eSports – Are Your IPRs Protected?

Authors: Emilia Uusitalo

Yesterday our IP and Technology team attended the second HEL Tech event this year, with Gaming and eSports being the topic. Hannes Snellman is one of HEL Tech’s main co-operation partners, and hence, we have a box seat to attend these topical seminars and discussions with the participants.

The eSports topic was particularly exciting, as it combines my two favourite topics: sports and complex legal issues, IPRs in particular.

eSports means electronic sports, which is a form of competition using video games. eSports are played and competed very similarly to original sports e.g. having huge tournaments, national teams and training programmes. eSports are not a new thing, but the subject is experiencing a bigger than ever hype. In yesterday’s eSports discussion, which was led by Santeri Everi (chairman of the team Helsinki REDS, HIFK), we learnt that the streaming service of eSports, Twitch.tv, nowadays has more viewers than Netflix and HBO combined. Additionally, the tournament arenas and stations are sold out around the globe. Since eSports is constantly increasing and involving a growing number of professional players and money, it raises a bunch of legal questions starting from the taxation status of the professional players, to questions concerning several intellectual property rights issues regarding the games and the eSports tournaments. The IPR issues related to the tournaments are a key issue and affects the revenue share and the overall decision power of the key stakeholders in the tournaments.

When discussing an eSports tournament, the major difference in comparison to traditional sports, is that a private game company usually holds the rights to the game itself. The game company’s extensive right of decision concerning game utilisation affects the whole nature of the games in eSports as, for example, most of the game rules are built into the game. The game company also has a right to decide to whom the game may be licensed to, for what kind of use and subject to what restrictions and compensation. The game company also has a say on the streaming, broadcasting and marketing of the tournament using its game.

Not to make it too easy, even the game itself may include rights of several different stakeholders, including e.g. coders, a game designer, a third party developed component and server providers (just to name a few), whose rights the game company must acquire by transferring the rights to itself or getting an adequate license for them. As some parts of the games are usually in-licensed by the game company, such licenses may include restrictions or conditions of use of the game even by the game company itself.

The most relevant Finnish IP law related to software and games would probably be the Finnish Copyright Act, which entered into force in 1961. Although it has thereafter been partly modernised, the legislator has probably not been able to predict these kind of issues back in the days of the enactment of the Act. As a main principle, the copyright law strongly protects the copyright holder, especially in connection with commercial use of a copyright protected work. In addition to copyright protection, if the game company or its licensors have taken good care of their IPRs, they most likely hold some trademarks related to the game, which may not be used commercially without a permit of the right holder.

However, as an eSports tournament involves a lot work and contribution from several entities, including the organiser, the marketers and naturally, the eSports athletes, it is also important for them to know what rights they have and on the other hand, to have the ability to protect and exploit any IPRs belonging to them. It is possible that such entities produce in connection with the tournaments some copyright protected derivative works, which, however, may not be exploited without a permit of the right holder of the original copyright protected work. In addition, as sports is the topic, the circumstances related to the tournaments should be fair to all the players irrespective of who is the right holder of the game itself.

In this complex standing, agreeing on rights and responsibilities between the parties becomes extremely important, especially as the law does not provide clear rules on rights to manage and exploit IPRs that may be overlapping with the IPRs of someone else. A good and clear agreement brings mutual benefits for all parties and composes a good basis for a long-lasting and profitable cooperation.

As usual, we IP, technology and sports enthusiasts here at Hannes Snellman are happy to help you with your agreements, IP protection and any other related legal questions you may have.