Lawsuits Against Game Developers: 5 Real Cases from the Video Game Industry
Two class action lawsuits are currently running against CD Projekt RED, the developer studio behind “Cyberpunk 2077”, because of the numerous post-release problems of the game. But it’s not only large developer studios, independent video game developers are also not immune to lawsuits for copyright infringement, trademark infringement or personal rights violations or disputes with investors. Today we’re going to introduce you to five real cases where game developers had to defend themselves in court.
Cyberpunk 2077: after the Big Hype Came a Deep Fall
The hype was huge: After three postponed release dates, “Cyberpunk 2077”, originally planned for April 2020, was finally released on December 10th, 2020. But the joy didn’t last long for the fans. CD Projekt RED, the developer studio behind "Cyberpunk 2077" released a game that was not only full of errors that interfered with the flow of the game, but also had massive performance problems on PlayStation 4 and Xbox One. The game kept crashing and basically couldn’t be played on these consoles, so much so, that Sony finally took “Cyberpunk 2077” out of the PlayStation Store in January 2021 and offered players a refund of the purchase price. That is something that had never happened before.
But it wasn’t just the video game fans who were disappointed and angry about the botched start - the whole thing now also has legal consequences for CD Projekt RED: There are now two class action lawsuits against the Polish developer in the USA. The plaintiffs in both cases are two major law firms that represent investors in the game. They claim that CD Projekt RED brought funders on board with false facts, because the game that was announched did ultimately not exist. Meanwhile, Polish the consumer protection authority is also interested in the “Cyberpunk 2077” debacle. So far, however, there has been no lawsuit, only questions about the steps the developer studio is taking to resolve the problems with the game and how complaints from the players are dealt with.
Lawsuits in the Video Game Industry are not Uncommon
No one knows yet how the whole thing will turn out for CD Projekt RED. In view of the lawsuits, the development studio was combative and issued a statement that it would “vigorously defend itself against the lawsuits”. Meanwhile, the developers are working on fixing the bugs in “Cyberpunk 2077”, there has already a been a major patch, and a second one has already been announced. The Polish game developers are not the first to be sued. In fact, it happens more often than you might think – for a variety of reasons. We picked out four major cases from the last few years:
# 1 Soccer Star versus Riot Games
So-called “skins” are published on a regular basis in the online game “League of Legends”, these are buyable alternative versions of the playable characters (champions) in the game. One of these skins was called “Striker Lucian” and gave the champion Lucian a footballer outfit. It’s something that the former Dutch soccer player Edgar Davis didn’t like at all, because Striker Lucian looked very much like him with his glasses and long dreadlocks. He sued the development studio behind “League of Legends”, Riot Games, because of the obvious resemblance between him and the skin – and won: A Dutch court ruled in his favour in 2018. Riot Games had to pay damages to Davis in the amount of the revenue generated with the skin “Striker Lucian”.
# 2 Lindsay Lohan versus Rockstar Games
In “Grand Theft Auto V” (GTA V for short) there is a character called Lacey Jonas, who is also shown in a tight bikini on numerous advertising materials for the game. US actress Lindsay Lohan found that the character’s gestures and clothing were very similar to herself and saw it as a caricature of her. That’s why in 2013 she sued the developer studio Rockstar Games and the publisher Take Two Interactive for damages. Five years and two lost trials later, Lohan ultimately failed in 2018 in the federal appeals court in New York. The court ruled that the character and its portrayals were “nothing more than a cultural commentary” and that the actress had not suffered any harm as a result.
#3 Players against Niantic
It could all have been so good: In the summer of 2016, Niantic had THE hit game of the year – “Pokémon GO” for smartphones and tablets. For the one-year anniversary of the game, Niantic held a fan festival in Chicago in 2017, but due to technical and logistical problems, the festival turned into a fiasco. In order to appease the angry fans, Niantic first reimbursed the ticket prices and gave affected participants in-game currency worth 100 US dollars, but for many that wasn’t enough. This led to a class action lawsuit in which the participants demanded reimbursement of additional costs, such as for flights, hotels or parking fees. In May 2018, a court ruled in favour of the plaintiffs and Niantic was forced to pay 1.575.000 US-dollars to reimburse additional costs.
# 4 Sky versus Hello Games
Hello Games, the development studio behind the game “No Man's Sky”, was subject to a lawsuit from the television company Sky in 2013. Reason: Infringement of trademark rights. What sounds absurd at first – after all, it’s pretty unlikely that people would confuse “Sky” with “No Man's Sky” – isn’t as simple as it sounds. That’s because as a matter of principle, a company must ensure that the rights to its own name are preserved, as their rights may otherwise be endangered. In the case of Hello Games and Sky, however, there was a happy ending: Shortly before the release of “No Man’s Sky” in 2016, the dispute was settled and the game was allowed to keep its name.
# 5 Wrestling Star versus Activision
The wrestling star Booker T. Huffman sued Activison in February 2021 because of the similarity of the game character Prophet in the game “Call of Duty: Black Ops 4” and a cartoon character named G.I. Bro. Based on one of his previous wrestling characters, Huffman created the character G.I. Bro in 2015 for a comic book series and also promoted it at various comic book events. Now he is suing Activision for damages for infringement of trademark rights. The verdict is currently still pending.
Excellent Insurance for (Game) Developers from exali
As you can see, there are many different reasons why (game) developers can be sued: for infringement of trademark rights (e.g. Sky versus Hello Games), copyrights (Huffman versus Activision), personal rights (Davis versus Riot Games, Lohan versus Rockstar Games and Take-Two Interactive) or because of a botched event (e.g. player versus Niantic).
All of the above cases can be fully insured with Professional Indemnity Insurance from exali, unless they were caused deliberately (which is unlikely due to the factual context). In any case, the insurer checks at its own expense whether the claim is justified, defends against unjustified claims and provides compensation payments that are justified. Do you have questions about the right insurance protection for your IT business? Then just give us a call – you can reach our customer service Monday to Friday from 9 a.m. to 5 p.m. at +49 (0) 821 / 80 99 46 - 0.
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