Cheats never prosper: The potential impact of Take-Two v James on cheating in esports

Posted in eSports Intellectual property

Author: Dan Harman

For as long as there have been games to win, there have been people willing to do anything to win them. From cork-filled baseball bats, sanded cricket balls, and the Hand of God to performance-enhancing drugs and state-sponsored doping programmes, cheating will always be an intrinsic part of sporting culture – and esports is no different. In esports, there is ample opportunity for an individual to exploit the very code of the games they play. This has led to the development of software tools such as aimbots (which automatically aim a player’s weapon at the enemy), rapid fire hacks (which simulate faster firing commands than a player could initiate in the real world, effectively turning a pistol into a machinegun), and triggerbots (which automatically fire the weapon when an enemy enters a player’s aiming reticule), to name but a few. In a world where the esports and online gaming ecosystem represents billions of dollars in revenue, gaming the system becomes more than just harmless fun – it becomes a costly problem.

In January this year, Take-Two Interactive Software Inc (Take-Two) and its subsidiary, Rockstar Games Inc (Rockstar), were successfully awarded summary judgment in Take-Two v James against the creators of paid-for cheat software known as “Epsilon”. Many of those reading will recognise Take-Two and Rockstar as the publisher and developer of the bestselling Grand Theft Auto V (GTAV) – a game which at the time of writing has sold more than 130 million copies and which Epsilon was designed to modify. This article will explore the background and facts to Take-Two v James, and how this judgment signals a clear pushback against those that don’t believe in playing fair.

Background

Epsilon was a form of cheat software known as a “mod menu” which manipulated GTAV in order to grant advantages to its users such as weapon and vehicle spawning, in-game currency generation, and the general ability to disrupt other players’ gameplay. The claimants stated that while Epsilon did affect the user’s single-player game, the commercial impact of the software was more pronounced in the online version, where cheaters “could seriously harm the gameplay experience for other players”.

Five individuals were originally issued with claims for i) breach of contract; ii) inducing breach of contract; and iii) copyright infringement by Take-Two and Rockstar, however a settlement was reached with the first, second and third defendants by way of consent order. The fourth and fifth defendants admitted being involved in the development of Epsilon, but denied liability.

Breach of Contract

Players of GTAV online are required to accept the Rockstar end-user licence agreement (the EULA), terms of service, and online code of conduct (together, the Contract) before playing. The claimants stated that at the time the defendants entered into the Contract, there were multiple clauses which were pertinent to the use of software such as Epsilon which were then breached. In particular, the EULA required that:

[Users] agree not to, and not to provide guidance or instruction to any other individual or entity on how to:
k. cheat (including but not limited to utilizing exploits or glitches) or utilize any unauthorized robot, spider, or other program in connection with any online features of the Software;
l. violate any terms, policies, licenses, or code of conduct for any online features of the Software;

Falk J was satisfied, having considered the witness statements of the fourth and fifth defendants, and having seen video evidence of Epsilon in action, that the primary function of the software was to enable cheating, and there had therefore been a clear breach of clauses k and l by both defendants.

One point of note is that the fifth defendant, having turned 18 in March 2019, was a minor at the time he first used GTAV and entered into the Contract, and asserted that he was not bound by the contractual terms and could not, therefore, be sued for breach of contract. Falk J refused to find that the fifth defendant had no real prospect of successfully defending the claim (the summary judgment standard) for breach of contract, but noted that the defendant’s age had no bearing on the other points at issue, namely liability for inducing breach of contract and for breach of copyright.

Inducing Breach of Contract

The claimants were found to be liable for inducing breach of contract. Below, we summarise the four conditions required to establish this tort, and the Court’s findings in respect of each.

 

Conditions needed to establish the tort of inducing a breach of contract

Court’s findings

(i)

A breach of contract occurring between the claimants and a third party.

A breach of contract occurred when third parties downloaded the Epsilon software and used it in contravention of the Contract.

(ii)

Some form of inducement or procurement of the breach by the defendants.

By marketing and supplying Epsilon for the express purpose of allowing users to cheat, which inevitably resulted in breaching the Contract, there had been sufficient inducement by the defendants.

(iii)

Knowledge on the part of the defendants that they were inducing or procuring a breach of contract by some third party.

Both defendants had admitted they knew of the existence of the Contract, and that users of Epsilon were receiving bans for using it in-game. It was sufficient, in establishing the required knowledge, that the defendants had an awareness of the Contract and deliberately decided not to enquire into its terms.

(iv)

Intention on the part of the defendants to procure that breach.

Intention was also established by the defendants being aware of the Contract, the bans that users were receiving for using Epsilon in contravention of that agreement, and their decision to purposefully turn a blind-eye to it.

 

The tort was deemed actionable as Falk J was satisfied from the witness evidence that damage had been suffered by the claimants; the defendants were therefore liable for inducing breach of contract through the sale of Epsilon.

Copyright Infringement

The claimants also alleged infringement by the two defendants on several points contrary to the Copyright, Designs and Patents Act 1988 (the CDPA):

Infringement by copying a copyrighted work (s16(1) CDPA)

The claimants alleged that the operation of Epsilon infringed their copyright in the GTAV work in contravention of s16(1) CDPA, which prohibits individuals from copying a work without a licence from the copyright holder.

The claimants’ justification for this infringement was that the development and use of Epsilon required the copying of significant parts of the GTAV executable file and libraries, allowing users to access weapons or other objects which would not otherwise be available to a player in the same position who was not cheating. The defendants stated in their defence that using Epsilon did not involve making copies of a lasting nature, or any permanent or lasting change to the user’s hard drive. The operation of Epsilon simply involved taking information from the GTAV library files, and reproducing the corresponding weapon/vehicle in-game. The copies were made only while the game program was running, and the game file as it existed on the hard drive was unaltered. Falk J was not persuaded by this defence, referring to s17(6) CDPA which explicitly states that copying includes the making of copies which are “transient”. However, she did not explicitly conclude on whether the defendants’ actions amounted to an infringement under s16(1) CDPA.

Infringement by authorising others to copy a copyrighted work (s16(2) CDPA)

Falk J considered in some detail the claimants’ assertion that the defendants had infringed their copyright in the GTAV work by authorising users of the Epsilon software to copy it, in contravention of s16(2) CDPA. She saw the authorisation as being an “authorisation by supply” (considered in Twentieth Century Fox v Newzbin at [90]), which required consideration of factors including: i) the relationship between the authorising and infringing parties; ii) whether the product supplied was capable of infringing the copyright; iii) whether the product supplied would inevitably be used to infringe; iv) the level of control retained by the supplier; and v) whether the supplier had taken steps to prevent infringement.

By supplying Epsilon, there was an undeniable relationship between the authorising and infringing parties. This relationship was reinforced by the ongoing updates, patches, and support the defendants provided to users of the software, which also indicated a high degree of control over the product. Due to the invariable requirement for the software to copy the GTAV executable file and libraries (notwithstanding the transient nature of the copies), the product was capable of infringing, and would inevitably be used to infringe, copyright.

The defendants attempted to raise several defences to the infringement claim, including a purported disclaimer of liability in relation to the use of Epsilon in online gameplay, which was considered to be “window-dressing” (of the type disregarded in EMI Records v British Sky Broadcasting at [65]), and was disregarded. Additionally, the argument that the source code for the software was publically available and the defendants had downloaded it from a well-known cheating site was unconvincing. Finally, a decompilation defence under s50B CDPA was raised, which is intended to allow computer programs to be copied for limited purposes in the process of creating a new, standalone program which interacts either with the decompiled program or with others. This defence failed, as s50B(1) CDPA defines decompilation as being the process of converting a program expressed in low-level language into a version expressed in a higher level language; Falk J did not consider this to fit with the description of how the Epsilon product was produced. In any event, the s50B defence would not be a defence to the infringement under s16(2) of authorising the copying by others; it would relate only to that particular process of decompilation.

Falk J was therefore satisfied to the summary judgment standard that the act of generating in-game assets by forced reproduction of library information necessitated copying, and by selling the Epsilon software to consumers, the fourth and fifth defendants had authorised the copying of the GTAV program, or substantial parts of it.

Infringement by circumventing technical protection measures (s296 CDPA)

The claimants alleged that the Epsilon program, in order to perform its function, must have incorporated a means of circumventing the technical devices built into GTAV which would ordinarily protect against unauthorised hacking or tampering. Falk J did not make a finding on this point, partly on the basis that it did not impact her finding of summary judgment in favour of the claimants, but partly also because she felt that this was the one area where the defendant’s evidence could be of potential support to their case.

Judgment

Falk J was satisfied to summary judgment standard in favour of the claimants that the defendants had no real prospect of defending the claims against them for breach of contract (in respect of the fourth defendant), inducing breach of contract, and copyright infringement under s16(2) CDPA, and there was no other compelling reason for the case to proceed to trial.

Wider esports impact

Consider Take-Two alongside the earlier case of Blizzard v Bossland. Bossland produced and sold software, in the form of both cheats and bots, for the highly successful online multiplayer games World of Warcraft, Diablo III, Hearthstone, Heroes of the Storm, and Overwatch, which enabled users to gain an unfair advantage over other players.

The similarities between this software and the Epsilon program are apparent, and before the case proceeded to trial, Bossland accepted liability for inducing breach of contract and authorising copyright infringement; two of the three claims brought against the defendants in Take-Two. Developers and publishers in the esports sector may therefore find it useful to ensure that their EULAs are unambiguous regarding their intolerance for cheating, and regularly require players to positively accept these terms in order to continue playing. This will then allow for a clear focus when drafting future particulars of claim against the creators of cheating software. Such actions could also mean that players choosing to utilise cheating software in highly-publicised esports tournaments (the physical embodiment of a billion-dollar industry) may have similar claims levied against them for not only copyright infringement resulting from the software’s use, but also for breaching the terms of the agreement they entered into when they initially signed up to play. It is difficult to determine how such a claim would be found if strongly contested, but publishers and developers should take some comfort in the clear avenues available for protection against these creators. Players tempted by these programs would also do well to remember that winning isn’t everything.

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