“We haven’t received the lawsuit yet, but we are confident we aren’t in breach of any licensing agreements,” the statement said. “The terms [that] NetEase appears to be complaining about reflect standard industry practice and have been mutually beneficial for years.”
“While this persistent campaign by one former partner is disappointing and puzzling, it’s important to note that we have enjoyed nearly two decades of positive experiences operating in China, and remain committed to serving players and protecting their interests,” the US firm said.
NetEase did not immediately respond to a request for comment on Tuesday.
The Shanghai lawsuit marks an escalation in the dispute between NetEase and Blizzard Entertainment on the treatment of local players of US-developed games since the end of 2022.
Founded in 2008, Shanghai EaseNet Network had been directly responsible for overseeing parent NetEase’s licensing deal with Blizzard Entertainment.
Under China’s tough video gaming regulations, foreign titles can only be published on the mainland via local distributors. Blizzard Entertainment has yet to announce the latest progress on its negotiations for a new Chinese distributor.
NetEase responded by describing the offer as unfair, as Blizzard Entertainment also negotiated at the same time with other companies for a three-year licensing deal on the mainland.
The NetEase lawsuit has come at a time when Blizzard Entertainment is “in a critical period” in light of the acquisition of parent Activision Blizzard by Microsoft Corp, according to Zhang Shule, an analyst at CBJ Think Tank.
The litigation could turn into a “slap on the face” for Activision Blizzard, Zhang said.
In a separate lawsuit, NetEase has filed a complaint against Blizzard Entertainment and The9 – the Chinese operator of World of Warcraft before NetEase struck a licensing deal in 2009 – for rights infringement, according to information on Chinese business registry site Tianyancha.
The case is expected to hold its second hearing on Wednesday at a court in Hefei, capital of eastern Anhui province.
