By Ali Haider, Chapman University School of law and Co-Chair of the Esports Law Society
and Austin Mack, Chapman University School of law and Co-Chair of the Esports Law Society
As co-chair of the sports industry team at Foley & Lardner, LLP, Jonathan L. Israel focuses on labor and employment issues. This interest and passion stems from his days at the National Basketball Association, where he served as in-house counsel to the NBA and its affiliated entities and teams.
The esports space will no doubt need his expertise, and that passion, as it grows in numbers and size.
We caught up with Israel, a partner at the firm based in New York City, and asked him a few questions on what he sees in the esports legal arena:
Question: As you enter the esports legal space, what has surprised you the most?
Answer: I have spent much of my legal career working in traditional professional sports. It is often said that esports (i.e., professional video gaming) has much to learn from traditional sports, but I have found that traditional sports has much to learn from esports.
Q: Has the growth in the market run parallel to the growth in lawsuits in the esports space?
A: As investment and revenues grow, legal issues tend to “grow” as well. It depends on who you are talking about in the esports space. There are big, well established game developers and then there are small startup esports organizations developing a number of teams or other types of business around esports or videogaming. When you have these companies that are not highly capitalized and just trying to survive in a new market, there are a lot of legal issues that may exist out there but don’t necessarily get the kind of focus our attention they might otherwise need.
Q: How does cheating impact the integrity of the game, and in return impact the legal representation in the space?
A: From a business perspective, sports sell competition; it is the essence of its business. Rigged/fixed competitions or cheating can destroy the product.
Q: Why is there such a disproportionate representation of women in the esports field?
A: This is a hard question to answer – there are a variety of factors likely at play and may be impacted by what aspect of the esports field is being assessed – game developers, esports organizations/teams, gamers, etc. There is a long and troubled history of sex discrimination in the video gaming industry, including within on-line platforms.
Q: Do you believe the infrastructure of the esports space, which some deem as a monopoly, will change over time and into what?
A: “Esports” involves a game that is owned by the game developer – a context far different from professional sports where the game itself is not somebody’s intellectual property. Game ownership is the foundational aspect of the industry and creates significant legal and economic control. Additionally, esports teams are no longer solely focused on just having an Overwatch team or a League of Legends team, but are now transforming into diversified business, whether it is developing consumer products or hiring influencers and generating revenue through other streams.
Q: Is there a recent case your firm is or has recently worked on that is particularly exciting that our readers would find interesting?
A: We have done a variety of work that is confidential, and I can’t discuss, but some of the work that I have been doing involves the engagement of talent by esports organizations. The Tfue/Faze Clan case (was not one that we handled) but it lit a fire within the industry, and organizations began to take a hard look at what they were doing contractually with talent. This case and its fallout are a great example of how growth of business and legal issues go hand in hand. (Note: the Tfue/Faze Clan case was settled, out of court)