China

Blizzard Entertainment Inc. and Shanghai EaseNet Network Technology Development Co., Ltd. V. Chengdu Qiyou Technology Co., Ltd. ET AL. (2015) YZFZMCZ No. 2-1 & (2015) YZFSMCZ No. 2-1, Guangzhou Intellectual Property Court

Cause of action: Dispute over copyright infringement and unfair competition

Collegial panel members: Gong Qitian | Zhuang Yi | Peng Ang

Keywords: interim injunction, irreparable harm, online gaming

Relevant legal provisions: Civil Procedure Law of the People’s Republic of China (as amended in 2012), article 100 Copyright Law of the People’s Republic of China, article 50

Basic facts: Blizzard Entertainment Inc. (hereinafter “Blizzard Entertainment”) and Shanghai EaseNet Network Technology Development Co., Ltd. (hereinafter “EaseNet”) filed a request for an interim injunction alleging copyright infringement and unfair competition against Chengdu Qiyou Technology Co., Ltd. (hereinafter “Qiyou”), Beijing Fenbo Times Internet Technology Co., Ltd. (hereinafter “Fenbo Times”) and Guangzhou Dongjing Computer Technology Co., Ltd. (hereinafter “Dongjing”). Blizzard Entertainment holds the copyright in computer software works such as World of Warcraft (first launched in the United States of America on November 23, 2004), World of Warcraft: The Burning Crusade (first launched in the United States on January 16, 2007), World of Warcraft: Wrath of the Lich King (first launched in the United States on November 13, 2008) and World of Warcraft: Mists of Pandaria (first launched in the United States on September 25, 2012).

The World of Warcraft series of games has won many important honors in China, such as being named among the “Top 10 Most Popular Online Games” in 2006 and 2007 at the China Game Industry Annual Conference, among the “Top 10 Most Popular Online Games” at the first Chinese Game Gold Raccoon Award in 2011 and “Online Game of the Year” at the Roster of Chinese Game Heroes in 2012.

From June 2014, Blizzard Entertainment started promoting its game World of Warcraft: Warlords of Draenor through its official Chinese website. On November 20, 2014, the game was officially launched in China and EaseNet operated it exclusively.

The hero characters in the World of Warcraft series of games include Velen, Illidan Stormrage, Garrosh Hellscream and Thrall, among others. The monster characters include Aku’mai and Deviate Shambler, among others. The designs of these heroes and monsters appeared on Blizzard Entertainment’s official Chinese website, in the English publication Ultimate Visual Guide of World of Warcraft, and in Chinese publications Art of Blizzard and World of Warcraft Thrall: Twilight of Dragon. These websites and publications all indicated that Blizzard Entertainment was the copyright owner. In these two cases, Blizzard Entertainment also claimed that it had copyright for fine-art works of 18 heroes and 7 monsters appearing in the games, as well as that “Warcraft” and “Draenor” constituted the specific names of wellknown products, “Thrall” constituted a famous character name and four game scenes (including the title interface, login interface and role-creation interface) constituted the special decoration of well-known commodities.

The disputed game, originally named Tribal Chief Thrall: Crusade of Warcraft, was developed by the respondent Qiyou. Fenbo Times held shares in Qiyou and was also the exclusive operator of the disputed game. On August 25 and September 19, 2014, respectively, Fenbo Times launched the open beta iOS and Android versions of the disputed game on its official website (www.rekoo.com); on December 19, 2014, it renamed the game Everyone Warcraft: War of Draenor. Dongjing, with the authorization of Fenbo Times, provided the Android version of the game to the public for download via its official website (www.9game.cn).

 Upon comparison, the court found the designs of the relevant heroes and monsters in the disputed game to be substantially similar to those designs in which Blizzard Entertainment claimed copyright.

 With respect to the publicity and launch of the disputed game, Fenbo Times’ official website contained the following statements:

“In order to recreate the World of Warcraft more perfectly, Tribal Chief Thrall … whether it is the players controlling the heroes or the monsters in the game instance, and whether it is the map design or special skills, the designs of World of Warcraft are almost 100% recreated … Panda Lin, top player of Warcraft, will accept the final challenge of ‘beauty calls at your home’.” “Everyone Warcraft is a PRG card game with the background of World of Warcraft. As a piggy-backing product, it presents many contents of World of Warcraft perfectly and instantly ignites the passion of the fans with its plots, heroes and scenes.”

In Fenbo Times’ official blog, some players commented: “I love the challenge of Warcraft so much … Let’s play World of Warcraft together.”

Blizzard Entertainment alleged that the disputed game copied the designs of heroes and monsters from its own game, and used names and decoration similar to those used in Blizzard’s own game. Indeed, Fenbo Times repeatedly claimed in its publicity that the disputed game was the mobile version of Warcraft. These acts of Qiyou, Fenbo Times and Dongjing jointly infringed Blizzard Entertainment’s copyright and constituted unfair competition. If allowed to continue, such infringement would cause irreparable harm to Blizzard Entertainment; hence, Blizzard instituted proceedings at the Guangzhou Intellectual Property Court and applied for an interim injunction, requesting that the disputed game be removed in its entirety. Blizzard Entertainment was willing to post a cash bond of RMB10 million.

 Qiyou, Fenbo Times and Dongjing contended that:

(a) the disputed game software was registered under the name of a third party;

 (b) Blizzard Entertainment could not prove that it was the owner of copyright in the designs of the heroes and monsters involved in the case, that the actions of Qiyou, Fenbo Times and Dongjing constituted copyright infringement and unfair competition or that it had suffered irreparable harm; and

(c) the issuing of an injunction would seriously harm their interests and the interests of those playing the game.

Qiyou, Fenbo Times and Dongjing therefore requested that Blizzard Entertainment’s application for an injunction be denied.

Held: The Guangzhou Intellectual Property Court issued an interim injunction on March 9, 2015, in which it:

(a) prohibited Qiyou from reproducing, distributing and disseminating through information networks the game Everyone Warcraft: War of Draenor (originally named Tribal Chief Thrall: Crusade of Warcraft) for a term expiring upon the effective date of the judgments of the present two cases;

 (b) prohibited Fenbo Times from reproducing, distributing and disseminating through information networks the game Everyone Warcraft: War of Draenor (originally named Tribal Chief Thrall: Crusade of Warcraft), and from engaging in the alleged unfair competition for a term expiring upon the effective date of the judgments of the present two cases, but on condition that the provision of balance inquiry, refund and other services for the game players during the term of the injunction shall not be affected;

(c) prohibited Dongjing from disseminating the game Everyone Warcraft: War of Draenor (originally named Tribal Chief Thrall: Crusade of Warcraft) through its official website (www.9game.cn) for a term expiring upon the effective date of the judgments of the present two case, but on condition that the provision of balance inquiry, refund and other services for the game players during the term of the injunction shall not be affected; and

(d) dismissed Blizzard Entertainment’s and EaseNet’s other injunction applications.

 Reasoning: Guangzhou Intellectual Property Court held as follows.

I. Requirements for substantive review in applications for an injunction

According to article 100 of the Civil Procedure Law of the People’s Republic of China, while one party’s actions may make a judgment hard to enforce or cause the parties additional harm, the courts may nonetheless, at the request of the other party, prohibit the first party from committing certain acts. Thus, while determining whether to issue an injunction, the court shall first review the likelihood that the applicant for the injunction will win the case. According to article 101 of the Civil Procedure Law, a right holder may apply for a preliminary injunction in case of urgency in which the failure to immediately issue an injunction would cause irreparable harm to the right holder. In this case, because Blizzard Entertainment applied for the injunction while instituting proceedings and claimed that the situation was urgent, it was also necessary to review whether the alleged infringement, if it were to occur, would cause the plaintiff irreparable harm.

II. Likelihood that the applicant will win the case

Both China and the United States are contracting parties to the Berne Convention for the Protection of Literary and Artistic Works, and Blizzard Entertainment’s works are protected by China’s copyright law under both the Convention and article 2 of the Copyright Law of the People’s Republic of China. Blizzard Entertainment is the owner of copyright in the computer software works of the World of Warcraft series games. In view of this, and the copyright marks that appear on Blizzard Entertainment’s official website and in its legal publications in relation to the introduction of heroes and monsters in the World of Warcraft series, there is sufficient proof that Blizzard Entertainment enjoys copyright in the artistic works of the designs of 18 heroes and 7 monsters claimed. The respondents’ unauthorized use of the designs of these heroes and monsters in the game infringed Blizzard Entertainment’s rights to reproduce, distribute and disseminate its fine-art works through information networks. At the same time, Blizzard Entertainment’s World of Warcraft series of games are widely known in the Chinese marketplace. Its World of Warcraft: Warlords of Draenor therefore constituted a well-known game. Since the relevant public views “Warcraft” as an abbreviation of the World of Warcraft and “Draenor” is the name of a fictitious zone in the World of Warcraft with distinctive features that distinguish the source of the commodities, World of Warcraft: Warlords of Draenor constitutes a specific name of a well -known game. Qiyou, Fenbo Times and Dongjing launched a similarly named game, Everyone Warcraft: War of Draenor (originally named Tribal Chief Thrall: Crusade of Warcraft), around the time that Blizzard Entertainment launched its World of Warcraft: Warlords of Draenor. Subjectively, it is clear that, in doing so, the respondents intended to free-ride on the popularity of the claimant’s game. Objectively, the similarly named game was likely to cause confusion among the relevant public. It thereby constituted unfair competition and the unauthorized use of specific names of the well-known commodities of others. In addition, Fenbo Times repeatedly mentioned World of Warcraft when promoting the disputed game. This was false publicity that was likely to cause the relevant public to believe the game to be a mobile version developed or authorized by Blizzard Entertainment. Qiyou was the developer of the disputed game, Fenbo Times was its exclusive operator and a shareholder in Qiyou, and Dongjing provided the download services through which the disputed game was delivered to the public, as authorized by Fenbo Times; hence, there was sufficient evidence to establish Blizzard Entertainment’s claim that Qiyou, Fenbo Times and Dongjing were jointly liable for the infringement. With Blizzard Entertainment being likely to win the case, it was obviously unconvincing for Qiyou, Fenbo Times and Dongjing to claim that the interim injunction would cause great harm to themselves and to their players if Blizzard were to lose. In addition, since the three jointly engaged in the infringement, whether or not the disputed game software was registered under the name of a third party did not affect whether the injunction should be issued in this case.

 III. Whether the plaintiff would suffer from irreparable harm

 The disputed game was launched around the same time as Blizzard Entertainment launched its game World of Warcraft: Warlords of Draenor. Although the two are mobile and PC games, respectively, both are online games that have similar names, which feature similarly designed and named heroes and monsters, have similar game interfaces and are similarly centered on heroes fighting monsters. The two are therefore products with a strong competitive relationship. The launch of the disputed game inevitably squeezed the market share of Blizzard Entertainment’s newly launched game. Furthermore, online games are characterized by a short life cycle, fast-paced dissemination and broad circulation, making the quantum of Blizzard’s damages hard to calculate. Moreover, Fenbo Times took a vulgar approach to marketing the disputed game. Confusing the disputed game for Blizzard’s game, the relevant public may share negative reviews, which will harm Blizzard’s goodwill.

 IV. Removal of the disputed game in its entirety and the protection of players’ interests Although Qiyou, Fenbo Times and Dongjing proposed that they might modify the designs of relevant heroes and monsters, the modifications that they proposed after the hearing remained substantially similar to the content claimed by Blizzard Entertainment. In addition, according to the facts that the name, designs of relevant heroes and monsters, and other important components of the disputed game are all infringing, and that the disputed game is promoted as “100% recreating” the designs of World of Warcraft, the designs of the remaining heroes or monsters of that game are likely to be found to be infringing, too. The facts underpinning Blizzard’s request that the respondents be required to remove the disputed game in its entirety are consequently sufficiently proven and the request shall be supported. However, the provision of services such as balance inquiry and refunds to players of the disputed game shall not be affected during the term of the injunction.