In 2011, when we started doing esports tournaments and events. We didn’t even think of consulting a lawyer let alone sign a contract for any of our sponsorships / team requirements. It wasn’t until early 2015 that we got a lawyer on retainer (yikes!). We took a huge amount of risk and having a lawyer is about mitigating risk and understanding the ins and outs of the legal document you’re going to sign.
If I were to start planning esports events as a new person to the industry, I’d ensure that contracts with staff, sponsors and others as needed would be absolutely key to ensure that both parties uphold their end of the bargain. A lawyer would be one of the first people I speak with.
In what scenarios would you need a lawyer in esports? Here’s when:
- You’re putting your name on any single piece of paper. Anytime I sign anything I get my lawyer to look at it. Don’t care how short it is. Legal contracts can be tricky. Make sure you do this
- You’re a player and you’re about to sign a life time deal with an organization. They’re pressuring you into signing quickly so you can become one of the boys. It’s absolutely required you get a lawyer to look at this contract because of the following:
- The contract could have specific buyout clauses that limit your ability to move teams
- Your buyout clause is an insane amount of money that will keep you on the team for a long time. This generally benefits the team organizer and not you
- There are no clearly defined employee / employment standards in the contract
- Are you an employee? Contract worker? Do you have to work specific hours? Do you have any performance bonuses?
- Do you have any living stipends as a player?
- How are you getting paid? Weekly, bi weekly? Whenever you win?
- Do you get a share of prize pool winnings? If so, what will it be?
- Can you leave the team easily? If so, what sort of notice do you need?
- The contract could have specific buyout clauses that limit your ability to move teams
- Another scenario is, you’re about to run an esports tournament and you’re looking for a sponsor to cover some of it.
- Here’s what you need to look out for:
- What are the sponsor requirements? You discussed them in email, do they match up to the contract? You want to be sure that the contract stipulates what you will and won’t do for your sponsor. It creates a better relationship that way.
- What are your payment terms? Does the sponsor have a year to pay you? How are you going to cover your tournament if so. Make sure you have a payment term in there. I generally ask for 50% upfront and then the remaining 50% balance net 15-30 after the tournament. This may require some back and forth between your sponsor / legal team(s)
- Do teams require a specific contract? Ie media obligations, payment terms (when are you paying teams) etc. Make sure you plan your esports event correctly!
- Here’s what you need to look out for:
- Additionally, you’re hiring a production team, ensure that it’s properly staffed and that the event is run to your needs. However, this will take some time to hash out. Make sure you have a statement of work in the appendix of what will and won’t be done.
- You’re hiring a casting team, same as the above. You’re scheduled for specific matches on specific days but a caster doesn’t show up. Can anyone else cover? Is this covered in your contract? If not, whoops. Make sure you at least have those discussions with your talent team beforehand!
Here are some lawyers that I know of (I am not officially endorsing them)
- If you’re in Canada and specifically the Toronto area. MKM Esports – Talk to Josh Marcus / Evan Kubes. Great guys!
- Aluvion Law – specifically deal with small businesses
- If you’re located in the USA – You can speak with ESGLaw
- A lawyer who understands gaming + is good at contracts. They don’t have to be lawyers in esports. In fact, this is what I went with. Our lawyer is A+! You can contact lawyers and see if they offer free consultations. Ask what their hourly rates are.
Tips for dealing with lawyers
- Figure out if they offer free consultations
- Ask what their hourly rates are
- Do you feel comfortable with them and do they understand your business generally?
- What sort of clients do you work with?
- Do you represent anyone similar to me? (They may reject you if there’s a conflict of interest)
- Discuss your issue in detail (lawyers love detail). Be concise and precise. Make sure you come prepared
- Understand there are expectations with the legal process. It takes time and you may not get everything you want
So, to answer the question. I would STRONGLY RECOMMEND getting a lawyer on retainer at minimum. Many lawyers offer free advice or a consultation. I’d highly recommend even booking that if you’re unsure. An an ounce of prevention is worth a pound of cure.