Mitigating IPR Conflicts Under Sports Law: An Analysis of the Esports Industry

-Vaishnavi Venkatesan
Symbiosis Law School, Pune
[email protected]

The sports industry is a multi-billion-dollar global market in terms of revenue and

employment.1It is a common occurrence wherein sporting events are stereotypically
associated only to cricket or football. However, gone are the days when cricket was a
synonym to sports in India. Other forms of sports, particularly esports have been re-writing
its growth abundantly. Owing to rapid technological advancements in the twenty first
century, there has been a wave of digitization with internet becoming ubiquitous in our
everyday lives. The Covid-19 pandemic has had a negative impact across multiple sectors,
inevitably affecting the sports industry as well. This could be a major defining feature, post
which the way sports are played and perceived will shift to a great extent. As seen from other
sectors like education, e-commerce etc, internet and technology can prove to be the knight in
shining armour in the realm of sports also. Consequently, the need of the hour is to focus on
this inordinately emerging class of esports and resolve conflicts pertaining to Intellectual
Property rights of various stakeholders.

The dawn of this vocation has been accompanied by the development of a nascent
professional structure with aspects similar to that of physical sports and entertainment,
including tournaments, leagues, fans, teams, team owners, player contracts, sponsors to name
a few.2 A small pool of commentators are of the opinion that esports are categorically
dissimilar to traditional sports, entailing different characteristics leading to it not being
categorized as a ‘sport’3, however there exists numerous similarities between the two that
sufficiently confirms that esports fall under the sports domain.

Esports vis-a-vis Traditional Sports.

The Oxford English Dictionary defines sports as “an activity involving physical exertion and
skill in which an individual or team competes against another or others for entertainment.
Based on this definition, numerous commentators argue that esports does not involve
1
Liam O’Connell, Size of the global sports market 2018, STATISTA, (2020).
2
MICHAEL KANE, GAME BOYS: PROFESSIONAL VIDEOGAMING’S RISE FROM THE BASEMENT TO THE BIG
TIME, 133-47 (2008).
3
Jim Parry, Esports are not Sports, 13, SPORTS ETHICS AND PHILOSOPHY, 3, 3-18 (2018).
physical exertion and hence cannot be categorized as a sport. However, esports are as much a
sport as any other because they involve intensive training to ultimately ‘compete’ with others,
which is an essential factor to be considered whilst determining the status of a sport. 4
Professional esports teams put in up to 8 hours a day for training and other purposes, have
coaches, trainers, and nutritionists on staff, and players receive base salaries, just like any pro
sports league.5 In the U.S., there are roughly 50 colleges that have varsity esports teams. 6
Furthermore, there is no hard and fast rule which necessarily determines the ‘amount’ of
physical exertion which is required for such a categorization because analogically even a
‘mind’ game like that of chess or archery falls under the ambit of sports, thus negating a
narrow interpretation of the same.7 Furthermore, it is noteworthy fact that esports is also in
consideration for being included as a medal event in the 2024 Paris Olympics.8

The International Olympic Committee concluded that Competitive ‘esports’ could be

considered a sporting activity as the players involved prepare and train with an intensity
which may be similar to athletes in conventional sports.9” Furthermore, the IOC has
recognized that a competition element i.e. “the winning or losing” of an event run according
to a predefined set of rules is essential. Competitive esports must essentially fulfil that pre-
condition. There is no doubt that numerous differences exist between the two based on its
format, duration, changes in rules and financial models, however despite this, based on the
above analysis it can be categorically stated that esports is a facet of sports and falls under the
same domain.

Tussle for Power: Publishers right v. Players right to economic remuneration in Esports

The traditional sports industry is highly regulated with stringent rules and measures in place,
which lays out a clear demarcation of power and the degree of control to be exercised across
multiple areas. This complex regulatory system consequently leads to a simpler Intellectual
Property (Hereinafter IP) regime wherein stakeholders in traditional sports including
sponsors, partners, players, and broadcasters are bound by laws which operate within a set

4
James H. Frey, Sports and Society, 17, ANNUAL REVIEW OF SOCIOLOGY 503, 503-522 (1991).
5
Scott Kingdon, Performance coaching in the world of sports, SPORTS BUSINESS JOURNAL, Aug. 18, 2016.
6
Christopher D. Merwin Et al., Esports: From Wild West to mainstream, THE WORLD OF GAMES, (Oct. 2018),
7
Mark Filchenko, A Comparison Between Esports and Traditional Sports, 5, ART 108: INTRODUCTION TO
GAMES STUDIES (2018).
8
George R, Paris 2024 Olympics: Esports 'in talks' to be included as demonstration sport, BBC SPORTS, Apr.
25, 2018, https://www.bbc.com/sport/olympics/43893891.
9
Stephen Townly & Annie Townly, eSport: everything to play for, WIPO MAGAZINE, (Feb. 2018).
boundary. Occasionally, there are infringements across these areas however owing to
stringent regulation both internally as well as externally, power does not rest with a single
body or organization. Moreover, traditional sports are strictly rule bound, which have been
carefully developed through the years and are not subject to change easily. These rules are the
defining features of traditional sports.10 Whereas on the other end of the spectrum are esports,
where such stringent regulations are less adhered to, owing to aspects like the ‘update
feature’ which change the format of the game partially or completely time and again.

A captivating aspect of esports is the diversity of stakeholders. It is the integration of the

efforts of publishers of the sport along with players, advertisers, tournament organizers and
teams contributing effectively that makes esports presentable to an audience. However there
exists a general consensus that distribution of power is less divergent and predominantly rests
in the hands of ‘game developers’ or ‘publishers’ through a manifestation of protection in the
form of copyright, which provides them with exclusive rights on esports teams, leagues,
players and broadcasting deals.11 On the subject of granting exclusive IP rights to publishers,
a highly emerging pool of commentators are of the opinion that bestowing such exclusive
rights to publishers as juxtaposing traditional sports where IP rights are highly distributive,
can lead to publishers exploiting players and misusing their rights which goes against the
very purpose of incentivizing creativity, thus deterring competitiveness in esports.12 They
believe this also contravenes the fair use principle due to its restrictive nature and accentuate
on granting equal rights to players who participate in esports to maintain an equilibrium in
the domain.13

Need for Recognizing Players as ‘Authors’ in Esports?

In the discussion of the mater set forth, the author is of the opinion that even though
publishers are merited with greater copyright protection vis-a-vis players participating in
competitive esports, it is not without merit. At this juncture, it is imperative to understand the
reason for warranting such protection. Traditional sports like cricket, football or hockey are
not owned by a particular individual and have been developed historically through a certain
set of rules however esports like League of Legends or Dota 2 is the brainchild of the
10
SHAWN E. KLEIN, DEFINING SPORTS: CONCEPTIONS AND BORDERLINES, 150-153 (2016).
11
Max Miroff, Tiebreaker: An Antitrust analysis of eSports, 52(2), COLUM. J.L. & SOC. PROBS. 177, 177-223
(2019).
12
Greg Lastowka, Copyright Law and Video Games: A Brief History of an Interactive Medium, SOCIAL
SCIENCE RESEARCH NETWORK (2013).
13
Ivan O. Taylor Jr., Videogames, Fair Use and The Internet: The Plight of the Let’s Play, 1, J.L. Tech & Pol.
248, 248-270, (2015).
publisher who develops it using an algorithm and underlying code in the form of a software. 14
There is no doubt that a player, through his creativity contributes effectively to the game and
attracts fan following on the basis of choices made by him in the course of the game, however
the player operates within a bandwidth of choices available to him via the software i.e. he
may be contributing creatively to the game via a plethora of options available to be modified
in the game, but he is bound by the restrictive nature of esports where all prospects are a
result of the underlying code, created by the publisher. Even though judicial interpretation is
silent on the pertinent matter in India, courts have adjudicated upon similar underlying issues
across other jurisdictions in the past, which is vital to understand the present development.
For instance, in Stern Electronics, Inc. v. Kaufman15, the Second Circuit dealt with player
contribution in an infringement suit with respect to a video game. The defendant contended
that players were the real authors of the game’s video output.16 The court, however, was of
the view that the players generated only a variation on the publisher’s game, and declined to
consider what degree of player control would be necessary before the player would have
contributed enough to be considered an author. Subsequent courts facing the same issue
adopted a similar approach, harping on the limited number of choices available to the
player.17

Despite judicial backing, a large pool of commentators believe that players deserve equal
rights. It is at this juncture that the author seeks to draw an analogy to justify meriting
excessive rights to publishers. In a routine professional atmosphere, say a person ‘A’ asks an
interior designer to work on his indoor space and its beautification. After completion of the
work, the interior designer hands over the keys of the house to ‘A’. The interior designer does
not own the house and has merely rendered his service to A for something that belongs to
him. The same logic can be applied to understand the development in esports. The publisher
is the real ‘owner’ and developer of the game and the player participates in tournaments,
contributing effectively and their operation is restricted to boundaries provided by the
underlying code. Therefore, they cannot be recognized as ‘authors’ in the esports domain.
Even though the question of publishers right seems relatively straightforward, ambiguity

14
David Greenspan, Mastering the Game: Business and legal issues for video game developers, WORLD
INTELLECTUAL PROPERTY ORGANIZATION (2014).
15
Stern Electronics, Inc. v. Kaufman ,669 F.2d 852 (2d Cir. 1982).
16
See id. at 855.
17
Midway Mfg. Co. v. Artic Int’l, Inc., 704 F.2d 1009, 1011-12 (7th Cir. 1983); see also Williams Elecs. v.
Artic Int’l, Inc., 685 F.2d 870, 874 (3d Cir. 1982).
persists on legal aspects pertaining to modifications within the game by players and their
protection, which is a highly disputed issue in the contemporary IP regime.

Game Mods and Copyrightability Issues.

With the advent of the digital era, esports has expanded magnificently and is available in a
plethora of mediums. However, some games including a few highly popular ones, may have a
variety of defects including bad screen play, monotony, storyline issues and problems with
visual aids. Consequently, due to the wide popularity of these esports its stakeholders namely,
players or fans have in many cases taken it upon themselves to rectify these errors, creating a
modified version of these games as a result. Therefore, these players are not merely
participants in a game but are actively involved in creation of certain content. This exercise of
contribution and production to the game is known as game ‘Modding’.18 In laymen terms,
Modding involves changing or altering a game by way of its code to modify it in a required
manner.19 Modding has a wide ambit including fixing small bugs, changing graphics like
developing new avatars of characters or even building an entirely new gaming format.20 This
process involves an intersection of IP across multiple areas leading to a conflict of interest.
These Mods warrant players to adopt a character from another franchise or game to be
inculcated in the original one, however this raises numerous concerns with respect to the
publisher’s rights.

Issues pertaining to such user-generated works is a grey area in the Indian jurisprudence
however generic copyrightability issues were adjudicated upon in multiple cases, for
instance, In R.G. Anand v. M/s Delux Films 21  the court observed: “Where the same idea is
being developed in a different manner, it is manifesting that the source being common,
similarities are bound to occur. In such a case, the Courts should determine whether or not the
similarities are on fundamental or substantial aspects of the mode of expression adopted in
the copyrighted work with some variation here and there”. Moreover, in Prem Singh v Cec
Industries the court held that, “In a case where the first party himself is shown to have
18
Rafi Letzter, Online communities are changing video games to make them better, weirder, and much more
wonderful, BUSINESS INSIDER, Jul.21, 2015.
19
Christopher Pearson, The IP Implications of Video Game Mods, 9, JIPEL ENTERTAINMENT LAW,214, 2016.
20
Hector Postigo, Video Game Appropriation through Modifications Attitudes Concerning Intellectual Property
among Modders and Fans, 14, CONVERGENCE CULTURE: WHERE OLD AND NEW MEDIA COLLIDE , 59, 59–74,
(2018).
21
R.G. Anand v. M/s Deluxe Films, A.I.R 1978 S.C. 1613 (India).
adopted or imitated a copyright of a third party, then Courts can resolutely decline to step in
aid of this party because honesty of action is the crux of the matter and Courts protection is
extended only on the principle.” While specifically dealing with end user generated works,
the US court in the case of Micro Star v. FormGen Inc.22 delved upon the concept of derivate
works and held that that sequencing and arrangement of the game elements via computer
coding was recognized as a derivative work. Considering the complex nature of these works
and nascent judicial adjudication, alternative solutions are required for meriting its protection.

A possible solution could be that of ‘Creative Common licenses’ an American concept, which
allows people to build upon the work of others, use, change or modify it in various ways
without having to take permission at each instance.23 There are several versions of this
license, each of which stipulates the degree of freedom, terms and conditions at different
levels to be used by the creator. 24 For instance, in esports, the player would be able to make
creative changes to the game in multiple forms and also retain a certain degree of control on
it but this would be governed by the primary licence agreement according to the discretion of
the game developer. This fulfils the agenda of promoting creativity, to share as well as adopt
work of others and also provides a sound agreement which protects the rights of the parties
according to stipulated terms. However, this is still in limited use and its applicability to the
esports industry remains unexplored. This alternative amongst many others, can also pose
many legal challenges which needs to be taken into consideration.

Keeping in mind the derivate nature of such game mods, an important common law concept
of joint authorship has been proposed by numerous commentators as a solution to the tussle
between publishers and players who use third party IP to generate modified content.25
However, as aforementioned analysis reveals, it is the publishers who are the major
contributing force in esports and there occurs sufficient scepticism to the adopt this concept
for esports athletes, considering publishers will not be willing to share their ownership rights
conjointly. This calls for a better solution to the never-ending tussle for IP rights which would
be feasible to both parties. In light of this, the author proposes granting performance rights to

22
Micro Star v. FormGen Inc ,154 F.3d 1107 (9th Cir. 1998).
23
Jess Weichler, How and Why to Use Creative Commons Licensed Work, OPEN SOURCE, Jan.2020,
https://opensource.com/article/20/1/what-creative-commons.
24
J.R Dingwall, Licences Types, UNIVERSITY OF SASKATCHEWAN (2011).
25
Dan L. Burk, Owning E-Sports: Proprietary rights in Professional Computer Gaming, 161, PENN. LAW
REVIEW, 1537, 1537-1577 (2013).
players which is distinct and runs parallel to the publisher’s right to copyright, with a special
emphasis on moral rights to athletes who indulge in such esports.

A Middle Ground: Feasibility of Granting Neighbouring Rights to Players in Esports.

In consonance with the discussion above, the author believes that publishers merit authorship
rights as far as IP is concerned however this should not exclude player’s rights from due
consideration and leave them at the mercy of licences, salaries and remuneration granted at
the publisher’s discretion. It is at this juncture that the scope of Performers Rights plays a
pivotal role in mitigating IP conflicts between publishers and players in the esports domain.
The idea that contributions made by athletes in esports warrant recognition can be understood
by way of a simple analogy. Photographic technology involves capturing a simple moment or
fact of something that is already present or available yet the posturing of a subject, the
lighting, the camera angles and speed of exposure make the photograph a work of authorship
rather than a mechanical record of factual status.26Granting protection to creative
cinematographic or direction works along similar lines.27 Transferring this logic to esports,
the photographers here are gamers competing in competitive sports who contribute creatively
within the frameworks of the underlying source code and software, in the form of avatars,
player controls, the manner in which a player chooses to move his character, undiscovered
moves, a unique playing methodology to name a few. These meet the ‘originality’ and
‘creativity’ threshold put forth by jurists.28

This logic operates in consonance within the policy of copyright law which aims at
incentivising performers who induce creativity and enrich public discourse. Therefore, to
minimise the ever prevalent issue of power distribution between the publisher and players in
esports, it is feasible to recognize a bundle of parallel and separate rights granted to players
which would be distinct from those provided to game publishers. The concept of
neighbouring rights is not new and has been recognized across multiple jurisdictions
including India, however these have not been granted to sports persons in traditional sports as
well yet.
26
W. Joss Nichols, Painting Through Pixels: The Case for a Copyright in Videogame Play, 30, COLUM. J.L. &
ARTS 101, 117 (2007); Tyler T. Ochoa, Who Owns an Avatar?14, COPYRIGHT, CREATIVITY, AND VIRTUAL
WORLD, 959, 959-991, (2012).
27
Section 13, Copyright Act, 1957, No. 14, Acts of Parliament, 1957 (India).
28
Eastern Book Company v. D.B. Modak,101 (2002) DLT 205.
Section 38 of the copyright act, 195729 provides for Performers Rights in the Indian context.
This bestows upon performers the exclusive rights of fixation, distribution, and
communication to the public of their performances in audio-visual works. It also allows them
to seek remuneration in return for further allocation or licensing of such rights, which is
commonly known as economic rights. Another component of performers rights which
disallow modification, distortion, or mutilation of the performer’s works in order to preserve
its integrity is called moral rights.30 These also include rights of paternity and attribution to
protect the performers reputation which can be infringed by way of distortion of their work.

Performance means visual or acoustic presentation made live by one or more performers 31;
Section 2 (qq) encompasses an inclusive definition to performers which involves an actor,
singer, musician, dancer, acrobat, juggler, conjurer, snake charmer, a person delivering a
lecture or any other person who makes a performance. From a literal text analysis of the
above-mentioned definition, the author seeks to make a case to include ‘players’ who
contribute creatively to a game under the ambit of performers in the act. On a careful reading
of the description of word ‘performance’, it is clear that it includes ‘any’ visual or acoustic
presentation made live. These terms have further not been defined under the act. The oxford
dictionary further defines presentation ‘as the way in which something is offered, shown,
explained, etc. to others. This shows that any creative process visual or acoustic which is
communicated to the public is a performance. A videogame is a visual demonstration wherein
the player acts as the connecting link between the game and the public to present the same
and hence can be termed as a ‘performance’ and players can be regarded as ‘performers’.

Indian courts have recognized the rights of performers in numerous cases and upheld the
same. The court in the case of Akute Internet Seriveces Pvt. Ltd & Anr v.Star India Pvt. Ltd32
held that provisions of statute which apply to copyright would mutatis mutandis apply to
neighbouring rights including performance rights. Under Copyright act, Rights of performers
are included under sections 38 and 38A and moral rights of performers under section 57 of
the Act. Furthermore, in the case of The Indian Singers Rights Association v. Chapter 25 Bar
and Restaurant33, the court recognized the performance rights of persons who contribute

29
Section 38, Copyright Act, 1957, No. 14, Acts of Parliament, 1957 (India).
30
Section 57, Copyright Act, 1957, No. 14, Acts of Parliament, 1957 (India).
31
Section 2(q), Copyright Act, 1957, No. 14, Acts of Parliament, 1957 (India).
32
Akute Internet Services Pvt. Ltd & Anr v.Star India Pvt. Ltd, SLP (C) No. 29633 of 2013.
33
The Indian Singers Rights Association v. Chapter 25 Bar, 2016(159) DRJ244.
creatively and held that they are conferred with a bundle of rights which cannot be taken
away unless consented to.

In today’s era, where internet is at the forefront of technological development, dissemination

of humungous amounts of information with a single click of the mouse has become a staunch
reality. In this digital age of media and entertainment, it is fairly easy for creative content to
be replicated, with increased chances of distortion or modification, which directly affects the
reputation and personality of a performer. Moral Rights’ are inherent and fundamental to
every creator who needs to be recognised and accorded for his work, along with warranting
sufficient protection to prevent the misuse of the performer’s work which is an extension of
the person’s reputation, performance and charisma influencing him both on a personal as well
professional level.

Conclusion

In the current technology driven world, multiple activities are shifting from traditional
formats and adopting the virtual way of life. Especially in a world post Covid-19, this
becomes even more relevant. Esports is one such area, which has been around for quite a
while and is in fact talks for being included in the 2024 Paris Olympics as a medal event,
with the potential to contribute immensely to growth and development. However, its
legislative backing remains confined to a nascent stage. This shift towards digitization
exposes multiple grey areas and lack of clarity from the legal perspective. One of the most
prominent issues is the tussle for IP rights between game publishers and players, however
unlike traditional sports, esports is fully owned and controlled by the publisher warranting
protection as analysed by the author. It is pertinent to resolve this ever-prevalent conflict by
reaching a ‘middle ground’ which benefits players without infringing the rights of publishers.
Lastly, from bedrooms to professional spaces, gaming has come a long way, therefore there
exists a pressing need to regulate the esports domain by widening the ambit of powers given
to associates or federations, along the lines of International Esports Federation, Korea for
ensuring fair play and adherence to regulations.