Cheating is as old as the first rule-based competition and probably dates back to some Old-Greek or prehistoric time.

Cheating in video games has an ambiguous tradition, ranging from developer-promoted cheat codes in game manuals to a multi-billion industry of third-party cheat software created through the demand of online players’ need for that win. It is likely impossible to prevent someone from cheating, but it seems that some studios are finding a way of preventing cheaters from accessing their cheat tools by suing the makers of cheat software.

In this article, we will delve into Bungie's recent lawsuits against cheat makers to help understand why cheat software makers are often liable for their behavior, and the risks and benefits from these lawsuits for players, game developers, and the cheat manufacturers themselves.

In April 2021, the Destiny developer successfully settled a case for $2 million against GatorCheats and settled a lawsuit against another cheat developer for $13.5 million in June 2022. Two recent cases brought by Bungie cement the studio’s status as a pioneer in the legal battle against cheat manufacturers:

• Bungie v. VeteranCheats (from 2021-2023): Bungie secured a legal victory over a Destiny 2 cheat maker, ordering payment of over $12 million.
• Bungie v. Aimjunkies (ongoing): Bungie similarly sued a Destiny 2 cheat maker (Phoenix Digital), ending with a settlement of over $4.3 million in damages and attorneys' fees. The settlement order remains in dispute as of the publication date of this article. Further, it appears the last word has not been spoken here as well as here.

Is There a Law Against Cheating or Cheat Software?

Cheating (in sports, video games, or other competition) is not illegal per se under federal and state law. There is no video game statutory law that says a cheater is a bad person and that because he cheated, he must go to jail. Hence, the studios get creative. The commonly made claims by the studios against the third-party cheat software makers typically include:

• Copyright infringement: modification or reverse-engineering of the game’s assets as is necessary to develop the cheat software, but without a license.
• Trademark infringement: unauthorized use of the branding or “marks” held by the game-maker, which cheat makers tend to need to market their cheats.
• Breach of contract/tortious interference with a contract: behavior contrary to the terms in the developer’s licensing agreement. The cheat maker will have to download and buy the game to access the code and the software for their development of their cheat software.
• State consumer protection laws: In the U.S., each state has its own laws meant to prevent businesses from using deceptive or unethical practices in selling their goods, like Washington’s state consumer protection laws in the Bungie cases.

Specifically, Aimjunkies argued that Bungie should be held liable for obtaining information about the cheat software from Aimjunkies’s computers and then surveilling the operations without consent, essentially saying Bungie had to download the cheat software and by “hacking” the cheat violated the cheat maker’s terms. Further, Bungie could show that Aimjunkies was attempting to evade detection by Bungie “such as [by] deleting any mention on their website of Destiny 2 and adding the word “Destiny” to their website’s profanity filter.” Aimjunkies thereby deliberately concealed operations and marketing of the cheat from the developer itself.

Some Takeaways for Players, Studios and Software Developers

Players that use third-party cheat software will likely not see studios threatening legal action against them because it is simply uneconomical to pursue one or all cheating players if you can go after the gatekeeper. Not only is the effort tedious, but also the sums that a studio can recover are tiny in comparison.

Regardless, studios likely have a contractual claim against players because their use of cheat software in most cases violates the EULA and the Terms of Service. Studios leverage their rights from the EULA and the Terms of Service and push cheating players to forfeit the price of the game and any in-game purchases without legal recourse. Studios further leverage these rights for community-based enforcement measures like public shaming or lengthy in-game bans to make it more difficult for players to recommit cheating offenses. To combat cheating, Battlestate Games (Escape From Tarkov) encouraged its playerbase to continue “reporting the bastards,” further stressing the importance of playing fair. Such calls for action seem to have led to mass bans. Sometimes studios choose a less impactful route and request from banned players a homework assignment to reclaim their accounts; one developer required cheaters to submit an apology essay on the damaging effects of cheating.

Lastly, players that use cheat software have to be specifically aware that they may find themselves caught up in legal action against the cheat maker. A court could determine that players' download and usage data of the cheat software proves valuable for the legal proceeding. This includes seizure of personal data of or evidence of payments made by the player to access the cheats. In California, a court approved Jagex’s request to obtain the personal information of users who used cheats in RuneScape. The cheat users’ information was acquired even when housed on a third-party website like YouTube.

Developers should take these victories as a success against the rising number of cheat makers, though this is not without costs. Game devs will need to continue spending thousands and perhaps millions of dollars on robust anti-cheat systems, depending on the size of the playerbase. Bungie itself alleges over $2 million spent to combat cheaters. But legal proceedings take time and money, and studios of popular multiplayer titles are forced to implement cheat detection software ASAP, either in-house or via third parties like BattlEye, to hold cheat makers accountable without or before filing a lawsuit.

Aside from technical measures, developers will have to set the grounds for legal battle with the terms they provide for in their EULA and Terms of Service. In particular because these terms provide the rules for download and use of the code, which the cheat software requires for development. Most EULAs therefore include a ban of reverse-engineering game software, and some specifically address using cheats in online settings. For example, Bungie’s LSLA prohibited players who “[h]ack or modify Destiny 2, or create, develop, modify, distribute, or use any unauthorized software programs to gain advantage in any online or multiplayer game modes.” Studios should consistently vet and update their EULAs to ensure that they prohibit any modification of game software without the developer’s permission.

Cheat software manufacturers run a precarious business model, given the costs incurred by litigation for infringement (and the ability of larger developers to foot the bill for these lawsuits). It will be difficult to convince a court that making and selling cheats does not infringe upon a studio’s intellectual property and commercial rights in some manner. Large payouts to studios are likely to persist for willful and large-scale infringement by cheat developers. Even for games where lawsuits were not previously explored (i.e., because the developer may not have had the financial means to sue or cheating was handled with non-legal alternatives), some devs may want to emulate the success of companies like Bungie. This will be especially true if courts continue to order the cheat makers to pay for the developers' costs to bring the lawsuit itself, which amounted to over $735,000 in the Aimjunkies case and $215,000 in the VeteranCheats case. As seen in the past, perhaps smaller devs will take the hint from companies like Bungie, Ubisoft, and Riot Games to join forces against cheat makers in a single bout of litigation against a common enemy.

Furthermore, if a cheat maker is caught, their corporate records may be required to be turned over to determine how much money the cheat software brought in. Destroying evidence or refusing to comply with the terms of discovery could lead to additional monetary costs. For example, in May 2023, the court ordered Aimjunkies to turn over its Bitcoin wallet, and earlier, subpoenaed PayPal to turn over customer records for those ordering the cheats. In a 2018 court case in Australia, Rockstar Games (Grand Theft Auto, Red Dead Redemption) was able to obtain a legal order to search the work and homes of cheat developers.

If there’s one takeaway from Bungie’s recent lawsuits, it’s that cheaters will cheat but that developers have tools to take them on; some more costly than others.

Author: Matthew Vernace

Released: November 8, 2023

Dutch consumers are suing Sony over the argument that Sony controls about 80% of the console market in the Netherlands and abuses its dominant market position.

Ultimately, the Dutch consumer group Stichting Massaschade & Consument, representing 1.7 million Dutch Playstation users, makes the same claim that the regulators are making against dominant tech platforms like Apple and Google, who wield market abusive, and likely illegal, powers over digital ecosystems.

Uniquely here, the case represents the consumer’s fight for fairness following the February launch of the “Fair PlayStation” campaign that criticizes the “Sony tax” where digital games are allegedly priced up to 47% higher despite lower distribution costs. The lawsuits, if successful, could not only force Sony to compensate affected users, it would also open Sony to third party game stores and prove a vital cornerstone in the developer’s fight for market access against big corporations.

What Happened?
Sony’s digital ecosystem is closed by design: PlayStation users can only purchase games and add-ons through the official PlayStation Store, while third-party resellers like Amazon or Green Man Gaming are completely excluded. This gives Sony complete control over pricing and distribution, along with a standard 30% commission on all digital sales.

This setup results in limited consumer choice and higher prices - commonly referred to as the “Sony Tax.” While physical PlayStation games remain available through retailers with competitive pricing, the same is not true for digital content. Sony sells two PS5 models: a Standard Edition with a disc drive and a Digital Edition without one. Owners of the Digital Edition are fully locked into Sony’s digital-only ecosystem. Additionally, since 2019, Sony has banned third-party sales of digital game codes, preventing developers from offering their games directly or through alternative platforms.

What This Means for Game Developers?
Sony’s digital policies tightly restrict how developers can price, promote, and distribute their games. Independent discounts, regional pricing, and time-limited promotions all require Sony’s approval, while selling digital codes through developers’ own websites or third-party platforms is prohibited - practices common on PC and Xbox.

This creates a single point of access - the PlayStation store - where visibility and revenue opportunities are tightly controlled. Placement depends entirely on Sony’s algorithm and editorial discretion - a barrier for many indie and mid-sized studios. With no option to drive external traffic or leverage affiliate marketing, discoverability becomes yet another gate that only Sony can open.

This lack of alternative sales channels leaves developers fully exposed to Sony’s standard 30% commission, with no way to offset it through direct sales or discounted offers, limiting both pricing flexibility and growth potential compared to other platforms.

Is the “Walled Garden” and “Sony Tax” illegal?
Under EU competition law, companies with a dominant market position are strictly prohibited from abusing that power to the detriment of consumers or competition. The key legal provision is Article 102 of the Treaty on the Functioning of the European Union (TFEU), which bans abusive practices such as excessive pricing and unfair trading conditions. Dutch law reflects this through Article 24 of the Dutch Competition Act, which mirrors the principles of Article 102.

Legally, the Dutch Consumer Foundation argues that Sony controls about 80% of the console market in the Netherlands and has abused this dominant position by restricting developers and resellers from offering digital PlayStation games outside the PlayStation Store. They claim this has created an artificially closed market that inflates prices and harms consumer choice. According to their research, digital PlayStation games can cost up to 47% more than physical copies.

If upheld in court, this pricing model could be considered excessive pricing under Article 102 TFEU - a form of exploitative abuse - particularly if Sony’s digital prices are found to significantly exceed what would be expected in a competitive market.

Beyond Article 102, the EU’s Digital Markets Act (DMA), which came into effect in 2023, introduces new rules targeting large online platforms classified as “gatekeepers,” including Sony’s PlayStation Store. The DMA mandates fair and transparent pricing, prohibits self-preferential treatment, and aims to foster cross-border competition within the EU’s digital single market. This legislation enhances regulatory oversight and restricts the kind of closed ecosystem Sony has built around digital game sales.

What’s Next?
The first court hearing is expected later this year, beginning with the Dutch court assessing whether it has jurisdiction and whether the consumer foundation can represent the class. Cases like this can take several years to resolve, especially if appeals follow an initial ruling.

If the court ultimately grants the claims, the foundation expects that Sony could be required not only to open its platform to third-party digital game sellers, but also to compensate millions of Dutch consumers for alleged overcharges. A ruling in favor of the plaintiffs could also set a legal precedent for similar lawsuits in other EU countries, putting further pressure on Sony - and possibly other platform operators - to reform their digital distribution models.

While Sony is battling similar cases also in England and Portugal, this case arrives at a moment of mounting political will to rein in digital gatekeepers. With laws like the EU’s Digital Markets Act (DMA) already targeting tech giants like Apple and Google, Sony may now find itself drawn into a broader regulatory push for platform accountability and consumer and game developer choice. Whether driven by regulators or consumers, the message is becoming clear: the era of closed ecosystems is under challenge.

In 2024, the total value of mergers and acquisitions was approximately $1.7 trillion US dollars. It is an undeniable fact that mergers and acquisitions bring in economic benefits.

As such, whenever there is a change of administration, interested parties are on the lookout to see how mergers and acquisitions will be impacted by the new administration. Therefore, the question is whether mergers and acquisitions will be affected under the new Trump administration.

Historical Context

During Trump’s first term (2017–2021), his approach to mergers and acquisitions (M&A) shifted from pro-business and lightly regulated to stricter enforcement, with 2020 seeing more merger challenges than any year under the Obama administration. Trump’s interventions often seem to have reflected personal and political motives, such as opposing the AT&T–Time Warner merger, which was linked to CNN. Meanwhile, he supported Disney’s purchase of 21st Century Fox, owned by ally Rupert Murdoch.

After his 2024 reelection, many expected renewed deregulation and the repeal of Biden’s 2023 Merger Guidelines. Yet, nearly a year into his second term, those guidelines remain, and M&A activity has seen little growth, as evidenced by the 4,535 deals recorded between January and May 2025, similar to the previous year. Analysts attribute the slowdown to economic and policy instability, particularly shifting tariffs. However, the passage of the One Big Beautiful Bill Act (OBBBA) is expected to revive the M&A market.

Changes During the Current Administration

The OBBBA is expected to help the M&A market, especially in the energy, financial and industrial sectors. Furthermore, the OBBA reinstates a “100% bonus depreciation for certain assets, generous interest deductibility and, crucially, no new carried-interest curb. This should mean there are more tax shields, more debt capacity, and a relative valuation boost for asset-heavy U.S. companies.”

Advantages Under the One Big Beautiful Bill Act

The OBBBA includes a 100% bonus depreciation, which essentially means that if a buyer acquires a business with many fixed-assets, they may deduct much of the cost faster. This would improve the after-tax cash flow for the buyer.

Furthermore, the OBBBA now includes an enhanced business interest deduction of 30% of EBITDA. Previously, the business interest deduction was capped at 30% of EBIT. With the inclusion of depreciation and amortization, taxpayers will now be able to deduct more interest. Also, this would mean that there is a greater tax benefit from using debt in an acquisition.

Finally, the OBBBA also included changes to the Qualified Small Business Stock (QSBS) regulated under Section 1202 of the Internal Revenue Code. C Corporations with less than $50 million of gross assets have historically qualified for this benefit. Under the OBBBA, the gross asset cap has been increased to $75 million, making more businesses eligible. Previously, taxpayers could exclude $10 million in gains, now that number has increased to $15 million.

Risks

The OBBBA notably addressed the international corporate tax regime, specifically the Base Erosion and Anti-Abuse Tax (BEAT). The countries that are subject to BEAT will see an increase of 0.5%, now paying 10.5% instead of 10%. Past drafts of the OBBBA, included the BEAT at 12% in the now discarded Section 899.

While the initial drafts of the OBBBA, specifically Section 899, included more tax increases for international corporations, this reflects an ongoing sentiment of promoting domestic growth at the sake of international corporations wishing to invest.

Practical Guidance

Any company considering a merger or acquisition of an American company must be aware of legislative changes that may occur within the Trump administration.

Anyone considering a merger must know that the provisions of the OBBBA favor acquisitions of business with fixed-assets and that the acquisitions be financed via debt. Opting for acquisitions in this way and those in Trump’s preferred sectors, are the best way to take advantage of the current administration’s stance on mergers and acquisitions.