Esports and the Law News, Case Summaries, Articles, and Strategies Concerning Esports and the Law Presented by Skadden

Summer 2020 Route To: ____/____/____/____ Esports and the Law News, case summaries, articles, and strategies concerning esports and the law Presented by Skadden

Players Take a Stand and Secure a INSIDE THIS ISSUE Legal Victory in Esports Case Study Looks at Whether Video Game Addiction Is Real? 2 By Ellen M. Zavian, Esq. filed an action in the Superior Court of California for breach of contract and Martino Brings Long-Simmering espite the meteoric growth of fraudulent misrepresentation, to name Passion to His Role as Esports the esports industry in recent “D a few claims, against their Team entity, Lawyer 3 years, it unfortunately remains plagued by Naventic, LLC, and owner, James Ross team-entities that fail to pay their players Lupu Guides UTA’s Gaming Practice to New Heights 5 agreed upon salaries, fail to distribute Elliott II (collectively the ‘Defendants’). The complaint focused on winnings earned prize money, and deceive their Court Orders Fortnite Developer players for their own gains. Defendant earned by the Plaintiffs while compet- Case to Arbitration 6 Naventic is one such team entity.” ing in the ‘Heroes of the Storm’. The Military Depictions in Video This is the plaintiffs' opening argument gamers took 5th and 6th place, earned prize money, but none of the money was Games: Trademark Infringement in a legally significant setting matter in or First Amendment Protection? 7 California state court (Superior Court of received by the players. This was despite the State of California – Riverside Country, the fact that the Defendants allegedly Litigation Festers Between received the prize money from the com- Turner ‘Tfue’ Tenney and Former Case No: MCC1800976), where gamers Employer 8 collectively sued their owner for back petition organizers. pay….and actually won. At the time of competition win, the Steve Jackson Games, Inc. v. In August of 2018, gamers known gamers performed under independent inXile Entertainment, Inc. 9 contractor agreements, executed in early as Zuna, Kenma, Bkid, Tomster and News Briefs 11 BigEmpact (collectively the ‘Plaintiffs’), See PLAYERS on Page 6

Court Grants Summary Judgment for Video Game Publisher in Tattoo Copyright Case

By Hannah M. Marek, of Skadden, publisher Take Two Take Two’s NBA 2K video game Arps, Slate, Meagher & Flom LLP Interactive, finding franchise features realistic renderings that Take Two’s use of NBA basketball games, with lifelike n March 26, 2020, the U.S. of images of certain depictions of the players, including their District Court for the Southern O NBA stars’ copy- tattoos. Solid Oak, the exclusive licensee District of New York drew clear limits righted tattoos in to certain tattoos inked on three NBA on the scope of copyright protection its basketball simu- players, sued Take Two for infringing available for tattoos inked on public lation video games, its copyrights in those tattoos. Take Two figures. InSolid Oak Sketches, LLC v. 2K Hannah Marek published by Take moved for summary judgment dismissing Games, Inc., Judge Laura Swain dismissed Two’s 2K Games Solid Oak’s copyright claim and entering a tattoo art licensee Solid Oak’s copyright studio, was de minimis, authorized by declaratory judgment in Take Two’s favor. infringement lawsuit against video game implied license, and fair use. See SUMMARY Page 10

Study Looks at Whether Video Game Esports and the Law Addiction Is Real?

HOLT HACKNEY or most adolescents, playing video video games may have been important in Managing Editor and Publisher Fgames is an enjoyable and often social developing these negative outcomes. form of entertainment. However, there is a To measure predictors and outcomes to Hackney Publications growing concern that spending too much video game addiction, Coyne studied 385 time playing video games is related to adolescents as they transitioned into adult- negative developmental outcomes and can hood. Each individual completed multiple THE ROBERTS GROUP become an addiction. questionnaires once a year over a six-year Design Editor A recent six-year study, the longest study period. These questionnaires measured de- ever done on video game addiction, found pression, anxiety, aggression, delinquency, ELLEN M. ZAVIAN, ESQUIRE that about 90 percent of gamers do not play in empathy, prosocial behavior, shyness, sensory Adjunct Professor at George a way that is harmful or causes negative long- Washington University, reactivity, financial stress and problematic Professorial Lecturer in Sports term consequences. A minority, though, can cell phone use. Law at George Washington Law become truly addicted to video games and School as a result can suffer mentally, socially and Editor In Chief behaviorally, according to the study. “The aim of this particular study is to COURTNEY SEAMS look at the longer-term impact of having Researcher a particular relationship with video games BRIANA NARDONE and what it does to a person over time,” “Pathological video Marketing said Sarah Coyne, a professor of family life gameplay is characterized Please direct editorial or subscription at BYU and lead author of the research. “To by excessive time spent inquiries to Hackney Publications at: see the impact, we examined the trajectories playing video games, [email protected]. of pathological video gameplay across six difficulty disengaging from Esports and the Law is years, from early adolescence to emerging them and disruption to published quarterly by Hackney adulthood.” healthy functioning due to Publications. In addition to finding long-term con- gaming.” Postmaster send changes to: sequences for addicted gamers, this study, Hackney Publications, P.O. Box published in Developmental Psychology, also 684611, Austin, TX 78768. breaks down gamer stereotypes and found that pathological gaming is not a one size Copyright © 2020 Hackney Two main predictors for video game ad- Publications fits all disorder. Pathological video gameplay is character- diction were found: being male and having ized by excessive time spent playing video low levels of prosocial behavior. Having games, difficulty disengaging from them higher levels of prosocial behavior, or vol- and disruption to healthy functioning due untary behavior meant to benefit another person, tended to be a protective factor Skadden is the advertiser and sponsor to gaming. against the addiction symptoms. and the views expressed here are not Only about 10 percent of gamers fall into the firm’s views. the pathological video gameplay category. Aside from the predictors, Coyne also When compared to the non-pathological found three distinct trajectories of video group, those in the study displayed higher game use. Seventy-two percent of adolescents levels of depression, aggression, shyness, were relatively low in addiction symptoms problematic cell phone use and anxiety by across the six years of data collection. Another emerging adulthood. This was despite the 18 percent of adolescents started with moder- groups being the same in all these variables ate symptoms that did not change over time, at the initial time point, suggesting that See STUDY on Page 8

Martino Brings Long-Simmering Passion to His Role as Esports Lawyer

By Ellen M. Zavian, Esq.

s a partner at Skadden Arps Slate AMeagher & Flom LLP, Matthew M. Martino represents a wide variety of "When I was a kid, we had an clients in antitrust litigation and advisory Atari in our house, and I have matters. many fond memories of playing Beyond his antitrust expertise, he games on it with my family. One has handled disputes on behalf of sports particularly memorable game leagues and their teams involving labor was Activision’s Decathlon." and employment, torts, bankruptcy, gambling, team relocation, intellectual —Matthew Martino property rights, contractual issues, and other legal matters. He also has counseled sports clients with respect to a variety of business practices, including league the major ways I bonded and connected the rare occasion when we are preparing governance, licensing, sponsorships, mer- with family and friends. for a jury trial (which does not happen chandising, events, new media, broadcast Q: What was your first experience with too often in my practice), it is nice to rights, and ticketing. video games? share that background and have a bit Martino graduated from the University A: When I was a kid, we had an Atari of insight into that process. Probably of Pennsylvania summa cum laude with in our house, and I have many fond the most relevant takeaways from my a B.A. degree in Psychology. Following memories of playing games on it with my undergraduate work that I have applied undergraduate school, he attended Yale family. One particularly memorable game to my career have come from my classes Law School. He was President of the Yale was Activision’s Decathlon, in which you in sleep studies and my time working in Entertainment & Sports Law Association competed in Olympic-style decathlon a research lab studying sleep deprivation. and an editor of the Yale Law & Policy events. I recall that if you surpassed certain As you can imagine, especially as a young Review and the Yale Journal on Regulation. score levels, you could take a photo of the associate, having some background in and What follows is an interview with television screen with a Polaroid camera understanding of sleep deprivation comes Martino. and mail the photo to Activision, and in in handy from time to time! Question: Did you play sports growing return, the company would mail you back Q: With many of the same owners from up and if yes, what sports? a bronze, silver, or gold patch depending the NHL and NBA getting involved at the Answer: Yes. I played baseball and on the score you achieved. I spent many, ownership level in esports, have you seen a wrestled, but alas I was not good enough at many hours playing Decathlon with my change in the understanding of how anti- either to participate beyond high school. father and brother trying to win those trust applies to esports over the past 2-3 years? Playing sports as a child and teen, how- patches, and we did win some. A: Certainly, for those owners, I would ever, taught me the value of hard work, Q: How does your bachelor’s degree expect a greater understanding of the dedication, perseverance, and teamwork, impact your legal profession? antitrust laws and how they apply to their lessons that I utilize every day in my legal A: I majored in psychology because it esports businesses because they have been practice. And it was a lot of fun. I also was was remarkably interesting to me, but it dealing with those legal issues with their a huge sports fan and watched all of the hasn’t had a great impact on my legal prac- traditional sports teams for many years. major professional sports, rooting for all tice. However, I do at times harken back As esports leagues continue to mature, of the Philadelphia teams (Eagles, Flyers, to some of my social psychology classes I would expect an even greater under- Sixers, Phillies) as I grew up in southern when dealing with adversaries, witnesses, standing of the antitrust laws to emerge New Jersey, not far from the stadium and the like. And jury consultants often among all stakeholders as the legal issues complex in Philadelphia. It was one of have backgrounds in psychology, so on See MARTINO on Page 4

Martino Brings Long-Simmering Passion to His Role as Esports Lawyer

Continued From Page 3 inevitably arise. Our group is uniquely bright-line rules with respect to some of fronted with claims of monopolization. positioned in that we are able to draw these issues and business practices—for Because of the parallels to traditional from the resources of Skadden’s world- example, recognizing that some estab- sports, esports leagues and teams may be wide Antitrust/Competition capabilities lished and well-considered practices are able to look to the history, experience, and apply them to developing issues in actually presumed lawful—would allow and legal precedents of traditional sports the esports realm. for more efficient and less costly deter- properties in handling such disputes. Q: Antitrust was not originally written to minations when the conduct of a league Q: Where do you see the esports industry apply to the unique business structure found in sports, where teams do not want other teams to fail (except on the field maybe), how might you rewrite the antitrust laws to better apply to traditional sport structures? A: I am not sure whether it requires rewriting the antitrust laws, but I would like to see a better understanding and ap- “The esports industry continues to thrive and grow, and in preciation in the law of how competition many, metrics has begun to outpace the traditional sports and cooperation work in professional industry.” sports. For example, do teams within a particular league really compete with each other for the sale of tickets, conces- sions, merchandise, broadcasts, etc., or is it more likely that a team competes more with the local teams of other sports leagues and with the other entertainment in 10 years? and its teams is challenged. options available within the team’s spe- A: The esports industry continues to Q: What are the parallels between es- cific geographic locale? And with respect thrive and grow, and in many, metrics has ports and traditional sports when it comes to the cooperation among teams that is begun to outpace the traditional sports to antitrust? often necessary for a league to function industry. I expect this growth trajectory A: As esports businesses continue to and thrive as a business in the competi- to continue with the explosion of addi- evolve, they likely will face many of the tive world of sports and entertainment, I tional digital and social media platforms same legal issues as traditional sports would like to see a better recognition in and the appetite of young fans for new the law and among courts of the realities leagues and teams. Like in traditional sources of content. The global pandemic of sports league operations and how they sports, esports teams within particular in which we now find ourselves, and the may differ from other industries. Many leagues often will need to cooperate with attendant restrictions on our daily lives, of the agreements among teams and respect to a variety of business practices, has only served to further highlight this joint efforts within a particular league including league governance, labor and are procompetitive in that they, among other player issues, licensing of intel- phenomenon, as even traditional sports other things, foster competitive balance, lectual property, sponsorships, merchan- have moved to esports content to satisfy prevent free-riding, ensure economic ef- dising, broadcasting, and ticketing. As their fans. If anything, I think our cur- ficiencies, and otherwise better enable the revenues increase, the leagues and teams rent situation may accelerate the already league to compete with other sports and may become the targets of antitrust chal- explosive rate of growth of the esports entertainment offerings. Unfortunately, lenges to some of these practices under industry. It would not surprise me if in however, the leagues often need to en- the antitrust laws. Leagues may also face 10 years the esports industry is a fixture dure very expensive litigation in order assertions of dominance with respect to in our homes and a major player for our to demonstrate this, and perhaps some particular market segments and be con- entertainment and leisure spending. l

Lupu Guides UTA’s Gaming Practice to Unprecedented Heights

hen United Talent Agency (UTA) Whired away Ophir Lupu from Creative Artists Agency (CAA) nine years ago and asked him to lead its then-nascent "The business has hyper- gaming practice, the agency knew it was matured in the past few years getting a rising star. as investors have poured a lot Lupu has not disappointed, building out what has become one of the gaming of money into the ecosystem. industry’s leading pools of talent. As a result, the expectations His productivity aside, Lupu has also surrounding gamers' proven to be one of those rare executives responsibilities and professional that can adapt to the marketplace with services have led to some creative solutions. Witness how he has used significant, but very necessary, the pandemic to build a robust community challenges." at UTA, a phenomenon that was profiled in April in the Hollywood Reporter: —Ophir Lupu https://www.hollywoodreporter.com/ news/quarantine-uta-turns-gaming-stay- connected-1289602. Counter-Strike, and many others. That as a growth area nearly a decade ago, and Industry observers like Michael Folger, investment gave us a better understanding we have remained committed to expanding a senior associate at Skadden, believe Lupu of the broader esports and game stream- the landscape ever since. and UTA will emerge from the current ing landscape. With that knowledge, it Q: crisis stronger than ever. His track record What legal issues arising in the eSports became obvious to us that UTA needed industry are UTA’s clients facing? and the influence he will undoubtedly have to build a much deeper connection to the A: Like most young and fast-growing on the industry make him a great candidate esports business. After several months of business areas, esports is experiencing a for a brief interview, which follows: meeting as many people as we could, we Question: Ophir, how did you personally acquired management company Everyday very natural set of growing pains. The get involved with UTA’s eSports and gaming Influencers and its sister company, digital business has hyper-matured in the past initiatives? esports agency Press X, which provided few years as investors have poured a lot Answer: I have been running UTA’s us with an incredible roster of agents and of money into the ecosystem. As a result, Gaming Division since I joined the com- clients. I am very proud of our division’s the expectations surrounding gamers’ pany in 2011. Our department represents continued expansion, and I would argue responsibilities and professional services best-in-class game developers by sourcing that it is among the most well-respected have led to some significant, but very and negotiating publishing deals as well groups across the gaming industry. necessary, challenges. There have been as advising on investments and acquisi- Q: What led UTA to take such significant questions about the differing roles of tions. A few years ago, my good friend steps into eSports and video gaming? agents vs. managers, standard commission Sam Wick (Head of UTA Ventures) A: UTA has always challenged itself to rates, whether a team has the authority to and I spearheaded UTA’s investment in be forward-thinking and entrepreneurial in manage its players, and the role of the Play- Cloud9, a leading global esports organi- its growth strategy. Gaming is one of the ers’ Association in any of the franchised zation that manages championship teams largest and most rapidly expanding seg- leagues. These rules are all being written across League of Legends, Overwatch, ments of media. UTA had identified this in real-time. l

Court Orders Fortnite Developer Case to Arbitration

By Lauryn Robinson, GWLaw 2L to arbitrate on an individual basis only; (2) related matters are outside the scope of delegation clause granting the arbitrator arbitration. According to common law, ichael Heidbreder, a Missouri the power to determine whether a specific when the parties’ contract delegates the resident, filed suit alleging Epic M dispute is governed by the arbitration Games’ “vulnerable” security allowed hack- arbitrability question to an arbitrator, ers to charge fraudulent in-game purchases clause; (3) a venue selection clause giving a court may not override the contract.” to his debit card between November 2018 user the choice of venue between their Henry Schein, Inc. v. Archer & White Sales, and January 2019. home state or North Caroline; (4) Epic Inc., 139 S. Ct. 524, 529 (2019). There- Heidbreder filed both statutory and Games’ agreement to pay arbitration fees fore, the arbitrator, rather than the court, common law claims including negligence, under $10,000, share costs after $10,000 determines the scope of these provisions. breach of implied contract and violation of and not seek attorney fee’s against users Lastly, Heidbreder claimed the class state consumer-protection and data-breach and (5) a 30 -day opt-out provision, giv- action waiver, arbitration clause and class statutes with the U.S. District Court of ing users a 30 day window after agreeing action clause are unconscionable because the Eastern Division of North Carolina. to the End User License Agreement to Epic Games is applying the agreement However, assigned Judge Terrence W. opt out of arbitration provision.” Compl. retroactively. Judge Boyle acknowledges Boyle decided the matter must be moved Heidbreder presented three compelling, yet quibbles with Heidbreder’s last argu- to arbitration since the End User License yet unsuccessful, arguments. ment noting the terms at issue “are com- Agreement (“EULA”) with Fornite devel- First, he asserted his minor son lacked mon terms in modern contracts that have oper, Epic Games, mandated such. contractual capacity to agree to the EULA. been recently sanctioned by the courts and That decision was made in response Judge Boyle rejected this argument noting can hardly be considered substantively to Epic Games’ Motion to Compel, filed “under the basic principles of principal- unconscionable.”l in October 2019, which argued that the agent law” his son acted as Heidbreder’s terms and conditions of the EULA should agent, giving him both actual and apparent Heidbreder v. Epic Games, Inc. No. prevail. Pursuant to the EULA, the arbitra- authority to agree. 5:19-cv-348, 2020 WL 548408 tion provision included: “(1) an agreement Second, Heidbreder argued that privacy (E.D.N.C. Feb. 3, 2020)

Players Take a Stand and Secure a Legal Victory in Esports Case

Continued From Page 1

2016, which called for the team to be paid gamers were not receiving their prize Statement of Jimmy Ross Elliott, II a percentage first (5%), before issuing winnings owed or their monthly stipends. My involvement with Naventic, the balance due (95%) to the gamers in Although the team owner continued LLC, both as a Member and as a timely manner, from prize winnings. to promise the overdue prize money and an unpaid CEO, was challenging. A second contract was entered into missed monthly payments, none were Regardless of my efforts to assist by the Plaintiffs in November of 2016, received by the gamers. After many failed Naventic, LLC, become a successful keeping the gamers as independent con- promises, the Defendant ceased all com- esports organization, desired results tracts. The terms called for the gamers munications with the Plaintiffs. Despite were not obtained. Such resulted in a to continue to receive monthly stipends such, the gamers continued to perform negative impact on people’s lives, in- in addition to their prize winnings. Even until the end of August 2017, when the though the gamers still had not received Plaintiffs terminated the November 2016 cluding Christopher ‘Zuna’ Buechter, their prize money from the Heroes’ event, agreements. Ken “Kenma” Buechter, Josh ‘Bkid’ in good faith, they entered into this second Following a settlement in the gamers’ Choi, Sammuel ‘Bigempct’ Hua, and agreement … hoping for the best. favor, the players requested a public state- Thomas ‘Tomster’ Maguire. I am However, ‘best’ never came and the ment from the team owner: truly sorry. l

Military Depictions in Video Games: Trademark Infringement or First Amendment Protection?

By Laura Saini, GWLaw 3L

ideo game publishers may be able to Vbreathe a sigh of relief when using trademarked military equipment in their video games without an agreement. AM General lost its trademark infringement claim against Activision, Inc., publisher of the popular Call of Duty games, for its depiction of trademarked military vehicles. Call of Duty 4: Modern Warfare is a first-person shooting game, simulating realistic military storylines, weapons, and equipment. Call of Duty Modern Warfare is one of the most popular games, generating over $1.13 billion as of 2019. To make players feel like they are in a virtual military reality, publisher Activision featured official military High Mobility tary uses it in war efforts. For determining that Textron, the owner of the helicopters’ Multipurpose Wheeled Vehicles (“Humvee”) whether the use was misleading, the court trademark, provided Electronic Arts with in its game without a licensing deal. AM looked at several Polaroid factors. The court knowledge and expertise to recreate the General, the manufacture of Humvee, sued found that there was no misleading use be- workings of the Bell-manufactured helicop- in the Southern District of NY, claiming cause both parties have different purposes in ters. Textron argued that its helicopters are trademark infringement because Activision using the mark. AM General used the mark prominent in Battlefield 3 because consum- features its Humvee without authorization. to sell Humvee, whereas Activision used ers factor flying the helicopters when they The Supreme Court found in Brown the mark to replicate military warfare in its buy the game, and the game prominently v. Entertainment Merchants Ass’n (2011) game. Although there was some consumer displayed the trademarked name of the that video games are considered a form of confusion about AM’s association with Call helicopters. The court agreed in summary expression that is subject to first amend- of Duty, the court found the likelihood of judgement that there could be confusion ment protection. Activision used a first confusion was not compelling enough to as to Textron’s sponsorship of Battlefield amendment defense when filing for sum- outweigh the first amendment interests. 3. After Electronic Arts lost on summary mary judgment, stating that it has a right The court ruled for Activision and judgement, both parties settled out of court. to use the Humvee because the goal of dismissed the suit on summary judgment. The main difference between Humvee Call of Duty is to create a realistic military While first amendment defenses are often and Bell-manufactured Helicopters is that scene for its players. The court used a test successful when video games are trying to Humvee was incidental to Call of Duty’s developed in Rogers v. Grimaldi, a case about depict reality, there are cases where courts depiction of warfare, whereas Bell Helicop- trademark infringement in movie titles, to have found that the use is misleading. In ters’ were more centerpiece in Battlefield 3. weigh trademark infringement concerns another military video game, Battlefield 3, The implications of video game publishers against first amendment protections. The the Northern District of California found frequently losing on first amendment de- court looks to whether the trademarked use that the use was misleading because there fenses would be problematic for publishers has any artistic relevance to the work, and was a strong likelihood of confusion under trying to show a realistic scene. Still, video whether the use is misleading. the Rogers v. Grimaldi test. game developers will have to weigh the The court found that the use of Humvee Battlefield 3 depicts the Bell-manufac- risks of using trademarked images in their is related to a game that simulates warfare tured helicopters that are used in the U.S. video games without a licensing agreement with a lifelikeness reality. The whole purpose military. In Electronic Arts v. Textron, Inc., because there is no guarantee a court will of using Humvee was because the U.S. mili- the court found that players could believe find a first amendment defense. l

Litigation Festers Between Turner ‘Tfue’ Tenney and Former Employer, FaZe Across Three Venues, Two Jurisdictions

By Ellen M. Zavian, Esq. “…avoid a binding and enforceable forum the Gamer Agreement (employment agree- selection clause”. ment) contains a “mandatory and exclusive t took a great deal of guts for Turner Judge Rakoff is also not wasting anytime. forum selection clause and choice of law “Tfue” Tenney to sue his former em- I He ordered a pretrial conference in March clause in New York, as well as consents by ployer, FaZe, over breach of contract and and according to filed documents (dated violation of the California Talent Agency both parties to personal jurisdiction in the October 31, 2019), the parties should Act, to name just a few of the claims as- state and federal courts of New York”. prepare for a jury trial to begin on March serted [see issue Q2 of esportsandthelaw. In the end, Judge Rakoff ruled in favor 4, 2020 [the virus has delayed all matters com for more details], and now all parties of FaZe’s, denying the Motion to Dismiss, in the New York court docket]. stating that it viewed Tenney’s argument was will need to deal with three venues and In the Motion to Dismiss, Tenney’s de- two jurisdictions; two in California (one an ‘obvious attempt’ to escape the terms and fense heavily relied upon the Colorado River conditions of his executed agreement with in the Los Angeles Superior Court and the abstention doctrine (Colorado River Water FaZe. Furthermore, the Court determined other with the California Labor Commis- Conservation Dist. V. United States, 424 that only factor 3 of the Colorado River sioner’s Office) as well as the third venue, U.S. 800 (1976). The doctrine requires the Doctrine really needed to be analyzed (the the Southern New York District Court. court to consider six factors: (1) whether desire to avoid piecemeal litigation). In its This multi-state decision was handed the controversy involves a res (res???) over review, the Court ultimately decided that down by the NY Judge Jed S. Rakoff when which one of the courts has assumed ju- the inconvenience of multiple forums did he denied Tenney’s motion to dismiss or risdiction; (2) whether the federal forum stay the court proceedings while he dealt is less inconvenient than the other for the not rise to the level of an ‘exceptional’ cir- with the matters in California. parties; (3) whether staying or dismissing cumstance that would justify abstention. In While Tenney filed his actions in Califor- the federal action will avoid piecemeal addition, should the California Labor Com- nia, it was FaZe’s maneuver to file a coun- litigation; (4) the order in which the ac- missioner have exclusive jurisdiction over tersuit in NY in order to enforce the venue tions were filed, and whether proceedings the TAA claim, then the risk of piecemeal and jurisdiction clause in the employment have advanced more in one forum than in litigation might even be lowered. agreement which named NY as its “man- the other; (5) whether federal law provides While we have not even gotten to the datory and exclusive forum selection”. In the rule of decision; and (6) whether the merits of the matter in any venue/forum, the decision, Judge Rakoff found Tenney’s state procedures are adequate to protect the what we do know is that neither party will arguments “…unpersuasive” and viewed plaintiff’s federal rights. be walking away from this fight anytime Tenney’s actions as merely an attempt to In defense, FaZe strongly argued that soon. l

Study Looks at Whether Video Game Addiction Is Real?

Continued From Page 2 and only 10 percent of adolescents showed basement, unable to support themselves the pathological levels.” increasing levels of pathological gaming financially or get a job because of their Journal Reference: symptoms throughout the study. fixation on video games. At least in their Sarah M. Coyne, Laura A. Stockdale, The results suggest that while about 90 early twenties, pathological users of video Wayne Warburton, Douglas A. Gentile, percent of gamers are not playing in a way games appear to be just as financially stable Chongming Yang, Brett M. Merrill. that is dysfunctional or detrimental to the and forward-moving as gamers who are not Pathological video game symptoms from individual’s life, there is still a sizable minor- addicted. ity who are truly addicted to video games “I really do think that there are some adolescence to emerging adulthood: A 6-year and suffer addiction symptoms over time. wonderful things about video games,” Coyne longitudinal study of trajectories, predictors, These findings also go against the ste- said. “The important thing is to use them and outcomes. Developmental Psychology, reotype of gamers living in their parent’s in healthy ways and to not get sucked into 2020; DOI: 10.1037/dev0000939 l

Steve Jackson Games, Inc. v. inXile Entertainment, Inc. (T.T.A.B 2019)

By Stephen Sharbaugh, GWLaw 2L licensed or created by SJG, a confusion also pointed out that both SJG’s games of source. In analyzing the trademark’s and inXile’s proposed games were vehicu- rademarks serve as effective tools of confusion of source, the TTAB first lar combat games in a post-apocalyptic communication. In the gaming in- T examined the strength of the mark and setting. Furthermore, because it is com- dustry, many gamers are strongly drawn to its distinctiveness. If a mark was found mon within the industry for trademarks certain marks because of association with to be merely descriptive of the games, to be licensed from makers of video games previous games that they have enjoyed. inXile Entertainment (inXile) attempted to take advantage of this phenomenon in filing for registration of the mark AUTODUEL for computer games. AU- TODUEL had been first used by Steven Jackson Games, Inc (SJG) in 1982 for digital publications that supplemented SJG’s table-top combat game, “Car Wars.” To inXile’s disappointment, on January “In analyzing the trademark’s confusion of source, the TTAB 22, 2019, the Trademark Trial and Appeal first examined the strength of the mark and its distinctiveness.” Board (TTAB) denied inXile’s registration on the basis that consumers were likely to be confused about the source of their computer games. In defending its registration, inXile argued that SJG had abandoned its registration of the mark, AUTODUEL, because it had no longer licensed the then SJG would have a lower threshold to makers of tabletop games, and vice mark for use on computer games, which of trademark protection, but the TTAB versa, their markets seem intertwined to SJG had done previously in 1985 with concluded that the mark was suggestive, consumers in the market. Additionally, Origin Systems, Inc. In rebutting that a form of inherent distinctiveness, as it SJG made a showing of confusion by claim, SJG expressed to the TTAB that was attached to a game in which cars demonstrating actual confusion among they had made continuous use of the “duel” each other. market consumers shown in a twitter mark in selling their AUTODUEL The TTAB also examined the similari- feed. These facts all supported the notion QUARTERLY publications (since 2005), ties in the marks and concluded that the that there was a strong likelihood that GURPS AUTODUEL world books, and marks, as used by the companies, were consumers would confuse the source of AUTODUEL AMERICA maps. The practically identical. inXile attempted to inXile’s AUTODUEL game with SJG TTAB found that these products, which argue that there was a lack of similarity as and thus that the registration by inXile served as supplements to SJG’s table-top SJG used the mark within combination should be denied. games, constituted sufficient use of the with other words such as “quarterly” and This holding serves as an important mark and thus precluding inXile from “gurps.” Unconvincing to the TTAB, the reminder to companies in the gaming registration of that mark. Board expressed its view that the “focus” industry that when deciding on a mark In SJG’s opposition, they believed of the mark was still AUTODUEL. Words for a future video game, it is imperative that inXile’s use of the mark AUTO- such as “quarterly” and “gurps” served that publishers and developers examine DUEL would cause confusion in the merely as description. The TTAB further not only existing video games but also marketplace. Consumers may believe that concluded that the parties used similar other related games, such as tabletop or computer games created by inXile, under channels in selling the goods and sold the card games to help ensure that they will the AUTODUEL mark, were in fact goods to similar consumers. The TTAB be granted trademark protection. l

Summary Judgment Granted to Game Publisher in Tattoo Copyright Case

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The court granted Take Two’s motion, finding a lack of infringement based on several grounds. First, the court held that Take Two’s use of the tattoos was de minimis, precluding a finding of substantial similarity between the video game and the copyrighted work. “This decision has substantial implications for the scope of The tattoos appeared only on the players possible copyright protection for ‘identifying’ works of art as upon whom they are actually inked—just used in video games.” three out of over 400 available players. Even when such players are selected in the game, the tattoos are small and indistinct, often blurred as the figures move rapidly across the virtual court. The video game renderings of the tattoos were also greatly reduced, ranging from 4.4% to 10.96% was created for the players to express game’s use of the tattoos. of the size of the tattoos in real life. themselves. Take Two, by contrast, used This decision has substantial implica- Second, the court found that Take the tattoos to identify the video game tions for the scope of possible copyright Two was authorized to display the tat- figures as the players. protection for “identifying” works of toos under an implied license. In doing Analyzing the remaining fair use fac- art as used in video games, even beyond so, the court found that (i) each of the tors, the court found that the tattoos were tattoos on athletes. Indeed, as games three players with the tattoos at issue re- not particularly creative or expressive continue to become more realistic, and quested the creation of those tattoos; (ii) because they comprised predominantly as the line between the virtual and real the tattoo artists accordingly created the common motifs and factual elements, world blurs with the rise of augmented tattoos and delivered them to the play- weighing against fair use. Although the and virtual reality games, it is likely that ers by inking them onto their skin; and tattoos were copied in their entirety, the more real world works of art will begin (iii) the tattooists intended the players to court found that this did not weigh against to appear in video games. The court’s copy and distribute the tattoos as part of fair use because such wholesale copying fair use analysis, and in particular its their likeness, knowing that the players was necessary “to effectuate the transfor- transformative use discussion, suggests were public figures likely to appear in the mative purpose of creating a realistic game that when such works are replicated in a public in various forms of media. experience.” Solid Oak Sketches, LLC v. 2K game to identify a person or locality, the Third, the court agreed that Take Two’s Games, Inc., No. 16-cv-00724-LTS-SDA, copyright owner may face challenges in use of the tattoo images constituted fair at 21 (S.D.N.Y. filed Mar. 26, 2020). establishing infringement. Further, the use. Despite the game’s commercial na- Finally, due to the transformativeness of suggestion that an implied license may ture, the court found that the purpose the work, Take Two’s use did not serve as be found where an artist working on and character of Take Two’s use was a substitute for the actual tattoos. Nor did commission knew (or potentially should transformative and therefore weighed in the court find evidence of a market for have known) that their art may be pub- favor of fair use. Each of the tattoos has licensing tattoos for use in video games, licly reproduced could limit the scope of a meaning personal to the players, and let alone one that was impaired by the protection for such “public” works. l

News Briefs

Midwest Esports Expands National Gaming Division I institution to add Esports as a varsity program. In Footprint with Upsurge Acquisition the first year of competition, the Huskies will add four teams in Midwest Esports, a Wichita, Kansas-based leader in esports expe- Overwatch, League of Legends, Rocket League and Hearthstone. riences for collegiate, youth, hobbyists and amateur video game “We felt the timing was right to add Esports as an intercollegiate players, has acquired Upsurge Esports. The acquisition supports sport at Northeastern University,” said Jeff Konya, director of athlet- the company’s “ongoing efforts of streamlining national awareness, ics and recreation. “The interest in competitive gaming across the participation, advancement and opportunities for players, spon- country is skyrocketing among teens and our Esports club teams sors and spectators within the immersive online gaming arena.” have proven to be some of the best in the country. This addition Ramsey Jamoul, founder and CEO of Midwest Esports, added to our athletics brand will expand our engagement opportunities that he has appointed a new Chief Operating Officer, Benjamin and utilize an emerging market for strategic recruitment.” Redington, to his executive team. “The position was created in Konya singled out his administrators as well as Director of the response to the organization’s continuing growth and expansion, Esports platform Nick Avery “for helping to bring this excellent with Redington now having a greater focus on overarching business opportunity to fruition.” operations, organization, and employee resources. Transitioning Northeastern already has a successful history in esports. Its club from the Chief Marketing Officer role, he will now be responsible teams captured the Rocket League national championship in 2017, for operations management and will identify new areas of employee placed in the top four in the Collegiate Rocket League Eastern services, resources and benefits.” Division in 2018, and continued to be one of the top teams in the northeast in 2019-20. The Huskies tallied a second-place finish LAFC Teams Up With Allied Esports To in Hearthstone at the National Varsity Division this past spring. Produce LAFC Gaming Charity Challenge “We have seen this program grow rapidly over the last few years Series at Northeastern and from there they have succeeded on a national The Los Angeles Football Club (LAFC) and Allied Esports, a lead- level,” said Avery. “We were blown away when we saw that the ing esports entertainment and production company, announced national championship for League of Legends had a larger viewer- today an agreement to produce the LAFC Gaming Charity Chal- ship than the Super Bowl.” lenge Series – a 10-game FIFA20 series streamed live on twitch. tv/lafc to support Los Angeles-based charities in their fight against University of Utah’s Top-Ranked Games COVID-19. Program Held Virtual Graduation in Online Launched on March 29, the LAFC Gaming Charity Chal- Videogame lenge Series has raised over $6,500 through fan donations during The University of Utah’s nationally ranked video game develop- two broadcasts. Fans are encouraged to continue to tune in and ment program, Entertainment Arts & Engineering, held its 2020 donate to help support the LAFC Foundation and its work with graduation ceremony on May 1 in an online video game students numerous charities fighting COVID-19. For more information created. The game, similar to a massively multiplayer online game, on how to donate during the coronavirus outbreak, please visit allowed students to log in and control a 3D avatar of themselves LAFC.com/Foundation. marching through the ceremony. “Producing LAFC’s online FIFA broadcasts allows us to support “We needed to have something special for the students because the team and the important push to raise money for the people this may be the end of their academic careers, and we wanted them on the front line of this pandemic,” said Jud Hannigan, CEO of to leave on a high note,” said University of Utah School of Com- Allied Esports. “Our transition to online production and events puting professor Robert Kessler, who is also EAE’s co-founder and has opened the doors to a number of new relationships, and we’re executive producer of the virtual event. “And we’re games people, thrilled to serve LAFC’s loyal fanbase during a time when positive so we said, ‘Let’s make a game.’” spirit and community is crucial for us all.” Torque Esports, Frankly, And WinView Enter Northeastern Elevates Esports to Varsity Into Business Combination Agreement Program Torque Esports Corp. (TSX-V: GAME) (OTCQB: MLLLF) Northeastern University will become the first New England area See NEWS BRIEFS. Page 12

News Briefs

Continued From Page 11 (“Torque”, formerly Millennial Esports Corp.), Frankly Inc. With the two Cornell College esports, the varsity rosters consist (TSX‑V: TLK) (OTCQX: FRNKF) (“Frankly”), and WinView, of 25 students, but many more students participate in the program. Inc. (“WinView”) have entered into a business combination The student involvement per block ranges from 50–80 students. agreement (the “Business Combination Agreement”), pursuant Sheehan is actively recruiting team members for the future of to which Torque will acquire each of Frankly and WinView (the the program with the possibility of earning scholarships to play “Transaction”), which will create an integrated platform dedicated with the Cornell Esports Team. to live esports, news and gaming. The combined company, to be called Engine Media Holdings, Simplicity Esports and Gaming Company Inc. (“ENGINE”) [Esports, News, Gaming, Interactive Network, Announces Partnership with University of Engagement], will be co-led by Torque Esports CEO Darren Cox North Carolina Charlotte’s Niner Esports to and Frankly CEO Lou Schwartz. WinView Executive Chairman Host Online Tournaments Tom Rogers, who also serves as Chairman of Frankly, will serve as Simplicity Esports and Gaming Company (OTCQB: WINR) Executive Chairman of ENGINE. (“Simplicity Esports”), a brand within the esports industry, as well as ENGINE “will be the first public entity devoted to driving owner and manager of multiple esports teams, an operator of Esports new sources of revenue for sports, esports and news content, with Gaming Centers, and online tournaments, has announced today a set of businesses covering various elements of the esports sector, that it is partnering with University of North Carolina Charlotte’s gaming related to live sports events, content management and Niner Esports to present multiple esports tournaments online. streaming services, data-driven advertising sales, and intellectual Simplicity Esports is “partnering with Niner Esports to convert property covering mobile cash games of skill and sports gambling,” its previously scheduled on campus in-person flagship esports according to a press release. “The three companies bring together event to a series of multigame online tournaments,” said Roman an established set of technologies to address the burgeoning esports Franklin, President of Simplicity Esports. “Online tournaments and lifestyle gaming markets to capitalize on the growing com- exemplify Simplicity Esports’ strategy of reaching and engaging with petitor and spectator audiences that are engaging in skills-based our customer base during a time of necessary social distancing.” competitions across a wide range of games.” St. Mary’s University Launches Varsity Cornell Expands Esports Program with League of Legends Esports Program in San Antonio St. Mary’s Athletics will launch an esports program this fall, Director Mount Vernon, Iowa-based Cornell College’s esports program is expanding into a new esport, following a successful first semester of Athletics Robert Coleman announced earlier this year. As such, competing in Overwatch. St. Mary’s will be the first university in San Antonio to sponsor a Head Esports Coach Mayson Sheehan held tryouts and has varsity Esports program. built a varsity team for League of Legends. The team will battle The program will compete in the newly created Rattler Esports against other colleges in the Riot Scholastic Association of America Arena in the heart of campus. The University is renovating space (RSAA), which is organized by Riot Games–the developer of with amphitheater-style seating on the second floor of the University League of Legends. Center to become the team’s home. While League of Legends is new to Cornell, it’s not new to Shee- In addition to housing the varsity Esports team, the venue will han. He was ranked in the top 0.5 percent of players in America provide opportunities for students to participate in competitive for League of Legends by the age of 21. gaming through the intramurals program or to convene for casual “It feels like a return home for me,” Sheehan said. “While I gaming. dearly love Overwatch and coaching it, League of Legends is my The St. Mary’s Esports program will join two esports organiza- true love in esports. So, I am very excited to have another good run tions, the National Association of Collegiate Esports and Tespa. in a different title. League of Legends is a much more established Through these organizations, student-athletes will compete online collegiate esport, however. So, the competition will be much fiercer. against students from other universities and colleges of all sizes We began competition on Jan. 26 and play every Saturday until in games that could include Rocket League, League of Legends, March 1, then playoffs will start.” Super Smash Brothers Ultimate and Overwatch, among others.