[Author – Manu Abhishek Bhardwaj, a registered lawyer with the Bar Council of Delhi, completed B.A LL.B from University School of Law and Legal Studies, GGSIPU, Delhi and masters in Entertainment, Arts and Sports Law from the University of Miami; Manu is currently working independently and drafting Sports Contracts for Sports Agencies.]
The Gambling Scenario in eSports.
The world of eSports has made rapid high stride growth in recent years and seen itself become a multibillion-dollar industry within a short period of time. In the May of 2018, Supreme Court of the United States (SCOTUS) struck down the Professional and Amateur Sports Protection Act, unbanning commercial sports betting in most states, which opened the doors for legal betting in eSports as well. It is projected that by the end of 2020, eSports betting will become a $12.9 billion industry, generating over $1.8 billion annually in revenue, as per the market research firm Eilers & Krejcik Gaming. Betting on eSports is more or less identical to betting on traditional sports, with the caveat that the eSports betting product is far less developed than the traditional sports betting product. Gambling, like any competition, has become a part of fan’s experience in eSports.
The Skin Betting Issue
Skins are tokens such as guns, potions, swords, or other tools, that help players advance through the game more quickly and efficiently. Players typically gather skins during game play, but now they can purchase them on secondary markets. Typical skins sell for around $10.00, but particularly rare ones can sell for several hundred dollars. Skin betting is the Wild West of the gaming world as it does not put up actual money for grabs and exists in a grey area. Gamblers and betters just win and lose skins and do not trade in real money until they are sold in the secondary markets. There is a lack of regulatory authorities watching over the skin betting industry so the betting sites can be scams.
A vivid example of the legislation lagging behind the industry is the 2016 case against Valve, the developer of CSGO. Skins are cosmetic enhancements for in-game characters’ attire and weapons which players can exchange, buy and sell, as well as to bet with. To do that, gamers used their Steam accounts, and this platform is owned by Valve. The case claimed that the game developer created a digital currency in the form of skins, promoted unlawful gambling, including by minors, and profited from it. The case was unprecedented, and thus the plaintiffs simply didn’t find a RICO statute which could be applied to the case, so it was dismissed. Nevertheless, Valve discontinued the usage of Steam accounts by a few websites associated with skins gambling (interestingly, not because skins gambling is not legal but because of terms of service breach) and also updated its policy regarding in-game items usage. Following this latter step, a few more sites shut down, causing thousands of players to lose CSGO, PUBG and other game items worth of millions of dollars in total.
Issues with Match Fixing
Gambling and betting in eSports have opened the doors for organized criminals and low-level chancers to influence match outcomes and profit unlawfully. As the industry has developed, multiple scandals of match fixing have unfolded, embroiling some of the most prestigious gaming tournaments such as the 2016 Lee “Life” Seung-Hyun incident.
Since there is not an overall eSports governing body, it is very difficult to unite all the gaming organizations and leagues against match-fixing. Competition operators such as ESL have taken some steps in the direction by partnering with organizations such as eSports Integrity Commision (ESIC) trying to integrate fraud detections systems for spotting malicious activity. ESL further holds conferences to educate players and the industry about the risks associated with match fixing.
eSports has a bright future in the U.S. but faces a number of significant legal obstacles. Amongst the greatest threats to growth is continued match-fixing. Following the 1919 Black Sox scandal, there were fears that baseball would be irreparably harmed. Professional baseball responded by creating the Office of the Commissioner to protect the integrity of the game. eSports has attempted to implement some changes, but is still struggling to put a stop to its fixing problem. Until that happens, there will continue to be questions from those who look to have eSports classified alongside basketball, football, and baseball.
Drug Use in eSports
The average eSports athlete, or an e-athlete is much younger than the athletes in conventional forms of sports, and thus is more prone to issues such as drug abuse or gambling. Kory Friesen, known by his handle name “Semphis” in the world of Counter Strike Global Offensive, admitted to his team using Adderall, a stimulant commonly used to treat Attention Deficit Disorder, in a competitive Electronic Sports League (ESL) match in Poland. This came as a shock in the eSports world and resulted in ESL working with the National Anti-Doping Agency (NADA) and the World Anti-Doping Agency to institute a drug policy.
Effects of drug use on the industry:
- Health-Risk: High uses of drugs like Adderall can have long term drastic effects on the health of the young athletes as it leads to abnormal heart rate, elevated body temperatures and changes in blood pressure. A very high use can also result in the athlete ending up in coma. Eva Buntoff, the Director of Communications for NADA warned about the risk of addiction as well. According to the FDA, chronic Adderall use can lead to dependence. When the drug is overused, it has the potential for causing vomiting, hallucinations, and circulatory collapse. In extreme cases, the e-athletes might be indulging in other illegal substances such as cocaine to increase their in-game performances, which comes with very harmful health effects.
- Unfair Advantage: The Friesen incident prompted the ESL to begin conducting drug tests as a matter of policy as it gives players unfair advantages over their competitors who do not indulge in such performance enhancers. However, other major sport leagues and organizations have not followed suit and according to multiple claims, a huge number of e-athletes are on Adderall.
Most leagues do not fully prohibit, or test for, Adderall or similar substances. For example, the policy of Epic Games, which administers competitions for Fortnite, states, “Prescription drugs may be used only by the person they are prescribed to, and in the manner, combination, and quantity as prescribed.” It does outlaw the unauthorized use or possession of prescription drugs, as well as alcohol or illegal narcotics.
There is an argument by the gamers as to how Adderall does not make a player better and has no actual effect on the result of the outcome. However, both the WADA and US Anti-Doping Agency (USADA) consider Adderall to be a performance enhancer and thus it has been prohibited from all conventional major sport leagues such as NFL, MLB or NBA.
Challenges to organizations/ leagues
The ESL makes an exception in its policy and allows the use of Adderall on prescription, which is rather easy to obtain without having the actual disorder, which is raises a question as to how effective any measures against this form of doping would be. Another concern is the cost and difficulty to implement drug testing in these scenarios as many competitions are played online from the athlete’s house, making it realistically impossible to implement such testing. The ESL also spends about $40,000 per year on drug testing, which could be a substantial consideration for smaller tournament operators.
Another perspective is regarding as to where the line should be drawn because banning substances like Adderall could lead to a slippery slope when it comes to other products or substances like caffeine rich energy drinks which almost the e-athletes use on a day to day basis in large amounts.
An outright ban on ADHD drugs could harm players with valid prescriptions. But if organizers begin testing for Adderall but allow those with a prescription to use it, they risk encouraging players to seek a prescription illegitimately. Ignoring the issue completely may lead to competitors, fans and spectators questioning the integrity of eSports as a whole — not to mention any consequences surrounding the overlooked dangers posed to players through abuse of these drugs.
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PREFERRED CITATION – Manu Abhishek Bhardwaj, The Legal Issues with Drug and Gambling in the world of E-Sports, <https://sportslawandpolicyreviewreporter.com/2020/10/19/the-legal-issues-with-drug-and-gambling-in-the-world-of-e-sports/> October 19th, 2020.