China: How to Protect Your Online Games in China*

Last Updated: 28 March 2017
Article by Tracey Tang and Vincent Wang
Most Read Contributor in China, October 2017

* This article is co-authored by Tracey Tang and Vincent Wang. Vincent is a Partner at Davis Wright Tremaine LLP.

Online gaming in China represents one of the largest and fastest growing internet business sectors in the world. In 2016, the online gaming industry in China saw an unprecedented total market value of RMB 165 billion (or approximately $24 billion USD). Unfortunately, many in the global online gaming world suggest that revenue from game infringement contributed to this figure. With the largest consumer base in the world, China presents a huge opportunity for online game developers, but the risk of infringement of successful games, brands, and images has become a continuing headache for right holders. So, what actions can be taken to ensure statutory protection of online games in China?

Similar to the U.S., Japan, and other western countries, China does not enact laws or regulations specially designed for statutory protection of online games. Online games are protected by specific intellectual property laws, anti-unfair competition laws, and criminal laws when their elements and aspects are determined as qualified subjects of legal protection under those laws. Copyright holders of online games may be able to seek protection and remedy based on trademark, copyright or patent infringement, unfair competition, or criminal offense (respectively or on a combined basis), depending on the particular circumstances of the infringement.

This article is the first in a series introducing the available protection options and proper strategies to fight against online game infringement. This article will provide an overview of the various protection alternatives based on applicable laws and recent court rulings in China.

Copyright

Essentially, online games are software and game content running on a network platform. Given that both the source code and the expressive elements, such as the characters, art works, literary works and music of a game are entitled to copyright protection, copyright law is the most frequently used option to protect intellectual property from being stolen, replicated, or used without permission. According to 2016 statistics released by Beijing Haidian District Court and Beijing Shijingshan District Court1, around 85 to 90 percent of online gaming infringement cases are based on copyright infringement.

As infringement culprits become more and more sophisticated, pursuing civil claims on copying game source code is less commonly asserted by the plaintiffs. In practice, if a plaintiff claims that person A has copied its game source code, normally the plaintiff would expect an expert witness, mutually agreed on by both parties in the dispute or designated by the court, to make a comprehensive and detailed line-by-line comparison of the source code of the copyrighted game and the game allegedly committing copyright infringement. This method has a prolonged time period for trial and a costly professional fee, initially born by the plaintiff, making the civil claims less efficient and effective compared to the potential reward from the final judgment on the source code infringement dispute. Because (1) private servers or illegal plug-ins usually involve hacking or unauthorized modification of game source code, (2) the operators of private servers and illegal plug-ins, usually make substantial illegal gain, as an alternative to the civil claims, copyright holders in most cases could also choose criminal charges against the illegal operators. As a result, solely filing civil lawsuits on source code infringement has become less popular. In contrast, copying characters, storylines, plots, scenes, settings, literary works, art works and music in a well-known prior work (including, but not limited to, online games, novels, TV plays, movies, animations, comic books, etc.) is more commonly seen in online games offered to Chinese fans. Some Chinese developers would rather take the chance for a free ride on the popularity of an existing game by emulating the look and feel or the features of the prior work than create innovative expressions of their own or seek authorization from the original copyright holders for the use of these copyrighted works in their own games. In accordance with the PRC Copyright Law, as well as our research of recent court cases relating to copyright infringement disputes regarding online games, the game elements listed below may be categorized into the following statutory types of copyrightable works and may be granted copyright protection by China courts if they are the original works of authorship, met with the proper level of creativity.

Generally speaking, if a plaintiff can demonstrate the substantial similarities between the above-mentioned elements in an allegedly infringing game and those in a copyrighted game based on side-by-side comparison, a copyright infringement claim can be successfully established. It seems pretty simple to classify various elements of an online game into the categories listed in the chart above and decide whether copyright infringement can be constituted. However, this practice has never been straightforward, especially when the defendant may argue certain components are not copyrightable or protectable even though similarities exist. You will get a sense about this complexity from the following brief summary of a few recent and influential online game infringement cases where China courts upheld or denied copyright protection over certain game elements:

"My Name Is MT" vs. "Super MT"

In this lawsuit, the mobile game "Super MT" was alleged to have copied the mobile game "My Name Is MT". The Beijing IP Court found the names of the plaintiff's game and its characters are not copyrightable for lack of creativity and personalized expression. Further, because the plaintiff's game was originated and adapted from a comic book, the court decided that, as far as the character images are concerned, only new elements created by the plaintiff that are different and separate from the pre-existing expressions in the comic book are protectable.

"MU Online" vs. "Miracle Legend

In this lawsuit, the web game "Miracle Legend" was accused of cloning the game "MU Online." The Shanghai Pudong New Area Court held that the combination of names and introductions of game characters (including non-player characters), maps, characters' skills, weapons and equipment can be deemed as part of the storyline of the game, and therefore are protectable literary works, even though such names or introductions, if standing alone, may not meet the level of creativity.

In addition, this court judgment for the first time in China's judicial practice recognizes that consecutive game pictures are copyrightable as works analogous to cinematography because the visual expressions of the plaintiff's game are very similar to those of cinematographic works, despite the fact that users may interface differently with the game pictures within the developer's pre-established game designs and settings.

Given the substantial similarity of the overall look and feel of the two games, the court concluded that the defendant infringed upon the plaintiff's copyright by cloning the maps, scenes, game level designs, characters and their skills, weapons, equipment and more of the plaintiff's game. The court rejected the defendant's defense that the plaintiff's three-dimension client game cannot be similar to the defendant's two-dimension web game.

"Hearthstone: Heroes of Warcraft" vs. "Crouching Dragon Legends"

In this lawsuit, You Ease's "Crouching Dragon Legends" was alleged to infringe Blizzard's "Hearthstone: Heroes of Warcraft." The Shanghai No.1 Intermediate Court held that game rules and gameplay, as well as the layout of game interface, are in fact ideas rather than expressions of ideas and thus, are not protectable under PRC Copyright Law.

In addition, when commenting whether the defendant copied the plaintiff's game instructions, the court held that the allegation was not supportable due to the limited number of expressions of same gameplay or game rules, which, in essence, applies the theory that prevents a monopoly over "an idea where there are only a limited number of ways of expressing the idea."2

It is worth noting that, although Blizzard lost the two copyright claims on game rules and instructions in the above lawsuit, it eventually won this lawsuit based upon its successful claim under the anti-unfair competition law, as discussed later in this article.

As such, the judicial determination of copyright infringement in the online gaming environment is not very different from that in other creative industries. Under normal circumstances, the China courts would affirm copyright infringement and support the plaintiff's case if (i) the expressive elements in plaintiff's game copied or used by the defendant fall within the statutorily defined subjects that are entitled to copyright protection under the PRC Copyright Law; (ii) there exist substantial similarities between the two games' expressive elements; and (iii) no substantive copyright defense, such as the merger doctrine or fair use, is applicable to the specific situation.

Trademark

Generally speaking, only a very small portion of game elements, such as game name, icon, and images of key characters are registerable as trademarks under Chinese law. Therefore, only unauthorized use of the plaintiff's registered trademarks that confuse the public will be recognized as trademark infringement by China courts. Given the long process for trademark registration in China and the short life span of most online games, trademark protection may not be a viable option for many online games. However, because trademark protection is comparatively straightforward and efficient in law enforcement, it is still very important for game developers to register their game-related trademarks in China in order to build their own proprietary brands and fight against copycats and free-riders.

Patent

Patent might be the most overlooked option for protecting innovation in online games. Only as recently as two to three years ago did international and Chinese game developers begin building up their patent portfolios in China. Today, more than 35,000 patent applications relating to online games have been filed in China. Most are for game balancing mechanics, user control methods, anti-cheating systems game user interfaces, and game-related hardware, such as a console. However, patent infringement claims relating to online gaming are still rare in China. Given the lengthy period of the patent application process and the general vulnerability of a patent title ownership, there may not be a significant amount of forthcoming patent disputes in the online gaming industry in the near future. It should be expected that game developers will put forth a greater effort to develop their patent portfolio and make full use of the "defensive" value of patents.

Anti-Unfair Competition

In China, the Anti-Unfair Competition Law typically serves as a useful supplement or substitute where the specific intellectual property law is neither applicable nor sufficiently effective in a particular intellectual property infringement dispute. More and more plaintiffs in online game infringement lawsuits are seeking remedies under both the relevant intellectual property laws and the Anti-Unfair Competition Law where applicable. The China courts often rule that the defendants are responsible for their unfair competition activities or in violation of good faith principle if the game elements being copied are not protected or cannot be sufficiently protected under the relevant intellectual property laws. Anti-Unfair Competition Law is particularly useful where the defendant is found to make false or misleading publicity about its game or tries to take a free ride on the fame of plaintiff's games, brands, and images, or confuse the public. The following are examples of recent court cases where anti-unfair competition protection has been granted.

"Hearthstone: Heroes of Warcraft" vs. "Crouching Dragon Legends"

As stated above, the Shanghai No.1 Intermediate Court denied copyright protection for gameplay and game rules in the plaintiff's game because those elements are ideas rather than expressions. Nevertheless the decision made it clear that the plaintiff's game is an intellectual and creative product with considerable commercial value, and the gameplay and game rules created and designed by the plaintiff should be protected under the PRC Anti-Unfair Competition Law. Therefore, the defendant was held liable under Anti-Unfair Competition Law for its unreasonable and unfair copying and imitation of the plaintiff's game.

"World of Warcraft" vs."Everyone Warcraft"

In this lawsuit, Chengdu Qiyou's "Everyone Warcraft" was claimed to infringe Blizzard's "World of Warcraft." The Guangzhou IP Court first concluded that Blizzard's World of Warcraft series was a well-known online gaming service, then decided that the game name, in addition to certain user interfaces, were uniquely associated with the plaintiff's online game series and, thus, formed a unique name and trade dress of a well-known service, which should be protected. As a result, the defendant's unauthorized use of the plaintiff game's unique name and decoration in its "Everyone Warcraft" game had caused public confusion and was in violation of PRC Anti-Unfair Competition Law.

HuoMao TV vs. Douyu TV for live streaming of Dota 2 Asia Championships

In this lawsuit, Douyu TV was claimed to have infringed the exclusive live streaming rights of Yaoyu (the operator of HuaMao TV) for the Dota2 Asia Championship by providing a live stream of the same. The Shanghai Pudong New Area Court determined that the defendant's unauthorized broadcasting and live streaming of the Dota 2 tournament directly damaged the plaintiff's competitive advantage obtained from its exclusive broadcasting right of the same tournament authorized by the game operator and, therefore, violated good faith principles and generally accepted commercial ethics. The court found that the defendant should be liable for its unauthorized live streaming of the Dota 2 Asian Championships, although it did not infringe the plaintiff's copyright.

With online game infringement growing more and more complex and sophisticated, sometimes specific intellectual property law may be inapplicable or insufficient to enforce the rights of a copyright holder. As a result, the Anti-Unfair Competition Law is becoming more and more important as a tool for game developers to attack clones, especially when the visual similarity of the two games is not obvious, but the core value of the game owner's innovation, such as game play or game rules, is unfairly used. The good faith principle, as a catch-all provision under the PRC Anti-Unfair Competition Law, offers a more flexible legal basis to protect the game owner's competitive advantage, originated from the novelty and creativity in its online game. Therefore, in fighting against copycats in online games in China, plaintiffs should evaluate the facts carefully and craft sensible strategies that will balance claims under both the intellectual property laws and the anti-unfair competition law.

* This article is co-authored by Tracey Tang and Vincent Wang. Vincent is a Partner at Davis Wright Tremaine LLP.

Footnotes

1. These two courts are the top two courts in Beijing in terms of the number of the first instance trials of online game disputes.

2. Timothy B. McCormack, COPYRIGHT PRIMER: Merger Doctrine, MCCORMACK INT'L PROP. & BUS. L. (Dec. 28, 2010), http://www.mccormacklegal.com/blog/copyright-law-Seattle/copyright-primer-merger-doctrine

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.

Disclaimer

Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.

Registration

Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.

Cookies

A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.

Links

This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.

Mail-A-Friend

If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.

Emails

From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .

Security

This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.