WIPOD – Arbitration and Mediation Matters: Transcript of Episode 7

WIPO ADR for Video Games and eSports Disputes

Selin Ozturk

Pop quiz. What's your favorite video game?

Leonid Shmatenko

Zelda.

Selin Ozturk

I love Zelda.

Alexia Gkoritsa

This is my medallion. It's hamming. No, it's a Witcher. It's the Witcher 3.

Selin Ozturk

Welcome gamers and enthusiasts to another episode of WIPOD Arbitration and Mediation Matters, the WIPO Arbitration and Mediation Center's podcast on intellectual property and innovation disputes. My name is Selin and thank you for listening as this episode aims to provide practitioners, a deeper understanding of the use alternative dispute resolution mechanisms. For example, mediation and arbitration for disputes related to video games and eSports. So, join us as we embark on a digital journey where virtual worlds come to life. Today, we're joined by Alexia Gkoritsa, a legal case manager here at the WIPO Arbitration and Mediation Center, and Leonid Shmatenko, who is part of the data protection and technology law team at Eversheds andSutherland. He has a vast experience in regulatory and general issues in the areasof eSports and Blockchain. He advises eSports associations and clubs on legal issues, advises, and supports crypto startups in all matters from planning, preparation to execution of private and public token offerings, so called, Initial Coin Offerings or ICOs. So, thank you both for joining us today. Let's dive right into this fascinating intersection of digital realms of video games, eSports, and dispute resolution.

Leonid Shmatenko

Thank you, Selin.

Alexia Gkoritsa

Thank you for having us.

Selin Ozturk

Our pleasure. And so to begin, Leonid I have a question for you right off the bat. Could you give us an overview of the evolution of the video gaming and eSports industry and how it has led to an increase in potential disputes?

Leonid Shmatenko

Thank you for the question, Selin. Sure. Actually, You have to distinguish between competitive gaming and eSports. Competitive gaming can't be parallel. It means you can be, speedrunning, but it's not simultaneous since you're not competing against real human beings at the same time. So this is still a gaming competition, but it's not an eSport. Esports is simultaneous, and it's something like rocket league or other games that you're playing, in a competitive way. So this is eSports from a legal point of view, and the eSportsindustry, particularly during the COVID times, has seen a great increase of audience but also of professionalization, and this professionalization led to all kinds of disputes beginning with IP (intellectual property) issues that you at WIPOresolve, over to doping - yes, eSport athletes can dope to be more concentrated, the wild playing, or to be less nervous. And to other potential disputes about, organization disqualification and labor disputes where also mediation comes into play.

Selin Ozturk

Thank you very much for the clarification as well. I wasn't aware that you could dope in eSports as well. So as a follow-up question for both Alexia and Leo, what kind of disputes can occur in the video games and eSports industry? What are the critical legal issues and the unique challenges the industry faces in addressing these disputes? So perhaps, Alexia, you can go first.

Alexia Gkoritsa

Thank you. And thank you for the great question, Selin. So I will pick up from where Leonid left it off, and I will speak naturally about IP disputes, since these are the ones that we mostly see here at the WIPO Arbitration and Mediation Center. So this can range from copyright infringement and IP licensing disagreements, to trademarks, patents, royalty disputes, and more. The interesting part is that the industry dances to the rhythm of rapid technological exchanges, if I may put it this way, which often in turn leads to complex cross border issues and cross border partnerships. And this unique landscape in turn demands tailored solutions. And this is where ADR comes into the picture.

Leonid Shmatenko

Yeah, if I may continue on that, Alexia. There are difficulties in the eSports industry to find one alternative dispute resolution (ADR) administrator or one venue, so to say. Having analyzed a lot of terms and conditions of eSports tournaments, the arbitration clauses are very many fold. It starts with the ICC and other institutions, but there is no consistency, and this is what is really missingin the eSports industry. Additionally, with that kind of dispute that we have discussed, IP, doping, and so on, there is another challenge in eSports and that is that most of the eSports athletes are between fourteen and thirty years old. Meaning that the ones who are below eighteen, in order to go to a dispute resolution center would need the consent of their parents or guardians, and this is another challenge that usually arbitration would have to, take into account, and I think where an alternative distribution center based for eSports disputes, would it have an advantage if the rules, additionally, provided for minors to be able to arbitrate and that arbitration consent would be given in advance by their parents/guardian.

Selin Ozturk

So to follow-up, ADR mechanisms such as mediation and arbitration as we know offer parties efficient alternatives to court litigation, as we can all agree, I believe. And so could you explain how these mechanisms can be effect actively utilized to resolve disputes, specifically in this sector. In particular, is often advertised as a very effective alternative approach to resolving disputes. So could you explain how mediation fits into the video games and eSports legal landscape?

Leonid Shmatenko

I recently wrote an article about mediation in the perceptor. It's in a book. You can you can Google it to mediation, and eSportsand my name, and it will show up on academia.edu. Sorry for the self-advertisement that I had to say it. Look, there are some, particularities in some disputes, like labor courts or labor disputes which are not arbitrable, for example, in Germany. So, that means that if you have a dispute between a eSports athlete and his club or "Clan", how you call it in the eSports industry, then you either go to the labour courts, or you can mediate. And most of the times, and that's what I have seen in mediation is that the court of the dispute is usually something that, refers to hurt feelings. And, if you can find a mediator who can resolve these hurt feelings, for example, a player who never has been told thank you even though he won a lot of championships, and he did wanna have a bonus or a pay raise just wanted to thank you, then you can resolve a lot of such labour disputes, and I think also other kinds of disputes.

Selin Ozturk

Thank you, Leonid. Alexia, do you have anything to add?

Alexia Gkoritsa

Just a a small recap to what Leo said. And, if I might draw a comparison between mediation and arbitration as well, since you initially asked about ADR in general. So, what we say is that both mediation and arbitrationare like personalized problem solvers for the industry. So mediation is more like a constructive sit down where parties collaborate to reach a solution. In my opinion, it is a great fit for the industry because it emphasizesfinding common ground and maintaining relationships. Now arbitration, it brings a different dynamic. It brings first of all, structure to the table. So when parties opt for arbitration, they are choosing a structured process where an impartial arbitrator that is someone with a keen understanding of the video games and eSports landscape. He/she assessesthe dispute and makes a binding decision. That is in very rough lines. Both options come with the advantage of having experts. That is having people who understand the industry and who can ensure to a great extent at least a smooth and efficient process.

Selin Ozturk

Thank you, Alexia, for that wonderful summary, and comparison. I do have a follow-up question for Leonid. Are there any specific advantages ADR offers over traditional litigation in the context of this industry that you have seen?

Leonid Shmatenko

Well, it's like with everything in ADR, I would say. Traditional courts litigation -they are very broad. They have, judges who can decide upon everything starting from, rental dispute between two tenants andthe landlords, going over a bad haircut of a dog, up to, multimillion claims of different industries. What ADR can offer in my opinion is that the video game industry can profit from is, specialized courts, specialized arbitral tribunals, where you have individuals sitting who are specialized in eSports disputes on video game disputes who have a clue that, you can't hardware cheat, and this is their daily bread, so to say, and they can quickly grasp what the dispute is about. So, the advantage would be that you have highly specialized professionals in ADR as compared to, all-in judges in litigation.

Selin Ozturk

Thank you very much. And so with both of your experiences, would you be able to provide some specific case examples. Perhaps Alexia, you could share some from the (WIPO) Center itself.

Alexia Gkoritsa

Sure thing. So, on our side here at the WIPO Arbitrationand Mediation Center, I already implied that we have, administered cases involving practically everything. From copyright disputes over the scenario of a game to unauthorized streaming and even sorting out what we could call classic contractual matters, especially those related to royalties. As examples: some of our most recent cases related to copyright infringement, payment of royalties, and blocking of unauthorized streaming of this board's competitions, copyright infringement over the scenario of a game, making available and actively advertising unauthorized copies of a game; Or even obtaining trademark licenses to use a logo inside a video game. And all in all, that is to say that these are real life examples that serve to show how ADR can step in, and how we can effectively address a very wide breath of issues.

Leonid Shmatenko

Yes, and if I may continue, I have seen more disputes on the player's side as an arbitrator where there was a case concerning the disqualification in a tournament. And so, there is a need to to arbitrate, those cases because sometimes it's better to have someone who has a clue and I recommend everyone who's in extra league interested in eSportssports and based in Switzerland to do the referee certification of the Swiss eSport Federation. Where you can even avoid arbitration in the first hand. And it's good that you have professionals who see that the disqualification was because of rule XYZ, because it's different in eSports than, let's say, in basketball or football. Traditional sports have different rules that, you cannot replicate completely in verbatim to to eSports. In these cases, you have to be really esports focused and and see what the problems of the individual are, and whyhe or shewas disqualified.

Selin Ozturk

Thank you both for providing those examples. And so, Alexia, I actually have a question for you regarding WIPO's Dispute Resolution Board (DRB). Could you elaborate on this DRB procedure, how it works, the key features? Because I think our audience would, be interested on how, you know, DRB interacts with other ADR methods like arbitration.

Alexia Gkoritsa

Happy to explain Selin. So, the DRB procedure is like having a team of industry experts on standby. They are there to handle ongoing collaborations, and they are there to do it swiftly. So you may think of it as a team of industryexperts who are ready to intervene to mediate and provide recommendations for resolution. And if those recommendations do not work, parties can easily pivot to arbitration. In essence, the DRB procedure starts with what they would call expert mediation before and through the DRB. And if needed, it can progress to more formal arbitration, which will be as well tailored to the needs of the parties involved. So, it is like having multiple tools in the ADR toolbox and each of these tools serves its own purpose.

Selin Ozturk

Thank you very much Alexia for going into such detail for us. And one more question. Collaboration and cooperation with stakeholders seem crucial in maintaining effective ADR procedures, especially for this Sector. How does WIPO Center work with concerned stakeholders and entities within the video games and eSports industry to develop tailored ADR solutions?

Alexia Gkoritsa

Well, our efforts in this area are all about dynamic partnerships. So, we actively engage with key stakeholders, and that can be players, association, and experts. These stakeholders and individuals will usually possess a deep understanding of the intricacies within the gaming domain. So, we take their insights. We combine them with our expertise, and we craft ADR solutions, which are tailored to the challenges of the industry. One way we havebeen doing that more recently is through an initiative called "Orientation Sessions". So in that case, people who are already facing the dispute related IP, to innovation, to technology, etcetera, etcetera, book a free appointment with us, basically, with people from the WIPO Arbitration and Mediation Center for assistance. This is like a one-on-one conversation if I may put it with a team of experts. It is a way to help stakeholders start the best course towards resolution. That is mostly after the dispute has arisen. So proactively preventing disputes is also key. From our side, proactive steps involve, basically, and first and foremost raising awareness. As an example, the Organization (WIPO) has recently launched the the project called a video game development, the quest for IP. This project basically makes available to stakeholders and anabundance of materials and resources such as podcast interviews, like the one we we're having now, expert advice and more, and they are all aimed that helping video game developers navigate the complete landscape of IP. I could even go as far as characterizing this project as a "guiding light", if I may put it this way, to developers to overcome IP challenges and succeed even before and irrespective of a dispute that may arise.

Selin Ozturk

So to wrap up my final question: could you both summarize the key advantages that ADR brings to the video game and eSports industry? And why it's becoming a preferred choice for resolving disputes.

Leonid Shmatenko

Thank you, Selin, for that question. I think we have also a little bit to distinguish here, like ADR in general, in my view, the better suited venue for eSports disputes because offers you highly specialized individuals who can resolve your disputes in eSports from Ato Z. That said, we're still missing rules in eSports of ADR that will, give it a kick start, so to say. It's going well, but if we are quick andwe have quick solutions on how to quickly resolve ADR dispute, that would bring an additional advantage to ADR as compared to, litigation and courts in in every jurisdiction, because then tournaments could take place with one rule to rule them all. Let’s quote, Lord of The Rings here, and then everyone would know, like, what they're can hold upon and how their disputes will be resolved.

Alexia Gkoritsa

So just to continue from where Leonid left it off. As far as WIPO ADR is concerned at least and with the idea I'm most confident to speak about for me, it's mostly like this. It brings to the table of the experts, the speed, and the confidentiality that the sector needs. We usually characterize the gaming industry as an industry that is always one step away from the next big thing, if I may put it this way. So ADR in general at in my view, is atool that can ensure the sector's growth remains unhindered. And as far as WIPO ADR is concerned for me, thebest part is that it is accessible to all. And this is what is demonstrated, by the cases, we have handled here at the Center. So, from SMEs to multi-national corporations, and whether it's patents, copyright, softwares, any IP issue, we can step in with procedural advice, guidance, and rules for the parties.

Selin Ozturk

Thank you both. So much for summarizing these key advantages. I guess it's "game over" for this episode. The WIPO Arbitration and Mediation Matters podcast. Thank you both so much for joining us today and providing our audience with a mini sheet code, one might say, on the video games and eSports industry, especially through the lens of alternative dispute resolution. So, stay tuned for our next episode as we continue to explore the ever evolving landscape of alternative dispute resolution and its impact on the vibrant world of innovation and intellectual property. Thank you both.