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How not to Draft an Esports Contract - Dota 2 Edition

July 23, 2018

I'm going to draft more short posts on subjects germane to my website whenever I see topics of interest to share.  Today I have a fun one--a Dota 2 professional contract that violates all rules of competent contractual drafting.  While the player in question never ended up signing it (he apparently played for the team under a verbal contract since he was unhappy with the language) it is still instructive of the deals that some Organizations are still attempting to push on the players.  I hope you enjoy.

 

 

The contract I am discussing today is the contract between the Dota 2 team "Admiral-Dota," and Dota 2 professional player Jimmy "DeMoN" Ho. (here is a link to the original posting of the contract by Demon)  Demon posted a long explanation of the fallout of his professional relationship with Admiral on Reddit, which is definitely worth a read.  Many of the issues he had with the management of his team could have been addressed at the contractual drafting and signing phase, which may have helped avoid the grief that both parties have apparently experienced.  One interesting wrinkle is the fact that Demon never signed the contract--so the verbal agreement that existed between Demon and Admiral was ambiguous at best.  

The Good

  • Clearly established period of the time for the contractual relationship (Jan - September 2018);

  • Prohibition on betting (it doesn't explicitly state esports betting, but a general prohibition would cover this.  My esports contract template prohibits esports betting as well);

  • States the monthly salary, although I would also have included some pro rata language to cover the periods of time that aren't full months on both ends.  The bi-weekly pay arrangement might be sufficient.

The Bad

  • The "morality clause" language is too sparse;  "Unprofessionalism"  does not give the player enough notice as to what behavior is unacceptable, and this ambiguity can only lead to problems;

  • Granting open ended intellectual property rights to the player's likeness without an expiration date or limitation language;

  • Players cannot join other "e-Sports" tournaments without permission, but does not define what the Admiral considers a tournament.

The Ugly

  • Termination language for "poor performance" or not following "team rules," without defining said rules.  Both of these termination criteria are ambiguous to the point of likely being unenforceable in many situations.  Of course, it would be up to the player to attempt to enforce the contract in court, and I don't know how that would play out in the Philippines court system;

  • The "buy out" language without a pre-determined price point for the buy out.  Some courts might see this as meaning the buyout amount should be a "reasonable" amount, which could be open to interpretation through expert testimony (such as another organization owner opining about Demon's value), but this is a nightmare in and of itself;

  • No language about payment for travel expenses, equipment, housing, etc;

  • The team has the right to press legal charges? Unless this is something that is just very different about the Filipino jurisdiction, this is completely superfluous language. 
     

Ultimately, the Player was aware of the severe issues with the contract, and decided not to sign.  It was also a good decision to not sign the contract on the assumption that it would be revised later--the Organization would be under no obligation to later change the terms.  I can't same I blame him for the decision to enter into the verbal contract while attempting to work out the terms of the written agreement, although he did take a risk continuing to play for the Team while unsigned.   

 

I hope the blow-up around the Admiral/Demon team arrangement continues to make people more aware of the benefits to be gained by proper contracts between Organization's and Player's in esports.  

 

 

 

 

 

 

 

 

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