Blizzard’s Departure From China Could Cost It $44 Million Thanks To A NetEase Lawsuit

Blizzard's Departure From China Could Cost It $44 Million Thanks To A NetEase Lawsuit

Blizzard and NetEase ended a 14-year partnership earlier this year. The pact had allowed the US publisher and developer to release its games inside of China. While both sides have blamed each other for the break-up, the divorce just got messier as NetEase is now suing Blizzard for $43.5 million for a wide number of claims.

According to the lawsuit that was first reported by Sina Technology (via WoWhead), NetEase claims that Blizzard had promised refunds to more than 1 million players who wanted them when the Chinese servers went offline for Warcraft, Diablo, Overwatch, StarCraft, and Heroes of the Storm on January 23, but this task fell to NetEase. The company is also seeking compensation for unsold merchandise inventory and claims that Blizzard violated licensing agreements, and demands redress for “unequal provisions” because of those violations.

Lastly, the lawsuit mentions “overlord clauses” between NetEase and Blizzard. This deal required NetEase to pay a sizable deposit in advance for several of Blizzard’s games, but Blizzard did not refund the company when these were not developed. As noted by PC Gamer, the wording of this deal could involve other products for Chinese consumers, such as existing products being retooled to pass the notoriously strict registration rules of that market.

This isn’t Blizzard’s first big money lawsuit, as in a more recent example focused on Activision Blizzard specifically, the company was sued by the US Department of Justice in a civil antitrust lawsuit, which appears to have been settled on the same day it was filed. Activision Blizzard also reached a settlement deal with the Securities and Exchange Commission in February, that saw the company pay $35 million to settle workplace charges.

Activision Blizzard has faced a wave of criticism in recent years over a variety of these workplace issues, and for more details, you can check out a timeline of all the major lawsuits and issues.

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