NCSoft Corporation, et al. v. Bluehole Studio, Inc., et al.

12-cv-00172
January 9, 2012
Federal Court
2nd Circuit
United States District Court for the Southern District of New York

Having launched a criminal investigation and a civil litigation in the Republic of Korea, NCSoft Corporation and NC Interactive, Inc. (collectively, “NCSoft”) now bring their court battle against rival, Bluehole Studio, Inc. (“Bluehole”) and its U.S. subsidiary, En Masse Entertainment, Inc., to the Southern District of New York. NCSoft alleges that the founders of Bluehole Studio—former employees of NCSoft—took “copious amounts” of confidential and proprietary NCSoft information, computer software, hardware and artwork relating to a popular “massive multiplayer online role-playing game” (“MMORPG”), Lineage 3. NCSoft continues to state in its complaint that the former employees planned to create a competing product using the same work they did for developing Lineage 3 while at NCSoft.

In 2009 the former employees were convicted by a Korean criminal court for the theft of valuable trade secrets from NCSoft and the convictions were upheld in part by the appellate court. A year later, a Korean civil court held that the same employees misappropriated NCSoft’s trade secrets and awarded NCSoft damages in addition to an injunction preventing the employees and Bluehole from further using NCSoft’s trade secrets. On appeal, a Korean appellate court upheld the injunction but reversed on damages. Currently, the criminal convictions and civil judgment are pending on appeal before Korea’s highest court.

NCSoft and Bluehole’s court battle now crossed the seas into the U.S. since Bluehole announced plans to release in the spring of 2012 an English-language version of a 2011 Korean MMORPG, TERA, which was allegedly developed using NCSoft trade secrets, notwithstanding the injunction from the Korean civil court.

NCSoft is seeking a preliminary and permanent injunction to prevent Bluehole from launching TERA in the U.S. Alternatively, it seeks damages for the “substantial harm that such a launch will inevitable cause NCSoft.” NCSoft’s other claims in the complaint include copyright infringement, breach of confidence, unfair competition and unjust enrichment.

NC Interactive, Inc., NCSoft Corporation
Bluehole Studio, Inc., En Masse Entertainment, Inc.
Common Law (Restatement)