Delhi HC rejects Dream Sports-backed Rario's plea against MPL & Striker on NFT gaming

In its order, Delhi HC said the plaintiffs cannot claim to have an exclusive right over the use of an NFT technology that is freely available.

The Delhi High Court has dismissed a plea for interim injunction by Dream Sports-backed cricket non-fungible token (NFT) platform Rario against rival Mobile Premier League (MPL) and Striker to prevent them from offering fantasy gaming via NFTs.

In its judgement order, the court stated the plaintiffs cannot claim to have an exclusive right over the use of an NFT technology that is freely available.

Rario had filed a petition against MPL and Striker with the Delhi High Court in February 2023, alleging that Striker's player caricatures and identifiers, such as player names and surnames, infringe on the personality rights it has licenced exclusively from certain cricketers, such as Harshal Patel, Arshdeep Singh, and Umran Malik, in order to offer their digital player cards on the platform.

In its petition, Rario had claimed that it has spent Rs 148 crore to procure these licenses from nearly 170 players in the past two years, Moneycontrol reported on March 14.

It claimed these exclusive license agreements entitle only the company to create (mint) and distribute NFTs of these players, apart from allowing users to collect, trade and license them. Indian cricketers such as Harshal Patel, Arshdeep Singh, Shivam Mavi, and Umran Malik have also joined Rario's petition.

Striker, a startup backed by MPL, allows users to create teams with the digital player cards they own and earn points based on the real-life performances of these players, and compete in a range of fantasy contests. They can also trade player cards to earn money from Striker’s marketplace.

Striker works with a community of artists across the country to create cricket-themed art using publicly available events and recollections. Apart from the remuneration the artists get for their creations, they also get a commission on every card purchase and sale.

MPL is also offering digital player trading cards from Striker on its NFT marketplace, Moneycontrol reported on March 14.

On the other hand, Rario operates a cricket strategy game called D3 that was co-developed with Dream11 parent Dream Sports. The game allows Rario users to form squads with the digital player cards they own and participate in contests to earn cash rewards.

'Preventing Monopoly'

Subsequent to Rario's petition, skill gaming industry body All India Gaming Federation (AIGF) and social gaming and interactive entertainment platform WinZO had filed separate petitions in the Delhi High Court in March 2023, to be allowed to intervene in the lawsuit.

In its petition, AIGF had stated that not being able to use specific identifiers for players would have a drastic impact on fantasy sports platforms and could impact growth of smaller companies.

Meanwhile, WinZO had stated in its petition that Rario may use the court order to stifle its rivals who are operating similar formats in the space.

In a statement on April 26, WinZO co-founder Saumya Singh Rathore said that it is a "landmark judgement that will protect the interest of entrepreneurs in years to come as it permits the usage of publicly available information including scores in sports matches and pictures"

"The court has heard our prayers and held that the use of the player’s images especially as it is in the context of representing to the users and the statistics of that player is permitted fair use and is protected free speech which does not amount to endorsement" Rathore said.

She mentioned that the potential of sports engagement through gaming can't be contained by just one fantasy format and there is a huge scope for innovation in this category.

"Early monopolistic boundaries would have compromised innovation in the category and the cost of building new formats would have increased exponentially" Rathore said.

AIGF CEO Roland Landers said that it had intervened in the case since the case directly impacted the online gaming industry and sought to curb innovation, specifically in fantasy sports, and the NFT and blockchain areas.

"AIGF’s intervention focused on preventing monopoly over any part of the online gaming ecosystem, and allowing MSMEs to continuously innovate in the Web2 and Web3 space. Through the order, the court has recognised that the use of Web3 technologies and classic formats of online games cannot be restricted unless a clear violation of law is established, and has upheld the rights of small developers to build for India" Landers said.

Right of publicity

Striker co-founder Nitesh Jain also welcomed this judgement stating that Indie game developers like them "can't survive in a world where NFT tech is monopolised by a few"

"Just like you can't tell photographers to stop using color pictures available in public, you cannot ask developers and artists to not make NFTs out of publicly available images or information. This protects the rights of both indie developers who cannot afford expensive licenses, and the artist community that we work with to make art out of public information and images using this new technology (NFT)," Jain said.

Right of publicity, while available in the United States, is still to develop as a right in India and there is no legislation that covers this alleged right, said Abhishek Malhotra, Managing Partner, TMT Law Practice.

"The court held that the use of player images does not amount to endorsement, especially as the information contained in the NFTs is publicly available and cannot be monopolised by Rario. Even if the “right of publicity” can be said to exist as a common law right in tort, such an alleged right cannot prevail over the right of free speech" he said.

We have reached out to Rario for a comment and will update once we hear back.