The lawsuit over "Dark and Darker," dubbed a dispute between domestic game companies, effectively concluded with an appeals ruling after four years. Ironmace, whose trade secret infringement was recognized at the first trial, saw the damages reduced on appeal from 8.5 billion won to 5.7 billion won. However, the appellate court expanded the scope of Ironmace's trade secret infringement. In the industry, the prevailing view is that this result is a "decision win" for Nexon.
On the 4th, the Civil Division 5-2 of the Seoul High Court, in the appeal of Nexon's lawsuit seeking an injunction against trade secret and copyright infringement, recognized a broader scope of trade secrets infringed by Ironmace than at the first trial. The court found that P3's program, source code, and build files were all identifiable trade secrets, and extended the protection period from two years at the first trial to two years and six months. However, it limited P3 materials' contribution to the development of Dark and Darker to 15% and calculated damages at 5.7 billion won.
As in the first trial, copyright infringement was not recognized. The court said, "The modes of expression of P3 and Dark and Darker are not substantially similar," and dismissed Nexon's claim. Nexon's appeal arguing that substantial copyright infringement should be recognized in addition to trade secrets was not accepted.
The lawsuit began in 2021 with an accusation that key personnel from Nexon's undisclosed project (P3) took internal materials to personal servers, founded Ironmace, and produced Dark and Darker. The defendant was Choi Juhyun, now the Ironmace CEO, who at the time served as P3 Head of Team. Nexon has claimed that about 2,700 build files and source code items were leaked.
In the appeal, both sides presented 3D modeling and demonstration videos as they battled in court. Nexon argued, "A considerable number of character models are identical, and the horizontal width of the door asset matches down to six decimal places," asserting asset use. Ironmace countered, "The implementation methods for lighting, monsters, and traps are completely different," stressing independent development. CEO Choi appeared in person at the final hearing and said, "We only wanted to create a medieval fantasy FPS genre," rebutting that the copyright infringement claim was unfounded.
After the first-instance ruling, Dark and Darker's business environment also wavered. The game was delisted from the global platform Epic Games, Inc. Store, and Krafton terminated its licensing agreement with Ironmace for the mobile version under development. The assessment is that partner risk management tightened as legal uncertainty dragged on. The financial situation also deteriorated quickly. In 2024, the operating loss was 1.8 billion won and the net loss was 5.7 billion won, swinging to a deficit from the previous year. The expansion of the expense burden as first-instance damages were recognized as a provision affected the results.
Ahead of the appeal, Ironmace carried out a reorganization separating management and development. Co-founder Director Choi Juhyun became CEO, and former CEO Park Seungha moved up to president. The company said it was for "global market response," but in the industry, some noted it was a reorganization for legal response.
Nexon sees this lawsuit not as a simple legal dispute but as a case that resets standards for development ethics and intellectual property protection in the game industry. In fact, upon detecting suspected leaks of materials related to another undisclosed project, "MX BLADE," Nexon has continued legal action against related startup game companies.
Industry watchers assess this ruling as "a case that comprehensively redefined the standards for developer job changes and startups, and for large companies' development security reinforcement." While copyright was denied at the second trial, the scope of development materials recognized as trade secrets expanded significantly, and the ripple effects on future talent mobility, spinoff startups, and data management systems are expected to be considerable.
A game industry official said, "In effect, this ruling gives large game companies strong grounds to enforce noncompete measures against departing employees," adding, "Developers will have to prove that their entire development process is unrelated to know-how and my creations obtained at their previous workplace, so the threshold for startups will become much higher both technically and legally."