Bungie Wins $4.3 Million Award Against Cheat Seller in Arbitration
In 2021, Bungie filed a complaint at a federal court in Seattle, accusing AimJunkies.com of copyright and trademark infringement, among other things.
The same accusations were also made against Phoenix Digital Group, the alleged creators of the software.
AimJunkies denied the claims and argued that cheating isn’t against the law. In addition, it argued that the copyright infringement allegations were ungrounded because some of the referenced copyrights were registered well after the cheats were first made available.
Court Dismissed Bungie’s Copyright Claims
Last May, U.S. District Court Judge Thomas Zilly largely sided with AimJunkies. The original complaint didn’t provide sufficient evidence for a plausible claim that the ‘Destiny 2 Hacks’ infringed any copyrights, the judge concluded.
This was bad news for Bungie, but the court allowed the game developer to amend its complaint, which it did. That copyright infringement dispute is still ongoing and on its way to a trial that’s expected to take place later this year.
In 2022, Judge Zilly referred several of the non-copyright-related complaints to arbitration, including allegations that AimJunkies’ cheats violated the DMCA’s anti-circumvention provision and were illegally sold to third parties.
Arbitration Judge Sides with Bungie
The arbitration process was conducted behind the scenes, but Bungie shared the outcome with the Washington federal court a few days ago. In a resounding win for the developer, Bungie walked away with an award of $4.3 million in damages and fees.
The bulk of the award relates to DMCA-related damages. According to arbitration Judge Ronald Cox, the evidence makes it clear that AimJunkies and third-party developer James May bypassed Bungie’s technical protection measures in violation of the DMCA.
“May testified that on many occasions, he connected reverse engineering tools to the Destiny 2 process in order to reverse engineer it and develop a cheat for the game,” Judge Cox writes.
“He also testified that after being caught and banned by Bungie several times for doing so, he attempted various ways to bypass the bans and circumvent the protections Bungie had in place to prevent reverse engineering.”
All Liable for Circumvention
May is not an employee of AimJunkies or its parent company Phoenix Digital. However, the latter can be held liable; the reverse engineering was carried out to develop the cheating software, which was sold and profited from.
“Thus, the remaining respondents are liable for May’s violations. They are likewise liable for the circumvention by the many users of the cheats sold by Phoenix on the website,” Judge Cox writes.
The arbitrator concludes that the circumvention was malicious, which entitles Bungie to $2,500 per offense. Based on 102 violations, total damages amounted to $255,000.
In reaching this conclusion, the testimony of AimJunkies owner David Shaefer was disregarded. Judge Cox found his testimony non-credible, partly due to Shaefer substantially understating revenue from the sale of the cheats.
In addition to violating the DMCA’s anti-circumvention provisions, the defendants were also found liable for trafficking in circumvention devices. Or put differently, selling and shipping the cheats.
Sales of the cheats and loader, which effectively bypassed Bungie’s copyright protections, amount to 1,361 copies in total.
“The evidence shows that Phoenix sold more than one thousand copies of the cheats. They also distributed more than one thousand copies of the cheat loader that was used to inject the cheats into the Destiny 2 process.
“Given respondents’ egregious and willful conduct, including their ongoing concealment of sales, Bungie is entitled to the full statutory damages available,” Judge Cox adds.
Trafficking violations resulted in a $3,402,500 award, and when added to damages for circumvention violations, an award of $3,657,500 covered all DMCA violations.
$4,396,222 and Forward
The arbitrator also sided with Bungie’s claims regarding breach of contract, tortious interference, consumer protection, and spoilation. As such, the game developer is entitled to attorneys’ fees and other awards.
In total, an award of $4,396,222 was handed to the game developer.
Last week, Bungie asked the federal court to accept this final award and approve an associated injunction, which prevents the AimJunkies defendants from engaging in any similar activities going forward.
In addition, Bungie is using its arbitration successes to defend against AimJunkies’s counterclaims in the ongoing copyright battle.
AimJunkies argued that by decompiling and reverse-engineering its cheat software, Bungie violated AimJunkies’ terms of service and breached the terms of its contract. Bungie says that the arbitration result counters AimJunkies’ claims since it found the software itself illegal.
“Phoenix Digital’s Terms of Service, which apply to the sale/license of Defendants’ Destiny 2 cheat software, are void because they are in violation of public policy and/or illegal,” Bungie countered in a filing last Friday.
A copy of the arbitration Judge’s conclusions is available here (pdf). Bungie asked the federal court to confirm this (pdf) and enter a judgment accordingly
From: TF, for the latest news on copyright battles, piracy and more.