On May 9th, Shanghai Intellectual Property Court made a judgment in the second instance on the appeal concerning the dispute over copyright infringement and unfair competition between the Appellant Guangzhou Douyu Network Technology Co., Ltd. (hereinafter referred to as “Douyu”) and the Appellee Shanghai Yaoyu Media Co., Ltd (hereinafter referred to as “Yaoyu”), rejected the appeal and affirmed the original judgment. Douyu was sentenced to compensate Yaoyu for economic loss of RMB one million and reasonable costs of right protection of RMB 100,000, and make an announcement at a notable place on the homepage of Douyu’s website so as to eliminate the harmful effect. It is learned that the case is the first case over copyright infringement and unfair competition in China arising from the webcast of e-sports event. DOTA2 is an e-sports online game popular in the world developed by the American company Valve Corporation. In 2014, Yaoyu signed a strategic cooperation agreement with Beijing Perfect World Network Technology Co., Ltd, the agent of DOTA2 (hereinafter referred to as “Perfect World”) to jointly hold the 2015 DOTA2 Asia Championship, and Yaoyu obtained the exclusive video broadcasting right of such event in Mainland China. Douyu, without authorization, made a live broadcast of such event by way of putting up the screenshots of the event accompanied by the comments of the host while following the event on the client side, and used the mark of Yaoyu during live broadcast. Therefore, Yaoyu instituted a suit to the court and requested a judgment to stop the infringement, eliminate the negative effects and compensate a total amount of RMB 8.211 million for economic loss and reasonable costs. The court in the first instance believed that the network users could watch the ongoing event involved within the specified time period only when Douyu made a live broadcast, and the infringed video broadcasting right claimed by Yaoyu was neither the right of communication through information networks nor other copyright provided by law; in addition, the pictures of the event were not the works as provided by the Copyright Law, therefore, Yaoyu’s claim on copyright infringement of Douyu could not be established. But the court in the first instance confirmed that Douyu constituted unfair competition, and made a judgment that Douyu assumed the liability to eliminate effects and compensate a total amount of RMB 1.1 million for economic loss and reasonable costs. Douyu refused to accept the judgment, and made an appeal to Shanghai Intellectual People’s Court. Douyu believed that at present, domestic games broadcasting websites mostly applied such method that the pictures of events were captured on the client side and then broadcasted to the game players with the comments and incidental music of its own platform, while the game makers never had any objection to that; the game client involved in this case didn’t have any notice stating that the broadcast screen capturing was prohibited; according to the civil principle that no action was guilty without explicit provision in the law, the behavior of Douyu was in essence the report of the event involved, and such behavior was not beyond the scope of reasonable use by the user of the game client. Moreover, the behavior of Douyu did not harm the economic benefits of Yaoyu, therefore, such behavior did not constitute unfair competition. Shanghai Intellectual Property Court considered in the second instance that Douyu neither made any investment to the organization and operation of the event involved and nor obtained the video broadcasting right, but enjoyed free of charge the commercial results generated from the event organized and operated by Yaoyu, which had invested lots of manpower, material resources and financial resources, for the purpose of seeking commercial benefits and competitive advantages. Such behavior was actually “free riding” which took away the audiences that originally belonged to Yaoyu, causing serious loss of Yaoyu’s website traffic, having affected the advertising revenue capacity of Yaoyu, damaged Yaoyu’s commercial opportunities and competitive advantages and weakened the potential to increase the value of Yaoyu’s online live platform. For these reasons, the behavior of Douyu breached the principle of honesty and credibility in the anti-unfair competition law, violated the recognized business ethics, damaged the legal interests and rights of Yaoyu and disrupted the market competition order, which obviously constituted unfair competition. Therefore, the appeal was rejected and the original judgment was upheld. [Case Study] Although game makers also encourage the video platform to broadcast the game competition, may the participants or bystanders of any game client side rebroadcast or make a live broadcast of, the game competition? Shanghai Intellectual Property Court held that even though the game makers encouraged video platforms to broadcast the game competition, which belonged to the situation of free licensing, but it did not indicate that the participants and bystanders of game client sides may be entitled to (without authorization) make a live broadcast, rebroadcast and use the pictures of competition in the clients for commercial purposes. The “DOTA2” involved in this case was a world-renowned e-sports online game, and there was an explicit statement on its Chinese official website that the event involved was an international professional event organized by the Perfect World, undertaken by MarsTV and exclusively broadcasted by Huomao TV. The appellant, as a professional game live website, should have known the broadcast of such large-scale and well-known event must be subject to authorization and license, but it made a live broadcast through capturing screens of the event from the game client side for seeking illegitimate benefits when it was fully aware that the appellee enjoyed the exclusive video broadcasting right of the event involved. Therefore its subjective malice of unfair competition is obvious. The judgment of this case plays a guidance and regulation role in the booming e-sports game industry.
