AimJunkies Maintain That Cheating is Legal, Appeals Bungie’s $4.3 Million Arbitration Award

Two years ago, Bungie filed a complaint at a federal court in Seattle, accusing AimJunkies.com of copyright and trademark infringement, among other things.

The same accusations were also made against Phoenix Digital Group, the operating company behind the website, and third-party developer James May.

AimJunkies denied the claims and argued that cheating isn’t against the law. In addition, it refuted the copyright infringement allegations; these lacked substance because some of the referenced copyrights were registered well after the cheats were first made available, AimJunkies said.

AimJunkies Strikes First

Last year, U.S. District Court Judge Thomas Zilly handed an early and partial win to AimJunkies. The original complaint didn’t provide sufficient evidence for a plausible claim that the ‘Destiny 2 Hacks’ infringed any copyrights, the Judge concluded.

This was a setback for Bungie, but the court allowed the game developer to amend its complaint, which it promptly did. As a result, the copyright infringement dispute is currently ongoing and progressing to trial.

During 2022, Judge Zilly also referred several of the non-copyright-related complaints to arbitration, including allegations that AimJunkies’ cheats violated the DMCA’s anti-circumvention provision and were illegally sold to third parties.

Bungie Wins Arbitration ‘Battle’

The arbitration process was conducted behind the scenes and resulted in a resounding win for the game developer; Bungie was awarded a total of nearly $4.4 million in damages and fees.

The bulk of the award was DMCA-related damages. According to arbitration Judge Ronald Cox, the evidence made it clear that AimJunkies and third-party developer James May bypassed Bungie’s technical protection measures in violation of the DMCA.

In addition to breaching the DMCA’s anti-circumvention provisions, the defendants were also found liable for trafficking in circumvention devices. Or, put differently, selling and shipping the cheats.

AimJunkies Files ‘Arbitration’ Appeal

The AimJunkies defendants were disappointed in the arbitration outcome and decided to challenge it at the Court of Appeals. In an opening brief, filed this week, they maintain that no law forbids cheating in computer games.

Bungie has repeatedly stressed that cheaters are not tolerated as they ruin the pleasure of honest players, which ultimately hurts sales of games such as Destiny 2. However, AimJunkies sees things differently.

“[I]n order for companies such as Bungie to obtain legal relief for any such ‘cheating,’ they, as with any litigant, need to demonstrate violation of an actual law or statute, such as patent or copyright laws, rather than simply shout, ‘Cheaters’ and hope the pejorative alone will be sufficient to establish liability,” the brief reads.

Bungie previously won several lawsuits against cheaters, either by default or through confidential settlements, but AimJunkies assigns little value to these achievements. According to the cheat seller, it’s first to take a stand and fight the issue on the merits.

“To the best of Appellants’ knowledge, they are the first actually to stand up to Bungie and seek a decision on the merits as to whether ‘cheating’ in computer games is unlawful in the absence of an actual violation of a recognized and existing intellectual property right, such a patents and copyrights,” they write.

Uncontested Witness Credibility

These musings mostly serve an introductory purpose. At the heart of the appeal is the question of whether the arbitration process was fair and correct; Aimjunkies believes it was not.

In concluding that Aimjunkies violated the DMCA by circumventing Destiny 2’s technical protection measures, the arbitrator largely relied on testimony from Bungie’s witness Dr. Kaiser. However, the appellants believe that the entire process was one-sided and erroneous.

A key aspect is that Dr. Kaiser, who was the only witness during the arbitration, was protected from a detailed and elaborate cross-examination. This meant that AimJunkies’ attorney couldn’t reveal any inconsistencies or weaknesses in the arguments that were made.

“[A]s Dr. Kaiser was the only witness offered by Bungie to support its claims that the ‘cheat’ software distributed by Phoenix Digital circumvented technological measures used by Bungie, the entire Final Arbitration Award is based on Arbitrator Cox’s admitted wholesale acceptance of whatever Dr. Kaiser said.

“Again, Arbitrator Cox declined to permit cross-examination based on Dr. Kaiser’s earlier, and contradictory deposition testimony which goes to the very heart of the credibility issue.”

This is a clear error according to the appellants. The credibility of the witness was a key factor in the arbitration outcome, while the other side was denied the chance to properly challenge this credibility.

Arbitrator Bias

The appeal brief goes on to argue that the “excessive” $4.3 million damages award in favor of Bungie is yet more evidence that arbitrator Cox is biased.

AimJunkies stresses that, after Bungie sent a cease and desist letter in 2021, it removed the contested software from its platform. Until then, AimJunkies made roughly $43,000 from the product’s sales, just a fraction of the awarded damages.

As a result of this ruling, four people will effectively be rendered bankrupt, the opening brief states.

“Arbitrator Cox’s grossly excessive award, – over 100 times the maximum possible actual damage found by Bungie’s own damages expert and which will bankrupt the four individual Appellants if allowed to stand – demonstrates a clearly punitive intent on the part of Arbitrator Cox, far removed from any actual damage suffered by Bungie.

“It is further evidence of prejudice on the part of Arbitrator Cox, given that it rests largely on testimony that was never given and acceptance of arguments even Bungie itself never made,” the brief adds.

Battle Continues

The arguments presented above are just a fraction of the 44-page brief which ultimately concludes that Arbitrator Cox violated the JAMS arbitration rules.

AimJunkies believes that it didn’t receive the arbitration “service” it paid for and was entitled to receive. As such, the damages award should be reversed.

Before the Court of Appeal rules on the matter Bungie also has the chance to share its side of the story, so this battle is far from over. In addition, both parties continue to battle in federal court, preparing for the upcoming trial on the copyright infringement ‘cheating’ claims.

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A copy of the opening brief, filed by AimJunkies and the other appellants at the U.S. Court of Appeals for the Ninth Circuit, is available here (pdf)

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