What Every Lawyer Should Know About. Esports. Brandon J. Huffman Odin Law and Media

Transcription

1 What Every Lawyer Should Know About Esports Brandon J. Huffman Odin Law and Media

2 First things first: Spelling Program says esports incorrect. Don t do this. Industry norm: esports Associated Press 2017 American Copy Editors Society Convention: esports

3 What does esports mean? Competitive video games More broadly, spectator gaming

4 Why should I care? 2018 esports globally is a ~$1bn revenue industry. 380M viewers 75% of audience is between 18 and 34 For context: traditional sports in North America is ~$70bn. Sources: iab, NewZoo, PwC

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6 Examples Overwatch

7 Examples League of Legends

8 Industry Overview Publishers 2K Games (NBA 2k, etc) Activision/Blizzard (Overwatch, WoW, CoD, Hearthstone) Capcom (Street Fighter) EA (FIFA, Madden NFL) Epic Games (Fortnite) Hi-Rez Studios (SMITE) NASCAR / 704 Games (NASCAR HEAT) Nintendo (Smash Brothers, Splatoon) Psyonix (Rocket League) Riot Games (League of Legends) Valve (DOTA 2, Artifact) Warner Bros. Interactive (Mortal Kombat) Leagues, Tournaments CSL (college) DreamHack ELEAGUE ESL Evolution Championship Series (Evo) FIFA Interactive World Cut Hearthstone Championship Series League of Legends (Franchise) Madden NFL Cup Championship NASCAR HEAT Pro League NBA 2K League (Franchise) Overwatch League (Franchise) Rocket League TESPA World of Warcraft Mythic Dungeon Teams & Orgs Esports native Cloud9 Counter Logic Gaming Digital Chaos Evil Geniuses OpTic Gaming Team EnVy Not Native Cleveland Cavaliers (LoL 100 Thieves) Dallas Mavericks Golden State Warriors (NBA 2K Warriors) NY Mets (Overwatch NY Excelsior) Talent Players Shoutcasters Entertainers (not competitive) Media & Platforms Traditional ESPN CW Turner NFL New Twitch Facebook Mixer MLG Twitch Twitter YouTube Venues Esports native Blizzard Arena (CA) Esports Arena (NV) MLG.tv Columbus (OH) Riot Battle Arena (CA) Populous Arena (TX, planned) Not Native: Madison Square Garden (NY) Staples Center (CA) Key Arena (WA) Other Ad Agencies (Mindshare, Scout, Zero Code) Research Companies (ComScore, FanAI, GumGum Sports, Interpret, NewZoo, SuperData, Nielsen) Lawyers Accountants CPAs Insurance

9 Legal Issues: Governance Like traditional sports: Each game has a different structure Each level has a different structure (amateur, collegiate, professional) Unlike traditional sports: Game publishers have a big say (copyrighted game) Tournament organizers / leagues have influence on content Cross-discipline groups emerging: World Esports Association Esports Integrity Coalition

10 Legal Issues: Licensing Games have to be licensed from publishers 17 USC 106 Exclusive Rights include public performance Games include EULAs restricting use Key terms: scope, fees (including royalties), term, termination, restrictions Emerging Issue: who owns individual performances? Data? Debate around whether an individual players execution of in-game acts can be creative Debate in traditional sports around player data extends to esports, data is more plentiful In both cases, answer probably lies in agreements (publisher influence)

11 Legal Issues: Labor Player relationships with teams, sponsors and leagues Is player an employee or contractor? (generally contractor) What rights does player have / how does player get paid? Revenue beyond play: Twitch monetization, sponsorships, appearance fees Key terms in player contracts: Term Control (team apparel, food, stream channel, housing) Compensation & Benefits (salary, signing or other bonuses, insurance, food, lodging, relocation assistance, support) Prize Money (how divided, how calculated) Termination (including morals clauses) Marketing rights (TM, Persona) and obligations League rules incorporated? Immigration: esports is inherently international Minors

12 Legal Issues: Teams Franchise v. Non-Franchise Team Structure (Internal) Usual corporate questions Control Team Agreements (External) Team IP Sponsors League Other Organizers Team Ancillary Players

13 Legal Issues: IP in One Event (e.g.) Game Developer Game IP etc. Game Publisher Media Platform Platform IP (Content) Player Team League / Organizer Advertisers Player IP Likeness etc. Team IP Brand League IP Brand (Content) Advertiser IP Brand Content

14 Gambling Same analysis as traditional sports betting Murphy v. National Collegiate Athletic Association (U.S. Supreme Court, 2018) Rules that federal law prohibiting sports betting violates 10 th A. Sports betting rules state by state Additional Gambling Considerations CS:GO Skin Betting Betting on performance (skill v. chance) Loot Boxes

15 Questions? Brandon J. Huffman Odin Law and