Chinese game giant NetEase are set to sue Activision Blizzard to the tune of $43.5m over purported licensing violations related to their previous deal.
Before their very public breakup earlier this year, Blizzard and NetEase maintained a lucrative licensing agreement wherein NetEase would publish and run games such as Overwatch and World of Warcraft in the country for Blizzard. However, it seems now that NetEase isn’t willing to forgive or forget and is now set to levy legal action against Activision Blizzard for lost revenue and liabilities incurred as a result of the breakup.
According to Chinese media conglomerate Sina Technology (via Wowhead) the case includes accusations that NetEase was left liable for refunds to players that Blizzard had promised to cover, and that Blizzard had not refunded deposits for a number of games cancelled in development, as well as grievances around the deal itself. Since the loss of service, players on a number of Blizzard titles including Overwatch, Hearthstone, Diablo and World of Warcraft have all lost access to their accounts.
Frostbite for Blizzard
Although some have questioned NetEase’s decision to raise previous grievances, about the purported unequal nature of the deal, other allegations appear far more serious. If Blizzard were found liable for the costs NetEase suggested it would not be anywhere near a deathblow, but it would be a severe knock to the company and to their reputation in China.
NetEase and Blizzard are still partnered together for the controversial but still very popular Diablo: Immortal, which suffered a rocky launch last year in China. The fact that the two previously had a lucrative relationship appears to have stung NetEase heavily, and Blizzard themselves have had difficulty in replacing their working relationship with NetEase, ending with neither party really satisfied.
Although the Chinese game industry has begun to pick up significantly over the past few months, if this lawsuit is anything to go by, there is still tension amongst international partners. Whether this results in Blizzard and NetEase making up or more likely dividing them further will only be clear when the results of the legal action are made apparent.
