TYGlobe

I. Introduction

With the rapid development of China's gaming industry, disputes over game copyright infringement have been increasing, with practices such as "skin-changing games," plagiarism of gameplay mechanics, and unauthorized use of artistic resources emerging frequently. In such cases, determining the amount of compensation remains a core challenge in judicial practice. On one hand, games, as composite works, possess unique characteristics in value assessment; on the other hand, the profits from infringement and the losses suffered by rights holders are often difficult to quantify precisely. This article examines the issue of compensation amounts for game copyright infringement from perspectives including legal basis, factors influencing compensation determination, evidence investigation methods, typical cases, and comprehensive analysis.

II. Legal Basis

(1) Copyright Law of the People's Republic of China (Amended in 2020)

Article 54 establishes a four-tier progressive calculation system for compensation amounts combined with punitive damages.

First layer: The rights holder's actual losses. These refer to the actual economic losses incurred by the copyright owner due to infringement, including reduced sales revenue, loss of market share, and loss of licensing fees.

Second layer: The infringer's illegal gains. When actual losses are difficult to quantify, compensation may be calculated based on the benefits obtained from the infringing act. In the gaming industry, this typically includes operating revenue from the infringing game, recharge transactions, advertising income, and similar sources.

Third layer: a reasonable multiple of royalty fees. The compensation amount shall be determined by referring to the reasonable multiples of copyright licensing fees. In the gaming industry, reference may be made to licensing fees for similar games.

Level 4: Statutory compensation. When the actual losses of the right holder, the illegal gains of the infringer, or the rights usage fees are difficult to determine, the People's Court shall award compensation ranging from RMB 500 to RMB 5 million based on the circumstances of the infringement. Following the 2020 amendment, the upper limit of statutory compensation was significantly raised from RMB 500,000 to RMB 5 million.

Furthermore, in addition to the aforementioned four-tier compensation system, punitive damages are imposed for intentional copyright infringement with serious circumstances to further deter such acts and protect the interests of copyright holders: For intentional infringement of copyright or related rights under severe circumstances, compensation may be awarded at one to five times the amount determined by the aforementioned methods. This represents a significant breakthrough in the 2020 legal amendment, providing a powerful tool for combating malicious infringement. Additionally, on April 26,2026, the Supreme People's Court issued the "Interpretation of the Supreme People's Court on the Application of Punitive Damages in Civil Disputes Involving Intellectual Property Rights Infringement," offering more specific regulatory guidance for the application of punitive damages.

(II) Relevant Judicial Interpretations

The Interpretation of the Supreme People's Court on Several Issues Concerning the Application of Law in the Trial of Civil Disputes over Copyright (Fa Shi [2002] No.31) provides detailed provisions on the calculation methods for actual losses and illegal gains, explicitly stating that reasonable expenses—including attorney fees, notarization fees, and investigation and evidence collection costs—may be included in compensation.

The Interpretation of the Supreme People's Court on the Application of Punitive Damages in Civil Cases Involving Intellectual Property Rights Infringement (Fa Shi [2026] No.7) clarifies the applicable conditions for punitive damages, including the criteria for determining "intentional" misconduct and "serious circumstances," specific scenarios, as well as methods for determining the compensation base amount and multiplier.

(3) Supplementary Application of the Anti-Unfair Competition Law of the People's Republic of China

In game infringement disputes, the Copyright Law and the Anti-Unfair Competition Law are often applied concurrently. When an infringement also constitutes unfair competition (e.g., free-riding or confusion practices), the rights holder may claim compensation under the Anti-Unfair Competition Law; however, courts typically avoid double counting of damages.

(4) The Tort Liability Chapter of the Civil Code of the People's Republic of China

Article 1185 of the Civil Code of the People's Republic of China, which establishes the principle of punitive damages for intellectual property rights violations, provides further legal basis for compensating copyright infringement in gaming contexts.

III. Factors Considered in Determining the Amount of Compensation

The legal basis serves as the guiding principle for courts in adjudicating cases; however, the greater challenge in judicial practice often lies in aligning factual findings with legal provisions while ensuring compliance with the principle of "fact-based determination." Below are the key factors that courts typically consider comprehensively when determining compensation for game copyright infringement, as summarized by the author based on practical experience:

(I) Factors Related to Infringement Acts

Nature and manner of infringement: whether it involves complete replication (e.g., private servers), substantial similarity (e.g., games with ed packaging), or partial element copying (e.g., visual assets, music, or storyline). Compensation for complete replication is generally higher than that for partial element infringement.

Scope and scale of infringement: distribution range, download volume, number of registered users, number of active users, covered platforms, and geographical areas of infringing games.

Infringement duration: The period from the release of the infringing game until infringement cessation. A longer duration typically results in higher compensation amounts.

The degree of the infringer's subjective fault: whether they were aware or should have been aware of the infringement yet proceeded with it; whether they continued the infringement after receiving a warning letter or legal action; and whether there was any malicious attempt to evade liability.

(II) Factors Related to Copyrighted Works

Reputation and market value of copyrighted works: When a well-known IP is infringed, compensation amounts are typically higher. Courts consider factors such as the work's market influence, brand value, and user base.

The creative investment required for a work—including the R&D costs, development timeline, and team size of an original game—reflects the intellectual and financial contributions made by the rights holder.

Work Type and Degree of Originality: As a composite work, a game may encompass various copyright subjects—including computer software, artistic works, musical compositions, literary works (plot), and audiovisual works. The higher the degree of originality, the stronger the level of protection.

(III) Factors Related to Economic Data

Revenue data for infringing games: including top-up transactions, advertising revenue, and item sales revenue. These are the core figures for calculating illegal profits.

Loss data of rights holders: including user attrition, revenue decline, and market share reduction caused by infringement.

License fee reference: The standard licensing fees for similar games can serve as a benchmark for compensation amounts.

Game industry profit margin: Used to estimate actual profits from revenue data, typically referencing the industry average profit margin or specific company financial figures.

(IV) Other Consideration Factors

Legitimate expenses for rights protection: including attorney fees, notarization fees, investigation and evidence collection fees, appraisal fees, travel expenses, etc.

The scale of the infringer's business operations and its solvency: Although not a statutory consideration, these factors may influence judicial discretion in practice.

Industry Practices and Market Environment: Business models, revenue streams, competitive landscape, and more within the gaming industry.

4、Investigation of compensation-related factors and acquisition of evidence

The evidence materials pertaining to both compensable factors and determinants of compensation awards, as well as those effectively obtained through organized efforts, constitute a crucial component in case adjudication. Below, the author briefly outlines the investigation of compensable factors and evidence acquisition procedures:

(1) Documentation of Infringement Acts and Evidence Preservation

Notarized evidence collection: The notary office certifies actions such as downloading, installing, running, taking screenshots, or recording screen activities of infringing games to establish infringement facts. This constitutes the most fundamental and crucial method for gathering evidence in game copyright infringement cases.

Time戳 evidence: Use a trusted timestamp service to secure electronic evidence, ensuring its authenticity and integrity.

Pre-litigation evidence preservation: In emergency situations, you may apply to the court for pre-litigation evidence preservation to secure critical evidence such as server data and operational records of infringing games.

(II) Investigation of profits derived from infringement

Public data from app stores: Collect publicly available information—including download counts, ratings, and rankings—of infringing games from platforms such as the App Store, Google Play, and major Android app stores.

Third-party data platforms: Utilize third-party analytics platforms such as Qimai, App Annie (data.ai), and Gamma Data to obtain estimates of download volumes, revenue, user engagement, and other metrics for infringing games.

Business registration and financial data: Obtain the infringer's business registration details, shareholder information, and affiliated companies through platforms such as Qichacha and Tianyancha; request court-issued investigation orders or apply to courts for access to the infringer's financial statements, tax records, bank transactions, etc.

Industry Reports and Market Data: Refer to industry reports released by institutions such as the China Audio-Video Industry Association Game Working Committee (GPC) and Gamma Data as references for estimating industry profit margins and market size.

Application to the court for ordering the provision of evidence: According to the "Several Provisions of the Supreme People's Court on Evidence in Civil Litigation Concerning Intellectual Property Rights," when the right holder has made reasonable efforts to provide evidence, an application may be filed with the court to order the infringer to submit accounting books, documents, and other materials in their possession that are related to the profits derived from the infringement. If the infringer refuses to provide such materials without justified reason, the court may determine the amount of compensation by referring to the right holder's claims and evidence.

(3) Proof of losses incurred by the rights holder

Self-operational data comparison: Provides data on revenue changes, user growth rate changes, market share changes, etc., before and after the infringement occurred, to demonstrate causality.

Market Research Report: Commission a professional agency to conduct market research and assess the impact of infringement on the rights holder's market share and brand value.

Evidence of licensing fees: Provide the previously signed game licensing agreement with a third party to demonstrate the market price of the licensing fees.

(4) Professional Appraisal and Evaluation

Judicial appraisal: Commission a qualified judicial appraisal institution to conduct technical analysis of the game's substantial similarity, including source code comparison, visual asset comparison, and gameplay rule comparison.

Asset valuation: Engage a professional asset appraisal firm to assess the market value of the game's copyright and the losses resulting from infringement.

Expert Assistant: Engage a gaming industry expert or intellectual property specialist as an expert assistant to testify in court, providing opinions on professional matters such as the game's technical features, market value, and industry practices.

5、typical case

Below is a brief analysis of two cases for reference, providing insights  classic judicial precedents and court practices regarding copyright infringement in the gaming industry.

Case 1: Pokémon Copyright Infringement Case

Case Summary: The Pokemon Company has sued Guangzhou Maichi Network Technology Co., Ltd., Horgos Fangchi Network Technology Co., Ltd., and others, alleging that their mobile game Pokémon: Remaster infringes the copyright of the Pokémon franchise and constitutes unfair competition. The plaintiff is seeking compensation of RMB 500 million.

Judgment outcome: The Guangdong Provincial Higher People's Court ruled in the first instance that the defendant shall compensate RMB 107 million (approximately US$14.7 million). During the second-instance proceedings, the parties reached a mediation agreement.

Case Analysis: This case is one of the cases with the highest compensation amounts in the field of game copyright infringement in China, reflecting a significant enhancement in the Chinese courts' commitment to protecting game intellectual property rights. When determining the compensation amount, the court comprehensively considered factors such as the global recognition of the Pokémon brand, the operational scale and profitability of the infringing game, and the degree of malice behind the infringement.

Case 2: NetEase sues Mini Play for copyright infringement of "Minecraft" in the game "Mini World".

Case Summary: As the regional operator of Minecraft in China, NetEase sued Mini World Technology Co., Ltd. (Shenzhen-based) for copyright infringement and unfair competition, alleging that the two games exhibit striking visual similarity.

Judgment outcome: The court ordered Mini Play to cease the infringing activities and pay NetEase compensation of RMB 50 million.

Case Significance: This case addresses the boundaries of copyright protection for the specific category of "sandbox games." The court conducted an in-depth analysis of copyright protection for the game's overall visual design, establishing that even within the same game genre, substantial similarity in artistic expression still constitutes infringement.

6、dynamic analysis

Based on the author's analysis of relevant cases and industry observations, game-related infringement cases currently exhibit the following characteristics:

(1) The amount of compensation for infringement is showing an upward trend.

Relevant cases demonstrate that the compensation amounts for copyright infringement in China's gaming industry have shown an upward trend: ranging from several hundred thousand to several million yuan in early stages, the compensation amounts in landmark cases in recent years have reached tens of millions or even hundreds of millions of yuan. Following the amendment of the Copyright Law in 2020, the statutory upper limit for compensation was raised from 500,000 yuan to 5 million yuan, and the introduction of punitive damages has provided a legal basis for substantial compensations.

(2) The shift from "statutory compensation as the primary approach" to "precise calculation"

In early copyright infringement cases, courts frequently relied on statutory damages due to evidentiary challenges, resulting in generally low compensation amounts that failed to serve an effective deterrent purpose. In recent years, however, compensation calculations have become more refined following several developments: courts have implemented stricter allocation of the burden of proof, while this shift has also imposed higher demands on copyright holders in asserting their rights.

（3）The determination of game copyright infringement remains controversial.

Game infringement encompasses a wide and complex range of scenarios involving diverse content types, with courts still debating certain aspects—including compensation determinations for "skin-changing games," infringement liabilities in game livestreams and short videos, cross-border infringement issues, and copyright damages for AI-generated game content. Given the complexity of these topics, this article will not delve  each detail; readers are encouraged to follow my subsequent analyses on these matters.

7、Conclusion and Recommendations

The determination of compensation amounts for game copyright infringement constitutes a complex issue involving multiple dimensions such as legal application, factual determination, and economic analysis. While ongoing improvements in judicial practice and regulatory frameworks have effectively safeguarded the healthy development of the gaming industry, the field of game copyright infringement compensation still faces numerous challenges: significant evidentiary difficulties, inconsistent compensation calculation standards, and inadequate rules for identifying infringements in emerging business models. Based on personal practical experience, the author offers the following recommendations for rights holders and alleged infringers:

(1) Suggestions for the rights holder

Enhance copyright registration and evidence retention: promptly register copyrights for game software, artistic works, etc., and establish a comprehensive evidence chain covering the entire creative process (including design documents, development logs, version iteration records, etc.).

Establish an infringement monitoring mechanism: utilize technical means and third-party services to conduct continuous surveillance of major app stores and gaming platforms, enabling timely detection of infringement activities.

Prioritize the collection of infringement evidence: Upon identifying an infringement, immediately secure relevant evidence through notarization or timestamping, while also gathering economic data such as download volumes, revenue figures, and user reviews of the infringing game.

Rational ion of compensation calculation methods: Based on the specific circumstances of the case, choose the most appropriate method for calculating compensation. If it can be proven that the infringer has obtained substantial profits, prioritize claiming illegal gains; if the personal losses are clearly defined, claim actual losses.

Advocate punitive damages vigorously: For cases involving intentional infringement with severe circumstances, actively gather evidence to claim punitive damages and maximize the compensation amount.

(II) Recommendations for the alleged infringer

Compliance review during development: Establish an intellectual property compliance review mechanism throughout the game development process to prevent unintentional infringement.

Timely cessation of infringing activities: Upon receiving a infringement warning or legal action, promptly assess the risk of infringement and proactively cease the infringing activities when necessary to reduce compensation amounts and avoid the imposition of punitive damages.

Active evidence-based defense: Present evidence of independent creation and evidence from legitimate sources to effectively counter infringement allegations.