“Dubai Discrimination” ends a “7-year dispute” over a famous electronic game

The Court of Cassation in Dubai brought down the curtain on a legal dispute that lasted nearly seven years, between the creator of a famous electronic game, which topped the global games store, and a company that owns the game’s publishing rights, after it rejected an appeal submitted by the latter to cancel a ruling issued by the Commercial Court of Appeal awarding compensation worth five million dollars to the benefit of… The American designer company, and rejected any other requests from both parties to the litigation.

In detail, the dispute began with a lawsuit filed by a company licensed by the Dubai Multi Commodities Center, specializing in the field of developing, publishing, marketing, promoting and selling applications and electronic games on phone devices and the Internet, in which it stated that the other party defendant is a company specialized in creating games, for which it designed an initial model of an electronic game to be played. Over the phone, an agreement was signed between the two parties granting the plaintiff an exclusive license to financially exploit the game program by copying, downloading, modifying, developing and publishing.

The plaintiff company stated in its statement of claim that it introduced updates and improvements to the game until it raised its quality and made it available to the public in 2015. It then drafted an agreement stipulating its ownership of the intellectual rights resulting from the updates, and specified a new profit percentage. Then the two parties signed another agreement stipulating that the defendant does not own ownership. Any intellectual property rights resulting from development and modernization, and the plaintiff obtained an exclusive license to financially exploit the game, while the defendant obtained an exclusive license to update, develop, publish, market and promote the game to end users around the world throughout the period of validity of the agreement, provided that it receives 20% of The profits are 80% for the plaintiff.

The plaintiff company added that it had already made many improvements until it became the No. 1 game on the play store, the most downloaded, and achieved high profits, after spending huge sums of money on it. It has also concluded many agreements with entities and distributors to sell, publish and market the game.

In December 2017, it received notification from the defendant terminating the publishing agreement, and the game was deleted from the platforms, with the plaintiff company retaining its ownership of the intellectual rights related to updates and improvements.

The plaintiff indicated that they later negotiated to purchase the intellectual property rights for the game, and the defendant company offered $21 million to purchase the rights from the plaintiff, but they did not agree on an appropriate method of payment, pointing out that she was surprised by the defendant company re-copying the game that had been developed before. The appellant presented it in a similar way, whether in form, design or style. It also marketed it through electronic stores and seized the game’s revenues. It defamed the plaintiff’s reputation and claimed that it had stolen the game and unlawfully seized development and modernization, which caused damage to the latter.

The plaintiff company requested compensation amounting to 100 million dirhams before the court of first instance.

The defendant company filed a cross-suit in which it requested that the other party be obligated to pay the revenues it had unlawfully obtained from the game.

After examining the case and the expert report, the court of first instance ruled that the plaintiff in the original lawsuit had the right to intellectual property rights over all development and modernization work, and obliged the company that designed the game not to infringe on those rights in the future, and to pay an amount of 719 thousand dirhams to the plaintiff company that published and developed the game.

In the cross-case, the same court ruled compensation amounting to 453 thousand US dollars.

The two parties appealed the ruling before the Court of Appeal, which overturned the initial ruling and ruled in favor of the American company that designed the game to pay compensation worth 5 million and 153 thousand dollars, equivalent to about 18 million dirhams, while the rest of the parties’ requests were rejected. The appeal ruling was not accepted by the publishing company that developed the game, based in Dubai, so it appealed it before the Court of Cassation, which closed the curtain on the dispute that had extended for nearly seven years and ruled to reject the appeal and uphold the appeal ruling.

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