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During the first few months of the COVID-19 lockdown, with virtually all major sporting events cancelled, sports betting and gambling companies turned their eyes toward the esports universe in search of a solution. While initially large scale esports events were also cancelled, professional gaming competitions soon began taking place online. As one of the only professional “sports” competitions being broadcasted with any consistency, esports competitions filled the gap for many sportsbook operators.
Online bookmakers that specialize in esports, such as Luckbox and Unikrn, caught the first wave of esports betting explosion, reporting incredible growth in total bets placed on their
Continue Reading The Rise of Esports Betting

The allegations of gambling issues with games continues. Last week, a class action lawsuit was filed against  Apple relating to games in its App Store that include loot boxes. The complaint alleges that sale of such games are predatory practices enticing consumers, including children, to engage in gambling and similar addictive conduct in violation of California law. The suit alleges that loot boxes are like Vegas-style slot machines and allegedly constitute illegal slot machines when played on an iPhone or similar device.
California Penal Code § 330(d) broadly defines an unlawful “slot machine or device” as:
a machine, apparatus, or
Continue Reading Players Sue Apple Over Loot Boxes

Musicians and gamers are no strangers to each other; the two industries have been capitalizing on the crossover of their respective fan bases for nearly a decade. Although these collaborative efforts are not news, the utility of virtual and remote fan engagement has been re-contextualized in the wake of the COVID 19 pandemic. As the average musician derives the overwhelming majority of their revenue from live performances, technologies that can simulate these experiences have taken on a new importance virtually overnight.
Marshmello’s performance within the game Fortnite at the beginning of 2019 revealed how the synergy between music and gaming
Continue Reading The Esports and Gaming Industries Offer Vital Tools to Musicians in the Wake of COVID-19

On Thursday April 30, 2020 U.S. Senators Ted Cruz and Josh Hawley announced their intent to introduce the ” Countering Chinese Attempts at Snooping ” Act,  with the goal of “… Banning U.S. Officials from Using Tencent, … [and] Other Chinese Communist Party-Backed Platforms.” Specifically, the legislation requires that the company that creates the prohibited technology be “domiciled in the People’s Republic of China or subject to influence or control by the Government of the People Republic of China or the Communist Party of the People’s Republic of China” (“China”).  Given Tencent’s investments and involvement in some of the
Continue Reading Proposed Anti-Spying Legislation May Not Be Cause for Alarm for Gamers in Congress

Fortnite streamer Soleil “Ew0k” Wheeler signed on as a brand ambassador for HyperX on April 29, a sponsorship deal that will see the female gamer exclusively use the manufacturer’s products while streaming.

The pact between 14 year old Wheeler – a prominent influencer recognized by Forbes 30 under 30, Teen Vogue’s 21 Under 21 and the recipient of the Golden Joystick Award for Best New Streamer in 2019 – and HyperX was brokered by her agency, A3 Artists Agency.
“As a young female gamer, I feel it’s important to show others that there are no limits to what you can
Continue Reading Fortnite Streamer Ewok Pens Sponsorship Deal with HyperX

There has been a wave of celebrity lawsuits against game companies over in-game dance moves allegedly made famous by the celebrity. A number of legal theories have been tried, including trademark, copyright, right of publicity, misappropriation of likeness, etc. Nearly all of these claims have failed. A recent decision from the Eastern District of Pennsylvania granted a motion to dismiss on seven of eight counts brought. The sole surviving count relates to a false endorsement claim under the Lanham Act. Leo P made two claims under the Lanham Act, the second being for false designation of origin was dismissed by
Continue Reading Recent Case Law May Open New Celebrity Dance Suits Against Game Publishers

The Washington State Federal District Court recently issued a decision stating: “Washington’s definition of ‘gambling’ only reaches ‘staking or risking something of value upon the outcome of a contest of chance or a future contingent event not under the person’s control or influence’ and that “[m]ost games not derived from casinos involve some amount of skill and would thus be unlikely to meet the statutory definition.”
While this is not new law, it is very much a positive for traditional video game companies that offer games to players in Washington state. Washington has been a hot bed for gambling lawsuits
Continue Reading Most Non-casino Style Games Unlikely to be Gambling in Washington

In a controversial decision, the Illinois Supreme Court determined that a head-to-head, daily fantasy sports (DFS) contest was predominately skill based and thus not gambling. Despite agreeing with the appellate court’s conclusion that the DFS contest at issue was not gambling, the Court disagreed with much of the appellate court’s reasoning.
The case was a gambling loss recovery matter where plaintiff sought to recover his losses from another player in a head-to-head DFS contest. The Court focused its analysis on whether the DFS contest was a “bona fide contest for the determination of skill.” After noting that the Court
Continue Reading Daily Fantasy Sports Case Skillfully Comes to a Head

Microsoft has announced a partnership with Enjin to offer a blockchain based recognition program. Azure Heroes aims to reward individuals for verifiable acts of impact such as coaching, creating demos, building sample code, blogging about Azure or completing certain challenges. Community members that have demonstrated their contributions will be recognized with badges across a number of categories. Azure Heroes is branded as a new and fun way to earn digital collectibles for meaningful impact in the technical community.
The Azure Heroes badgers were created in a number of original and unique designs which have been tokenised into a digital asset on the
Continue Reading Azure Heroes – Microsoft Partners With Enjin to Offer Crypto Collectible Rewards

System art is of increasing importance in patent disputes despite being frequently overlooked or “left for later” in many cases.  A recent decision in the Ironburg Inventions v. Valve Corp. case highlights the importance of system prior art, particularly as IPR success rates have dropped from their high points in 2012-15.
Continue Reading Left Empty Handed: Valve Shut Down on Written Prior Art, Highlighting Importance of System Art

Money laundering is no game. Yet, some games have been used for money laundering. That’s what prompted Valve to announce that it would end the online sales of loot box “keys” for its game Counter-Strike Global Offensive (CS-GO).

As of last week, Valve indicated that CS:GO container keys purchased in-game can no longer leave the purchasing account. Thus, they cannot be sold on the Steam Community Market or traded. Pre-existing CS:GO container keys are unaffected–those keys can still be sold and traded.

These CS-GO keys have historically been traded on the Steam Community Market as well as third party websites.
Continue Reading Laundering the Loot: Videogame Developer Valve Ends In-game Key Sales Because of Financial Criminal Activity

Earlier this month, a set of gaming industry representatives agreed upon and released a set of unifying esports principles. These representatives include the Entertainment Software Association (ESA), as well as associations from Canada, Australia and New Zealand, the UK, and Europe. These “Principles of Esports Engagement” were developed in a collaborative effort and form a set of values applicable in all aspects of the global esports environment.
Continue Reading Gaming Industry Associations Agree on Universal Esports Principles

Last fall, the PTAB modified its procedures for IPR claim construction, eliminating the use of the broadest reasonable interpretation standard. Since the rule change last year, companies challenging the validity of patents at the PTAB are required to use the Phillips plain and ordinary meaning standard.
Continue Reading “Addressing Video Game Claims Under the Phillips Standard at the PTAB”

As real-world celebrities continue to expand the reach of their persona into the digital realm, the potential benefit for advertisers, game developers and esports event promoters is exceedingly high. But with increased opportunity comes increased risk.

A New York Supreme Court recently addressed this risk when it construed the State’s right of publicity statute[1] in a dispute over an NBA 2K18 video game avatar. In Champion v. Take Two Interactive Software, Inc., celebrity basketball entertainer Phillip “Hot Sauce” Champion sued the video game developer, alleging violation of his right to privacy for Take-Two’s use of his name and
Continue Reading Celebrity Entertainer Sues Over Video Game Avatar

*This article was originally published in Law360 on June 8, 2019.

Electronic sports, known in the industry as “esports,” has seen remarkable growth in the last decade. The term “esports” refers to the growing world of competitive, organized video gaming, where professional video gamers play on a variety of different video game platforms and video games (“esports titles”) in heavily attended and publicized competitions and tournaments. These competitions are watched by millions of fans across the globe on TV or online, and by others who attend live esports events. Expert projections have shown that this year will be especially significant,
Continue Reading 10 Labor and Employment Considerations in Esports*

In a closely watched case, a New Hampshire federal court has ruled that the Wire Act is limited to sports betting and set aside the DOJ’s recent opinion to the contrary. However, it limited the scope of its declaratory relief to the parties and deferred a decision on whether to extend the declaratory judgment to non-parties on behalf of the Lottery Commission, but gave the Lottery Commission 14 days to file an appropriate motion and supplement the record with adequate factual and legal support on that point.
Continue Reading Federal Court “Discards” DOJ Interpretation Of Wire Act