27 Jun





 min read

10 Legal Issues in Esports

In the grand scope of things, the rapidly growing esports industry is still in its infancy. As this entirely new area of industry develops so too will the law. Today, we are covering ten potential legal issues that esports organizations and teams might find themselves running into.

1. Gambling in Esports

This one is a no-brainer and has already had to be addressed multiple times within esports. Most esports have been ruled as “games of skill,” so the legality of gambling on esports is much like traditional sports, it depends on the state you are in. Given that, issues of illegal gambling activities may come up for esports.

2. Labor Contract Creation and Execution in Esports

Some organizations running esports teams are relatively new. Consequently, contract negotiations and execution can sometimes be dubious at best. This is a potential hotbed for legal action, especially considering our next topic.

3. Unions and Collective Bargaining in Esports

When esports started, many of the players were simultaneously the heads of their prospective teams and organizations. The control that a player had over the direction of their team and their relationship with that team was much greater than it is now.

Currently, due to the lack of player unions or an overarching regulatory body, organizations wield the majority of the power when it comes to player contracts, play time, trade deals, and the like.

That being said, player unions are beginning to form, and collective bargaining is being pursued. Since the power dynamic within esports has been so one-sided for so long, there could be some very intense legal issues incoming.

4. Cheating in Esports

There are many ways to cheat in esports and some are very hard to track. One such form of cheating is known as boosting. Boosting is the practice of signing on with another player's login and playing on their account. In South Korea, this crime comes with a fine of $18,000 and a two-year prison sentence.

Still, other forms of cheating are as old as the invention of sports. Doping is one of the most common forms of cheating in esports. Taking medication to increase reaction time and reflexes is a serious problem in the industry and has gone largely unaddressed so far.

5. Immigration Issues in Esports

Immigration is one issue that esports organizations are constantly dealing with. Due to the international nature of esports, the majority of professional teams around the world have a player or players from another country. So, they often need a visa.

The problem is that many countries have yet to recognize playing on an esports team as an official reason for a visa. Keeping foreign players in the country has been quite an issue for many organizations, and some sort of litigation may arise to press for more recognition from countries around the globe.

6. Sponsorship Issues in Esports

Since esports is such a new industry, sponsorships relationships for teams are quickly being developed. But because there are no established industry standards, these newer organizations are creating contracts that are unique to esports.

Everyone is proceeding with some idea of how to do this, but to a certain extent, they are pioneering. That brings the potential for contract execution lawsuits in esports in the future.

7. Copyright and Streaming Laws in Esports

Streaming esports is completely free, but the game you are streaming is intellectual property of the developer and publisher. Many organizations and tournaments have to think about copyright laws when choosing what to stream. It can be a bit of a high-wire act at times too since copyright laws can cover several parts of a game but not everything.

8. Rules and Regulations in Esports

Something that is long overdue in the esports industry is a regulatory body to provide a regulatory structure to the industry. The lack of such an organization leaves different game companies, tournaments, and local regions with hundreds of rules and regulations that all differ from each other.

This landscape is chaotic and offers a lot of opportunity for lawsuits. However, a global regulatory institution would be hard to create for esports specifically. Many esport games are different from each other. Rules and regulations that would work for every game would be nearly impossible to make.

9. Intellectual Property Issues in Esports

Imagine if one company owned the game of soccer. Like owned the whole game. You could not play soccer without this company allowing you to use their product/property to do it.

How would FIFA (the regulatory institution for soccer) regulate and establish rules for teams and organizations when only the company that owns the game gets to decide how their game can be used? If your answer is “I have no idea”, the industry of esports is right there with you.

10. Slander and Verbal Abuse in Esports

This is perhaps the most interesting legal issue that has cropped up in recent years. Many games have and encourage players to have a certain level of ego and even toxicity. Posting a prideful comment in the chat or a sarcastic emote to upset your opponent is extremely common in esports.

This can turn toxic very quickly.

But then those same players that grew up in this environment go into a career in gaming. Some of the professional players retire and become CEOs. Some of them take managerial roles in esports. Many of them find themselves in a career in this ego-encouraging environment.

Here a certain level of toxicity is accepted. It’s understood. That player’s flaming, raging, tilted, etc.

This can lead to people in authority communicating in a very harsh and blunt manner that they use to do while gaming. It can lead to making outrageous statements about an opposing team, their manager, or their owner.

Consistently berating your employees creates a toxic work environment and can bring up abuse lawsuits. Making false statements about others, while fun for the ego, can bring up slander cases. As of 2022, a major esports organization is currently being investigated and potentially sued for this exact reason. So, this is one to watch out for.

Garrett White lives in Houston Texas with the most amazing woman in the world, his wife. Any time he isn’t running D&D, playing video games, or reading a book, he is writing short stories and articles about one of those things.

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