Playing The Game
With the eSports industry expected to hit a value of $1.5 billion this year, companies are scrambling to register trademarks to protect their brands. The recent INTA Europe Conference 2020 in Madrid was focused on the convergence of the sports and eSports industries. However, with billion dollar values at stake it is not the traditional run around a field or court type, rather, it is the eSports industry that is getting most of the attention these days. According to Forbes, the eSports industry already has a bigger audience than that of Major League Baseball.
Professional gamers are no longer the stereotypical geek, locking themselves in a room for hours on end. They are the new superheroes. Top players now compete for massive prize pools (Epic Games, the developer of Fortnite announced in May 2019 that it would be doling out $100 million in cash prizes). The biggest eSports events play to sell-out arenas, and top athletes like Kyle “Bugha” Giersdorf are well on the way to becoming household names.
eSports trademark activity on the up
There are over 4 thousand trademarks worldwide listing ‘eSports’ as a product and 90% of these trademarks are either valid or pending at the time of writing. The top regions for eSports trademark registration include the US, UK, EU and China.
Marks have been filed predominantly in classes 9 (electrical and scientific devices), 25 (clothing), 35 (advertising and business), 38 (communication) and 41 (education and entertainment), with Nice class 41 leading the field with a ratio of 19%.
eSports often take the form of organized, multiplayer video game competitions. Pro games typically take place between professional players who either play individually or as teams. Players can also be scouted for teams through streaming services such as Twitch or Mixer. According to Ranker the world’s most popular and valuable teams in 2020 include Cloud9, Team Liquid, FaZe Clan and Evil Geniuses.
Many high-valued teams are still to fully comprehend the protections given by trademarks. However IP savvy players are now investing heavily in their brand strength and brand protection, like the four teams we list above.
An analysis of these four teams and their trademarks, using our clearance search tool, ExaMatch, shows that, in spite of top eSports teams coming from all over the world, the US is currently the most utilized jurisdiction by them all, when running a comparative study within our platform’s database of 180 registries. The four team’s trademark portfolios are relatively new and small, but are all showing a trend of year upon year volume increase.
- Owner Faze Clan, Inc registered its first mark in 2008 and today has over 15 registered trademarks.
- The top 3 registries are the United States USPTO (66.7%), Australia IPAU (16.7%) and WIPO Madrid (11.1%)
- Top products are in class 25 (clothing) with a ratio of 21,7%, followed by class 35 (advertising and business) and class 41 (education and entertainment) with both having an equal product share of 17.4%.
- Owner The Evil Geniuses (EG), L.L.C registered its first mark in 2012 and has just 2 trademarks registered as of today. Both marks are found in the United States USPTO.
- The top product is found in class 35 (advertising and promotional services).
- Trademark owner Cloud9 eSports, Inc registered its first mark in 2014 and now has over 80 trademarks currently registered.
- Top registries are the United States USPTO (28.2%), Mexico IMPO (23.1%) and China CNIPA (21.8%).
- Top products are found in class 35 (advertising and business), 28 (toys and sporting goods) and 24 (fabrics) all with a ratio of 11.4%, closely followed by class 9 (electrical and scientific devices) and 14 (jewelry) with ratios of 10.7%.
- The owner Team Liquid Enterprises, L.L.C had its first mark registered in 2016 and now has just over 15 trademarks registered at the time of writing.
- All trademarks are registered with the United States USPTO.
- Top products are found in class 41 (education and entertainment) and class 38 (communication) both with a ratio of 20%, followed by class 9 (electrical and scientific devices), 25 (clothing) and 42 (research and development), all sharing a ratio of 15%.
Taking eSports battles offline
There has been a clear increase in trademark applicants using the term ‘eSports’ in their product descriptions since 2015, when the volume of trademark applications was just over 700. This has risen by a whopping 689% over 4 years, to more than 2 thousand by 2019.
However this phenomenal increase in the volume of trademarks brings with it a jump in eSport trademark disputes. Below are two of the latest cases currently going through the US courts.
Dispute over ‘riot’
Riot Games, which has trademarked “Riot” and “Riot Games” when used in connection with video games and eSports has launched legal proceedings against eSports company Riot Squad for trademark infringement. The former is accusing the latter of using the term ‘riot’ to achieve growth.
Riot Games is known for the game League of Legends. Riot Squad was founded in March 2019 and is based in Chicago. Riot Games alleges that Riot Squad administration “hopes and intends that by its use of the Riot brand name, consumers will mistakenly believe that its eSports organization is in some manner associated with, sponsored or endorsed by, or otherwise affiliated with Riot and its hugely popular products and services.”
Riot Games has asked a California court to prohibit Riot Squad from using the term ‘riot’ and pay damages. It also wants Riot Squad to hand over any merchandise which uses the mark ‘riot’ so it can be destroyed.
Given the current backlog being experienced by the Californian court system, it is unlikely that the trial (should the matter get that far) will be heard until the summer.
FAZE v FaZe
In May 2018, U.S. District Court judge R. Gary Klausner granted a preliminary injunction in favor of FAZE Apparel, preventing eSports organisation, FaZe Clan from using the trademarked word ‘faze’ on its clothing.
FAZE Apparel was granted the trademark ‘faze’ for apparel by the USPTO in 2014. It is seeking damages of up to $2 million per counterfeit mark.
FaZe Clan filed a counter-complaint in mid-April 2018 denying all allegations seeking attorney fees and other costs.
In May 2013, FaZe Clan also registered their own trademarks for “FaZe” and “FaZe Clan Sniping With Style” for use on clothing and merchandise; however, the USPTO refused the marks. This was because the marks were considered too similar to those already registered by FAZE apparel.
In 2015, FaZe Clan tried again to register “FaZe Clan” for use in videos, games, and clothing. Although they had to fight to get the clothing mark recognized, the USPTO ultimately approved the application later that year.
FAZE Apparel opposed the trademarks. FaZe Clan never responded. As a result, the Trademark Trial and Appeal Board ruled FAZE Apparel’s favor. FaZe tried to negotiate a licensing deal with FAZE, but talks broke down.
FAZE Apparel’s lawyers at San Francisco-based firm Braunhagey & Borden alleged in the 2018 suit.
“In the last several weeks alone, multiple customers have contacted FAZE Apparel to complain about FaZe Clan’s merchandise or customer service. For instance, earlier [in January], a consumer called the FAZE Apparel store to complain about FaZe Clan’s failure to promptly ship a sweatshirt that she ordered. Another customer contacted FAZE Apparel [in December] to ask why his FaZe Clan discount code wasn’t working”.
The case is currently still pending.
The statement from Braunhagey & Borden illustrates precisely why trademarks are so important – they protect consumers from brand confusion. With eSports set to tip over into a billion-dollar industry this year, future stakes in eSports trademarks are high.
And it is a game that could provide exceptional returns for everyone involved, including trademark attorneys.
Play smart from the start
Good collaboration between legal and marketing teams during brainstorming results in both savings in time and money for a business. Trademark candidates mooted by marketing departments can be quickly analyzed by a preliminary knockout search to either rule the brand name in or out, before moving the name along the trademark assembly line to a full and comprehensive clearance search with the assistance of a trademark attorney.
Examatch is a robust research and preliminary trademark search tool. It delivers exact and semi-exact match results across over 180 countries’ PTO databases enabling legal and marketing teams to see if their brand name candidates are already in use - early on during brand creation brainstorming sessions.
We’ve got your brand covered
You can access dashboards for every trademark owner and brand, showing their trademark activity by Nice class and product description, litigiousness and protected brand coverage, around the world, with links to PTO details.