copyright conflicts in a worldwide digital market, where intellectual property moves across borders easily and legal systems differ greatly in different regions.

Ever since starting in 2017, the legal dispute between Riot Games and MOONTON has evolved into a convoluted narrative, highlighting the fierce competition and legal complexities in the gaming sector. The main reason for this extended conflict revolves around the top games of each company: League of Legends (LoL) from Riot Games, a giant in the esports industry, and Mobile Legends from MOONTON, a rising competitor gaining fast popularity, particularly in the Southeast Asian mobile gaming sector.

The legal battle began when Riot Games accused MOONTON of copying key gameplay elements, character designs, and abilities from League of Legends for their mobile game Mobile Legends. The first legal case in the United States sparked a series of legal battles, as Riot Games claimed that Mobile Legends: 5v5 MOBA was not just inspired by but copied LoL.

Despite the US court deferring jurisdiction to China, MOONTON was still required to reach a USD 2.9 million settlement with Riot Games for copyright infringement, which also resulted in Mobile Legends being temporarily removed from app stores. However, MOONTON decided to make adjustments and relaunch the game as “Mobile Legends: Bang Bang,” in an attempt to address the controversial copyright problems.

Even with these changes and the significant agreement, the conflict was still ongoing. In May 2022, Riot Games launched another legal attack on MOONTON, accusing them of copying intellectual property from their mobile game, League of Legends: Wild Rift, including its unique promotional tactics.

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The ongoing legal disputes between Riot Games and MOONTON have sparked extensive debates within the gaming community and among industry experts. Some believe MOONTON intentionally copied League of Legends to benefit from its popularity, while others argue that similarities in MOBA games are common and shouldn’t lead to legal action. These disagreements emphasize the fine line between finding inspiration and blatant copying, showcasing the continual difficulties in protecting intellectual property in the highly competitive gaming sector.

The Settlement

Yet, the parties decided to settle the dispute. The legal communication from Montoon reads:

“After several rounds of communication, the two parties recently officially signed a settlement agreement, and Riot Games has decided to formally withdraw the corresponding lawsuits.”

The settlement not only ends a period of legal confusion but also sets the stage for a gaming sector that, with any luck, prioritizes cooperation, respect for intellectual property, and legal honesty. It acts as a powerful symbol of the fragile equilibrium between encouraging creativity and honoring the legal protections for that creativity. As the gaming industry keeps developing, the knowledge gained from this conflict will probably have a significant impact on determining its future, particularly in terms of intellectual property rights.

Industry stakeholders and legal experts are closely monitoring the agreement between Moonton and Riot Games, as they are interested in deciphering its impact on upcoming copyright disputes in the esports industry. It catalyzes game developers and publishers to align their creative aspirations with the need to uphold intellectual property rights, guaranteeing a dynamic industry future rooted in innovation, respect, and legal integrity.

Final thoughts

The settlement between Moonton and Riot Games demonstrates the importance of negotiation and highlights the value of intellectual property rights in today’s digital era. It indicates a shift toward a future where businesses participate in ethical actions, protecting the ever-changing environment of esports and gaming by being innovative, respectful, and following legal guidelines. As we move ahead, the gaming industry is at a critical point, with the resolution of this disagreement paving the way for a cooperative, respectful, and legally sound future.

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Case Overview

Plaintiff: Riot Games, Inc.

Defendant: Shanghai Moonton Technology Co., Ltd.

Court: United States District Court for the Central District of California

Case Number: 2:22-cv-3107

Counsel for Plaintiff – Riot Games, Inc.

Kirkland & Ellis LLP

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  • Dale M. Cendali
  • Joshua L. Simmons
  • Miranda D. Means
  • Yungmoon Chang

Counsel for Defendant – Shanghai Moonton Technology Co., Ltd.

Keker, Van Nest & Peters LLP

  • Ajay S Krishnan
  • Christopher S Sun
  • Edward Andrew Bayley
  • Michelle S Ybarra
  • Travis Scott Silva

Author

  • Leonid Shmatenko

    Leonid Shmatenko is part of Eversheds Sutherlands’ data protection and technology law team. He has vast experience in regulatory and general issues in the areas of eSports and Blockchain. He advises eSports associations and clubs on all legal issues, advises and supports crypto startups in all matters from planning, preparation to execution of private and public token offerings (so-called Initial Coin Offerings or ICOs). Furthermore, Leonid Shmatenko specializes in international arbitration and has participated in several arbitration proceedings (SAC, ICC, DIS, UNCITRAL, ICSID, ad hoc) as a party representative and secretary of the tribunal. Leonid Shmatenko studied at the Heinrich Heine University in Düsseldorf and is currently pursuing a PhD in international law. After his successful first state examination (2011), he completed his legal clerkship, inter alia, at the German Embassy in Lima and within international law firms in Düsseldorf and Paris. He passed the second state examination in 2015. He is an external lecturer at the National Law University of Ukraine “Yaroslav Mudryi”, where he teaches International Investment Law. He is admitted to the Bar in Switzerland and Germany. Before joining Eversheds Sutherland, Leonid Shmatenko worked as an attorney at leading law firms in Geneva, Munich and Paris.

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SumaiL v. Evil Geniuses: SumaiL Loses After Prolonged Legal Battle

In a significant legal battle within the esports community, former Dota 2 star Syed “SumaiL” Hassan’s lawsuit against his old team, Evil Geniuses (EG), and its owner, Peak6, has reached its conclusion. After more than two years of intense legal proceedings, the verdict is in, and it does not favor SumaiL. The presiding jury dismissed all counts of the lawsuit, including breach of contract and other allegations, siding entirely with EG and Peak6.

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SumaiL v EG ELN

Background of the Case

The lawsuit originally stemmed from disputes over contract negotiations, stock ownership, and the player’s standing within the company. SumaiL, who was once celebrated as one of the brightest talents in Dota 2, accused EG of exploiting his inexperience during his tenure with the team. The core of the dispute revolved around the acquisition of EG by Peak6 in 2019, which allegedly diluted SumaiL’s ownership stake in the company through the conversion of his stock into mixed options.

Further, SumaiL’s departure from EG was marred with contention. Allegations arose of the organization attempting to enforce draconian conditions upon his exit, including a stipulation for a USD 1 million payout for his shares contingent upon his retirement from competitive Dota 2—a condition SumaiL ultimately did not accept.

SumaiL’s legal team argued that EG exploited his youth and inexperience, engaging in practices that severely impacted his career and financial well-being. One of the focal points of the lawsuit was the conversion of SumaiL’s 400,000 shares of stock, a process he claimed was not fully understood by him. Furthermore, legal counsel alleged placement on the inactive roster led to a drastic salary reduction and imposed restrictions on joining other teams.

Jury Verdict and Defense Arguments

Despite these allegations, the jury’s verdict was clear, finding no evidence of malicious intent or deceit from EG in their dealings with Hassan. The defense painted a picture of an organization that had not only acted transparently but had also advised SumaiL to seek legal counsel during his contract negotiations. They contended that the organization had offered SumaiL generous financial terms and flexibility, which contradicted the claims of exploitation and malpractice.

The verdict rendered on 1 March 2024 highlights several key aspects that warrant attention from legal professionals and industry stakeholders. Firstly, the complexities surrounding contract negotiations and ownership stakes are brought to the forefront, underscoring the vulnerability of young athletes navigating the esports environment. This case exemplifies the necessity for transparent and equitable negotiation practices to ensure the fair treatment of players, who often find themselves at a disadvantage due to inexperience and lack of legal knowledge.

Second, the verdict highlights the importance of implementing clear legal guidance (and the need to seek legal counsel) within the industry. As esports continues to burgeon, establishing a robust legal framework becomes imperative to address and mitigate potential disputes effectively. The protection of player rights, particularly concerning contract negotiations and ownership interests, emerges as a paramount concern, necessitating the adoption of standardized practices that foster fairness and transparency.

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The Future of Esports Contracts

The SumaiL vs. EG verdict certainly sets a precedent with far-reaching implications for the future of esports contracts. It underscores the necessity for comprehensive contracts that explicitly outline the rights and obligations of both players and organizations.

The case also shows that enhanced legal literacy among players is utterly important to make informed decisions in contractual matters. Legal professionals specializing in esports law are thus tasked with a crucial role in educating players and organizations about the nuances of contract law within the esports domain.

Conclusion

The SumaiL vs. EG case is a groundbreaking case in the esports industry, providing important perspectives on the legal issues specific to this sector. It requires a holistic approach to improve the legal structure for esports, highlighting the importance of thorough contracts, legal understanding, and the promotion of equitable negotiation methods. As the sector evolves further, the insights from this case will definitely have a significant impact on the future of esports agreements, promoting a fair and equal environment for both players and organizations.

Sumail Syed v. The Evil Geniuses et al., Superior Court of the State of California, 21stcv46952

Counsel to Sumail Syed

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  • Sidiqqui Law, APC
    • Omar A. Siddiqui and Daniel M. Josephson
  • Christian Yoo

Counsel to Evil Geniuses

  • Masuda
    • Asa W. Markel
  • Rimôn
    • Michael Vargas

Image source: Esports Next

Author

  • Leonid Shmatenko

    Leonid Shmatenko is part of Eversheds Sutherlands’ data protection and technology law team. He has vast experience in regulatory and general issues in the areas of eSports and Blockchain. He advises eSports associations and clubs on all legal issues, advises and supports crypto startups in all matters from planning, preparation to execution of private and public token offerings (so-called Initial Coin Offerings or ICOs). Furthermore, Leonid Shmatenko specializes in international arbitration and has participated in several arbitration proceedings (SAC, ICC, DIS, UNCITRAL, ICSID, ad hoc) as a party representative and secretary of the tribunal. Leonid Shmatenko studied at the Heinrich Heine University in Düsseldorf and is currently pursuing a PhD in international law. After his successful first state examination (2011), he completed his legal clerkship, inter alia, at the German Embassy in Lima and within international law firms in Düsseldorf and Paris. He passed the second state examination in 2015. He is an external lecturer at the National Law University of Ukraine “Yaroslav Mudryi”, where he teaches International Investment Law. He is admitted to the Bar in Switzerland and Germany. Before joining Eversheds Sutherland, Leonid Shmatenko worked as an attorney at leading law firms in Geneva, Munich and Paris.

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The Arbitration Turn in the Activision Blizzard Call of Duty League Monopoly Dispute

The legal confrontation involving Hector “H3CZ” Rodriguez and Seth “Scump” Abner against Activision Blizzard over claims related to the Call of Duty League (CDL) has transitioned from a public courtroom battle to a private arbitration process. This case brings to light the intricacies of resolving disputes in the esports industry, emphasizing the impact of contractual arbitration clauses on the legal strategies of parties involved.

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Hecz v Activision Arbitration ELN

The Shift to Arbitration: A New Path for Resolution

In a notable pivot from the courtroom to the arbitration table, the lawsuit filed by H3CZ and Scump seeking substantial damages from Activision Blizzard has been dismissed, with the parties agreeing to arbitration and thereby ending the litigation. This move underscores a reevaluation of legal tactics, likely influenced by the arbitration clause embedded within the CDL agreements, demonstrating the power such clauses hold in determining the forum and nature of dispute resolution.

The Essence of Arbitration

Arbitration is a procedure in which a dispute is submitted, by agreement of the parties, to one or more arbitrators who make a binding decision on the dispute. In choosing arbitration, the parties opt for a private dispute resolution procedure instead of going to court.

Its principal characteristics are:

Arbitration is consensual

Arbitration can only take place if both parties have agreed to it. In the case of future disputes arising under a contract, the parties insert an arbitration clause in the relevant contract. An existing dispute can be referred to arbitration by means of a submission agreement between the parties. In contrast to mediation, a party cannot unilaterally withdraw from arbitration.

The parties choose the arbitrator(s)

Under e.g. the JAMS Comprehensive Arbitration Rules, the parties can select a sole arbitrator or a tribunal of three arbitrators together. If they choose to have a three-member arbitral tribunal, each party appoints one of the arbitrators; those two persons then agree on the presiding arbitrator. Alternatively, potential arbitrators with relevant expertise can be suggested or directly appointed by the arbitral institutions. For example, the WIPO maintains an extensive roster of arbitrators ranging from seasoned dispute-resolution generalists to highly specialized practitioners and experts covering the entire legal and technical spectrum of intellectual property.

Arbitration is neutral

In addition to their selection of neutrals of appropriate nationality, parties are able to choose such important elements as the applicable law, language and venue of the arbitration. This allows them to ensure that no party enjoys a home court advantage.

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Arbitration is a confidential procedure

The chosen arbitration rules usually ensure the secrecy of the arbitration’s existence, any information revealed during the process, and the final decision. In specific scenarios, the JAMS Rules permit a party to limit the exposure of trade secrets or confidential data shared with the arbitration panel or a confidentiality consultant to the panel.

The decision of the arbitral tribunal is final and easy to enforce

According to the WIPO Rules, the involved parties commit to executing the panel’s verdict promptly. Global judgments are recognized and enforced by domestic courts under the New York Convention, which only allows for their annulment in exceptionally rare situations. Over 165 countries are signatories to this Convention.

The Arbitration Clause in Depth

The arbitration clause at the heart of this dispute lays out a detailed process for resolving disputes, beginning with an attempt at informal resolution through negotiation and consultation. It states:

. BINDING ARBITRATION AND CLASS ACTION WAIVER:

READ THIS SECTION CAREFULLY. IT MAY SIGNIFICANTLY AFFECT YOUR LEGAL RIGHTS, INCLUDING YOUR RIGHT TO FILE A LAWSUIT IN COURT.

These BINDING ARBITRATION AND CLASS ACTION WAIVER provisions apply to you if you are domiciled in and/or use the CDL Service in the United States. These provisions may also apply to you if you are domiciled in and/or use the CDL Service from outside the United States. See JURISDICTION AND APPLICABLE LAW below for details.

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Initial Dispute Resolution: CDL’s Customer Support department is available to address any concerns you may have regarding the CDL Service. Most concerns are quickly resolved in this manner to our customers’ satisfaction. The parties shall use their best efforts to settle any dispute, claim, question, or disagreement directly through consultation and good faith negotiations which shall be a precondition to either party initiating a lawsuit or arbitration.

Binding Arbitration: If the parties do not reach an agreed upon solution within a period of 30 days from the time informal dispute resolution is pursued pursuant to the paragraph above, then either party may initiate binding arbitration as the sole means to formally resolve claims, subject to the terms set forth below. Specifically, all claims arising out of or relating to this Agreement (including its interpretation, formation, performance and breach), the parties’ relationship with each other and/or your use of the CDL Service shall be finally settled by binding arbitration administered by JAMS in accordance with the provisions of its Comprehensive Arbitration Rules or Streamlined Arbitrations Rules, as appropriate, excluding any rules or procedures governing or permitting class actions. This arbitration provision is made pursuant to a transaction involving interstate commerce, and the Federal Arbitration Act (the “FAA“) shall apply to the interpretation, applicability, enforceability and formation of this Agreement notwithstanding any other choice of law provision contained in this Agreement. The arbitrator, and not any federal, state, or local court or agency, shall have exclusive authority to resolve all disputes arising out of or relating to the interpretation, applicability, enforceability, or formation of this Agreement, including without limitation any claim that all or any part of this Agreement is void or voidable, or whether a claim is subject to arbitration. The arbitrator shall be empowered to grant whatever relief would be available in a court under law or in equity. The arbitrator’s award shall be binding on the parties and may be entered as a judgment in any court of competent jurisdiction.

The JAMS Rules governing the arbitration may be accessed at http://www.jamsadr.com/ or by calling JAMS at (800) 352-5267. Your arbitration fees and your share of arbitrator compensation shall be governed by the JAMS Comprehensive Arbitration Rules and, to the extent applicable, the Consumer Minimum Standards, including the then-current limit on arbitration filing fees. To the extent the filing fee for the arbitration exceeds the cost of filing a lawsuit, CDL will pay the additional cost. The parties understand that, absent this mandatory provision, they would have the right to sue in court and have a jury trial. They further understand that, in some instances, the costs of arbitration could exceed the costs of litigation and the right to discovery may be more limited in arbitration than in court.

Location: If you are a resident of the United States, arbitration will take place at any reasonable location within the United States convenient for you. For residents outside the United States, arbitration shall be initiated in Los Angeles County, California, and you and CDL agree to submit to the personal jurisdiction of any federal or state court in Los Angeles County, California, in order to compel arbitration, to stay proceedings pending arbitration, or to confirm, modify, vacate, or enter judgment on the award entered by the arbitrator.

Class Action Waiver: The parties further agree that any arbitration shall be conducted in their individual capacities only and not as a class action or other representative action, and the parties expressly waive their right to file a class action or seek relief on a class basis. YOU AND CDL AGREE THAT EACH MAY BRING CLAIMS AGAINST THE OTHER ONLY IN YOUR OR ITS INDIVIDUAL CAPACITY, AND NOT AS A PLAINTIFF OR CLASS MEMBER IN ANY PURPORTED CLASS OR REPRESENTATIVE PROCEEDING. If any court or arbitrator determines that the class action waiver set forth in this paragraph is void or unenforceable for any reason or that an arbitration can proceed on a class basis, then the arbitration provision set forth above shall be deemed null and void in its entirety and the parties shall be deemed to have not agreed to arbitrate disputes.

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Exception – Litigation of Intellectual Property and Small Claims Court Claims: Notwithstanding the parties’ decision to resolve all disputes through arbitration, either party may bring an action in state or federal court that only asserts claims for patent infringement or invalidity, copyright infringement, moral rights violations, trademark infringement, and/or trade secret misappropriation, but not, for clarity, claims related to the license granted to you for the CDL Service under this Agreement. Either party may also seek relief in a small claims court for disputes or claims within the scope of that court’s jurisdiction.

30 Day Right to Opt Out: You have the right to opt-out and not be bound by the arbitration and class action waiver provisions set forth in the “Binding Arbitration,” “Location,” and “Class Action Waiver” paragraphs above by sending written notice of your decision to opt-out to the following address: The Call of Duty League, LLC, Attention: Legal, 3100 Ocean Park Blvd., Santa Monica, CA 90405. The notice must be sent within 30 days of purchasing the CDL Service (or if no purchase was made, then within 30 days of the date on which you first access or use the CDL Service and agree to these terms); otherwise you shall be bound to arbitrate disputes in accordance with the terms of those paragraphs. If you opt-out of these arbitration provisions, CDL also will not be bound by them.

Changes to this Section: CDL will provide 60-days’ notice of any changes to this Section. Changes will become effective on the 60th day and will apply prospectively only to any claims arising after the 60th day.”

The Arbitration Clause: A Closer Look

The arbitration clause involved in this lawsuit outlines a detailed process beginning with an initial attempt at dispute resolution through negotiation. Failing this, the parties are bound to engage in binding arbitration, governed by the JAMS Comprehensive Arbitration Rules. This clause clearly specifies arbitration as the sole means for formal dispute resolution, highlighting its mandatory nature and the intention to avoid litigation costs.

Additionally, the clause contains a class action waiver, significantly limiting the ability to pursue collective legal action. This aspect of the arbitration agreement underscores the individual nature of arbitration and the parties’ agreement to resolve disputes outside of a class or representative action.

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The movement towards arbitration after initiating a lawsuit indicates a reconsideration of legal tactics, possibly recognizing the enforceability of the arbitration clause or aiming for a resolution that balances privacy, speed, and cost-effectiveness. This strategic shift also reflects the broader legal landscape in esports, where arbitration clauses are increasingly common, guiding how disputes are resolved within the industry.

The Role of Arbitration in Esports Disputes

The case of H3CZ and Scump versus Activision Blizzard serves as great example of the legal intricacies and strategic decisions underlying disputes in the esports arena, and the necessity to read the Terms & Conditions. The move from court to arbitration demonstrates that the Claimants might have chosen the wrong forum and also highlights the broader trend towards using arbitration to resolve disputes in the esports industry. As the sector continues to grow, understanding and navigating these legal frameworks will be crucial for stakeholders at all levels.

Case Information for Rodriguez v. Activision Blizzard Inc.

Court: U.S. District Court for the Central District of California

Case Number: Rodriguez v. Activision Blizzard Inc., No. 2:24-cv-01287

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Filing Date: 15 February 2024

Counsel Information:

For Plaintiffs (Hector Rodriguez, Seth Abner, HECZ LLC):

  • Firm: Dynamis LLP and Aaron Katz Law LLC
  • Eric Rosen, Constantine P. Economides, Brianna K. Pierce
  • Aaron M. Katz
  • Locations: Not specified in the provided information

For Defendant (Activision Blizzard Inc.):

  • Counsel information not provided in the available documentation.

Image source: Drift0r on Youtube

With material from WIPO

Author

  • Leonid Shmatenko

    Leonid Shmatenko is part of Eversheds Sutherlands’ data protection and technology law team. He has vast experience in regulatory and general issues in the areas of eSports and Blockchain. He advises eSports associations and clubs on all legal issues, advises and supports crypto startups in all matters from planning, preparation to execution of private and public token offerings (so-called Initial Coin Offerings or ICOs). Furthermore, Leonid Shmatenko specializes in international arbitration and has participated in several arbitration proceedings (SAC, ICC, DIS, UNCITRAL, ICSID, ad hoc) as a party representative and secretary of the tribunal. Leonid Shmatenko studied at the Heinrich Heine University in Düsseldorf and is currently pursuing a PhD in international law. After his successful first state examination (2011), he completed his legal clerkship, inter alia, at the German Embassy in Lima and within international law firms in Düsseldorf and Paris. He passed the second state examination in 2015. He is an external lecturer at the National Law University of Ukraine “Yaroslav Mudryi”, where he teaches International Investment Law. He is admitted to the Bar in Switzerland and Germany. Before joining Eversheds Sutherland, Leonid Shmatenko worked as an attorney at leading law firms in Geneva, Munich and Paris.

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