This case is one of the Top 10 IP Cases of the Year (2015) selected and summarised by the Supreme People's Court. This update provides an edited translation of the court's case summary and significance, as well as brief commentary as appropriate.
The Guangzhou IP Court recently ordered an injunction during an ongoing copyright infringement and unfair competition suit involving Blizzard Entertainment Inc, Shanghai NetEase Network Technology Development Co, Ltd and Chengdu Qiyou Technology Co, Ltd.
The computer game World of Warcraft (魔兽世界) is owned by Blizzard Entertainment Inc and operated in mainland China exclusively by Shanghai NetEase Network Technology Development Co Ltd.
Blizzard and Shanghai NetEase found that Chengdu Qiyou Technology Co Ltd had developed a computer game called Warcraft of the State (全民魔兽) – formerly known as Chief Sal (《酋长萨尔》) – which was operated exclusively by Beijing Fenbo Time Network Technology Co Ltd and available to download through Guangzhou Dongjing Computer Technology Co Ltd.
Blizzard and Shanghai NetEase brought claims of infringement against Warcraft of the State, arguing that Fenbo's unauthorised use of World of Warcraft's name and design, combined with false advertising, constituted unfair competition. The plaintiffs filed an application for an injunction, requesting that the court ban the operation and distribution of Warcraft of the State, and deposited a cash warranty of Rmb10 million.
The Guangzhou IP Court granted an injunction(1) to be enforced until the date on which the final judgment takes effect. For the duration of the injunction, the defendants would be able to respond to balance inquiries and refund requests from players of the game. Qiyou and Dongjing automatically complied with the injunction, while Fenbo was obliged to comply under the court's supervision and explanation. Qiyou and Fenbo later filed an application for reconsideration against the injunction, which was dismissed by the court.
Before granting the injunction, the court considered all of the substantial requirements provided by the procedure. To ensure that the injunction was reasonable, effective and discreetly granted, the court assessed the chance of an infringement ruling and whether irreparable damages would be caused to the plaintiffs. It considered the following factors:
- The launch of the defendants' game would reduce the market share of the plaintiffs' new game;
- The short lifespan, fast distribution and broad range of computer games would make it difficult to assess the plaintiffs' prejudice; and
- The marketing strategy used for the defendants' game would harm the plaintiffs' business reputation.
On these grounds, the court granted the injunction. However, taking into account the players' interests, the court permitted the defendants to continue to respond to balance inquiries and refund requests from players for the duration of the injunction.
In this case the court demonstrated a strong resolution to protect IP rights. Following support for the decision, the case was recognised in the "Exemplary IP Cases" released by the Supreme People's Court in September 2015.
For further information on this topic please contact Hui Huang, Paul Ranjard, Huimin Qin or Nan Jiang at Wan Hui Da Law Firm & Intellectual Property Agency by telephone (+86 10 6892 1000) or email ([email protected], [email protected], [email protected] or [email protected]). The Wan Hui Da Law Firm & Intellectual Property Agency website can be accessed at www.wanhuida.com.
(1) Blizzard Entertainment Inc v Chengdu Qiyou Technology Co Ltd (Guangzhou IP Court (2015) Yue Zhi Fa Zhu Min Chu Zi 2-1 civil judgment).