Dark and Darker, a game released by Ironmace, a studio founded by former Nexon employees, was found to have infringed on Nexon's trade secrets. Ironmace must compensate Nexon for its damages. Nexon claimed the game infringed its copyright, but the court did not accept that.
The Supreme Court's Second Division (presiding Justice Park Young-jae) on the 30th affirmed a lower court ruling that reached this conclusion in the final appeal of Nexon Korea's lawsuit seeking to ban trade secret and copyright infringement against Ironmace and Chief Executive Choi Ju-hyun, among others. Ironmace, Choi, and others must pay Nexon 5.76464 billion won in damages.
Choi previously worked at Nexon's new development department as Head of Team for "Project P3." Choi leaked game development materials and encouraged team members to change jobs, leading to dismissal from Nexon. Choi then founded Ironmace with A, who had worked as a team part leader on the same team, and developed and released Dark and Darker.
Nexon filed suit in 2021, saying Choi leaked unreleased game source code and data and used the siphoned materials to make Dark and Darker.
In the first trial, the court ruled that Ironmace leaked information such as the P3 components and their combinations, thereby infringing Nexon's trade secrets, and ordered 8.5 billion won in damages. However, it did not recognize copyright infringement, finding no substantial similarity between Dark and Darker and Nexon's P3 game as of June 2021.
The appellate court also recognized Ironmace's trade secret infringement against Nexon. However, considering the actual extent of the damage, it reduced the award to 5.76 billion won. As in the first trial, Nexon's copyright infringement claim was not accepted.
Specifically, the appellate panel said, "Comparing the 'June 30, 2021 P3 game' implemented as of Choi's resignation with Dark and Darker, differences exist in individual components as well as in the organic combination of elements due to the difference in game genres, so substantial similarity is not recognized," and it rejected Nexon's copyright infringement claim.
In detail, the appellate court found that the P3 game's source code, graphic resources, and game design documents obtained by Choi and others were identified as trade secrets as an integrated whole organically combined for a single game. It further found trade secret infringement, taking into account Choi and others' confidentiality obligations, the time gap up to the preparation to establish Ironmace, and the game development period.
On the copyright infringement claim, the appellate court pointed out that the game genres differ. It noted that P3 is a "battle royale genre" in which multiple players fight until only one remains within a single game, with no concept of mid-match extraction before the game ends. It also noted that items acquired during gameplay all disappear after the match.
By contrast, it found that Dark and Darker has a decisive difference from P3 because multiple players fight each other in-game but can extract mid-match. The game's objective is item acquisition, and if a player survives and extracts safely without dying in-game, the items remain with the player.
The appellate court said, "Because of these genre differences, terrain and monster placement and level design differ, and the organic combination of game components also inevitably differs."
Both Nexon and Ironmace appealed, but the Supreme Court dismissed the appeals, finding no error in the lower court's judgment.
A Supreme Court official said, "This ruling is a case that analyzed in depth the components including game genre and, based on that, determined whether there was copyright infringement between games."
The official added, "The game industry sees frequent job changes, and it is not uncommon to establish a startup right after leaving a company, so trade secret disputes are frequent," and said, "This ruling is significant in that it presents criteria for identifying trade secrets, secrecy, and determining acts of trade secret infringement in similar cases within the game industry."