The role for trade marks in e-sports brand protection

A recent study undertaken by Market.us found that the global e-sports market is expected to grow from a total value estimated at just under $2 billion now to almost $11bn in 2032. This reflects the fact that the biggest e-sports are attracting an audience of millions of viewers, which in turn is attracting major sponsors, new talent, and new event organisers.

In an increasingly competitive market place, where events are heavily marketed on social media platforms, e-sports teams and organisers need to be able to stand out. Developing a strategy for protecting and commercialising brands – and registering trade marks to underpin that – should be a priority for those businesses.

A trade mark is a badge of origin which enables consumers to identify and distinguish brands in the market. Trade marks can take the form of logos and words, but also colours, slogans, sounds and even smells. Although trade marks can exist in both registered and unregistered form, registration offers the best protection as it gives the owner an exclusive right to prevent others from using the mark in relation to the goods or services covered by the trade mark registration in the country it is registered.

There are several ways registering trade marks might be beneficial:

• it provides an exclusive and monopoly right in a name or a logo, or other form of relevant mark for;
• it can be used to prevent competitors and/or third parties using or attempting to register identical or similar marks/signs for identical/similar goods and services;
• trade mark registration can act as a deterrent to others intending to adopt identical, close or similar marks;
• trade marks are assets which can be licensed or franchised, and therefore monetised;
• registration can boost value in negotiations with investors and potential purchasers – registrations are often important in any sale/investment negotiations as they provide comfort that the brand is protected;
• trade marks can help distinguish brands and in turn support efforts  to establish and/or expand market share.

In the e-sports context, trade marks have helped e-sports teams such as OG, Team Liquid, Fnatic and Evil Geniuses attract sponsorship from companies such as SecretLab, Alienware, HyperX, ASOS, Red Bull, Monster Energy and Honda. The trade marks provide the teams with control over their brand, which can provide comfort to would-be sponsors considering associating themselves with those brands. Sponsorship helps the teams cover the costs they incur in investing in their talent.

In a similar vein, attracting sponsorship is vital for e-sports organisers amidst an environment where prize pots are getting bigger, and tournaments are increasingly expensive to run and organise.

Having a registered trade mark can also help e-sports teams protect merchandise and in-game content from being subject to counterfeit products, opening up potential new revenue streams from the sponsorship of loot boxes or skins.

Besides participating in organised tournaments, players will often stream their gameplay on Twitch or similar platforms. E-sports teams or event organisers will be able to take enforcement action against people who attempt to impersonate a player on social media or via merchandising if the activity infringes registered trade marks.

In October 2019, Riot Games, the company behind League of Legends and Valorant, reportedly filed a claim in the US state of California against Riot Squad Esports LLC, an e-sports organisation, alleging that Riot Squad had tried to unfairly piggyback on its name and infer a connection, via branding on the team’s jerseys and by using similar slogans, between the two companies.

According to PCGamer.com, Riot Games sought an injunction against Riot Squad for trade mark infringement, seeking compensation, and recovery of legal costs, costs of covering “corrective advertising” and “all gains, profits and advantages derived from the unlawful acts”. Various sources suggest that the dispute was settled before reaching trial. Riot Squad has subsequently changed its name to Oath Gaming.

As the e-sports industry increases in profile, organisations operating within it need to appreciate the value they can derive from their brands – and the possible risks that come with an enhanced reputation that they fail to properly protect on a global scale.