NetEase Not Taking Blizzard to Court, One Man Seeking $43.5 Million Settlement

[T0@st]

According to a recent news article released by Chinese news group Sina Technology, NetEase has filed a lawsuit against its former publishing partner Blizzard Entertainment, to the tune of (around) $43.5 Million. The Chinese Internet technology company is seeking compensation, in the form of a very large refund, following Blizzard's total exit from the nation's online gaming sector - its server infrastructure in China was shut down in January of this year. The closing of Blizzard-related services represented a very abrupt end to a 14-year long relationship between the two online gaming specialists - press coverage at the time presented a tense situation involving many major disagreements - the partnership was broken because of unfavorable terms on Blizzard's part.

NetEase posits that it had to compensate its customer base through refunds from its own reserves, after the sudden shutdown of Blizzard's hugely popular MMO - World of Warcraft, and other online multiplayer game series including Overwatch, Hearthstone, Diablo and Starcraft. A significant chunk of the $43.5 million settlement is said to cover the company's cost in refunding part of its customer base - somewhere in the range of 1.12 million players - for discontinued games and services. NetEase is also reported to be seeking damages for broken license agreements, unsold merchandise inventory and the loss of access to future Blizzard intellectual properties.

Update Apr 25th: According to an article from PC Gamer, published today, NetEase is not taking Blizzard to court. It turns out that a serial litigator, Yang Jun, has included NetEase as an appellant in his filed legal documents - under another company name, The9, an apparently defunct former licensing partner. PC Gamer has been informed that Yang Jun has sued NetEase in the past, and that his latest batch of legal documents have been amended to reflect that he is the lone party in demanding a financial settlement from Blizzard.



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[Panther_Seraphin]

Pocket change for Activision/Blizzard so I suspect this will be quietly accepted and they will just move on.

Longer term I wonder how many will traverse the great firewall of china to access games like WoW on Western servers.

 

[RadeonProVega]

$43.5 Million will last me for the rest of my life. ​

 

[bug]

So NetEase sold goods it couldn't deliver, had to refund their customers and are now asking Blizzard to pay for that? Did I get this right?

 

[Sithaer]

Worry not Tencent already has a WoW clone/replacement in the works/to be relased:

 

[Wye]

loss of access to future Blizzard intellectual properties

How can someone claim your future? (except my wife)

 

[Kohl Baas]

$43.5 Million will last me for the rest of my life. ​

Well, you're not 1.12mill players. For them it's like $38.8 each...

 

[64K]

43.5 million dollars is trivial to Activision/Blizzard. Activision will just hork up another CoD and generate hundreds of millions of dollars in revenue.

 

[lepudruk]

The Chinese Internet technology company [..]

[.. ] the loss of access to future Blizzard intellectual properties

Heh, define irony..

 

[TechLurker]

Worry not Tencent already has a WoW clone/replacement in the works/to be relased:

It looks so generic; like stock 3D game asset generic. But at least it looks polished and modern enough to be a WoW replacement, and even easier to install playtime limiters and spyware.

 

[ThrashZone]

Hi,
Nice timing hell this is just chump change to ms

Microsoft to Acquire Activision Blizzard to Bring the Joy and Community of Gaming to Everyone, Across Every Device

With three billion people actively playing games today, and fueled by a new generation steeped in the joys of interactive entertainment, gaming is now the largest and fastest-growing form of entertainment. Today, Microsoft Corp. announced plans to acquire Activision Blizzard Inc., a leader in...

www.techpowerup.com

 

[Aquinus]

Maybe they should take the issue up with the CCP. This wouldn't be an issue if China didn't try to control every aspect of their citizens' lives. Servers outside of China work just fine... unless you're inside china and we all know whose fault that is.

 

[bug]

Maybe they should take the issue up with the CCP. This wouldn't be an issue if China didn't try to control every aspect of their citizens' lives. Servers outside of China work just fine... unless you're inside china and we all know whose fault that is.

Only an option if they wish to fall off the face of the earth tomorrow, Peng Shuai style.

 

[Aquinus]

Only an option if they wish to fall off the face of the earth tomorrow, Peng Shuai style.

Oh right, that's probably also why Blizzard is jumping ship. They don't want to play ball by China's rules, which is where Uncle Xi always wins. China could always be less authoritarian and let their people access internet resources from outside the country without discrimination, but that probably wouldn't work well for the CCP either. Can't look weak in front of your subjects. I guess this is truly why some people can't have nice things.

 

[ZeppMan217]

Blizzard pulled out because they didn't want to give NetEase unrestrained access to their IPs for NetEase's China exclusive projects. Now NetEase is suing em for not bending over. Ironic.

 

[Totally]

So NetEase sold goods it couldn't deliver, had to refund their customers and are now asking Blizzard to pay for that? Did I get this right?

Blizzard pulled the rug out from under them by suddenly noping out of the agreement, they're liable if they didn't have an exit clause for such in the agreement.

 

[bug]

Blizzard pulled the rug out from under them by suddenly noping out of the agreement, they're liable if they didn't have an exit clause for such in the agreement.

Yeah, this all depends on what's in the contract and how the events unfolded. We'll probably never know either.

 

[Guwapo77]

Blizzard pulled the rug out from under them by suddenly noping out of the agreement, they're liable if they didn't have an exit clause for such in the agreement.

Activision/Blizzard aren't stupid, I'd bet my left testicle they had a Legion of Lawyers on combing over the contracts prior to pulling out.

Hi,
Nice timing hell this is just chump change to ms

Microsoft to Acquire Activision Blizzard to Bring the Joy and Community of Gaming to Everyone, Across Every Device

With three billion people actively playing games today, and fueled by a new generation steeped in the joys of interactive entertainment, gaming is now the largest and fastest-growing form of entertainment. Today, Microsoft Corp. announced plans to acquire Activision Blizzard Inc., a leader in...

www.techpowerup.com

The FTC (US) and the CMA (UK) blocked this purchase as it stands today. So nothing to worry about there unless there are some modifications (intellectual property reduction) will this deal go through.

 

[DeathtoGnomes]

Activision/Blizzard aren't stupid, I'd bet my left testicle they had a Legion of Lawyers on combing over the contracts prior to pulling out.

With friends like you who needs testicles?
TBH, I dont see how a third party can be allowed to sue over the dispute, unless he is a stockholder or on the payroll of netease somehow

 

[mama]

"It turns out that a serial litigator, Yang Jun, has included NetEase as an appellant in his filed legal documents..."

Shouldn't that be added NetEase as a Respondent? Appellants usually commence proceedings in a higher Court.

 

[Totally]

Activision/Blizzard aren't stupid, I'd bet my left testicle they had a Legion of Lawyers on combing over the contracts prior to pulling out.

I think they just weighed their options, and saw that they stood to lose more maintaining the deal, esp where IP is involved, than any possible lawsuit. I'm just curious as to what cause the deal to go sour for them to take this action. Like you said they aren't stupid, access to IP and whatnot what would have been discussed and clearly outlined before drawing up the contract. My guess is either of two, NetEase found or worked in a loophole, or they weren't hitting the numbers they were expecting with a negative outlook. I'm leaning towards the latter.

 

[T0@st]

"It turns out that a serial litigator, Yang Jun, has included NetEase as an appellant in his filed legal documents..."

Shouldn't that be added NetEase as a Respondent? Appellants usually commence proceedings in a higher Court.

This is likely the wording (via translation) that WoWHead read first, and in turn interpreted that NetEase (or its defunct subsidiary) was the leading figure responsible for the filing. Jun was simply making his case look more official/grandiose.