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Epic Games has hit China-based augmented reality creator, Nreal with a lawsuit accusing it of infringing trademarks for branded software used to create 3D and immersive digital content.
The Maryland-based games maker filed the complaint at the US District Court for the Eastern District of North Carolina on May 14, holding that Nreal’s parent company, Shenzhen Tairuo Technology was liable for trademark infringement, false designation of origin, unfair competition, and refusal of registration.
According to the filing, the Chinese startup infringed the US company’s trademarks on its “Unreal Engine”, a creation platform used for immersive simulations by launching its ‘Nreal Light’ smart glasses.
Epic stated that over the last two decades, its “Unreal Engine” has become the “gold-standard engine and development tool for digital content”, enabling creators to deliver cutting edge content, interactive experiences, and immersive virtual worlds.
It added that the tool attracted more than 11 million users and that hundreds of millions of people enjoy experiences, including virtual reality games and simulations.
Nreal’s allegedly infringing product concerns glasses that project virtual 3D images into the user’s real physical environment and allow people to interact with a range of virtual reality software applications, including video games.
Nreal was formed in 2017 in China and the filing holds that according to its founder, Nreal’s goal is to bring mixed reality “applications to as many people as possible by developing a product [it] could offer at a lower price.”
Nreal fixed its sights on the US last year, when it began pre-launch marketing at the Consumer Electronics Show, according to the suit.
The filing stated that Nreal has partnered with several major mobile communications providers in Europe and Asia, including Samsung, LG and Deutsche Telecom, and seems “poised to follow that same path” in the US.
In August 2020, Nreal began selling the disputed product to consumers in Korea, Japan and Germany and announced plans to launch in the US in the second quarter of 2021.
Nreal also posted on its Twitter page that it has “big news” and that “something you’ve all been waiting for is on its way,” signalling the product’s launch in the US and prompting Epic to sue.
The US games maker argued that according to its pending trademark application, Nreal intends to use the ‘Nreal’ mark in connection not just with mixed reality glasses that can be used with content created using Unreal Engine, but for “[d]esign and development of computer game software and virtual reality software”—thus positioning itself squarely as a direct competitor to Epic.
Epic Games claims it’s “no coincidence” that Nreal’s name “looks and sounds virtually identical” to Unreal’s branding.
“Nreal was and is well aware of Epic and its ‘Unreal’ marks. Nreal does not just sell glasses, it has already developed and sold a game to be used with those glasses. Nreal is willfully trading off Epic’s rights, causing confusion, and acting with callous disregard for Epic’s prior rights,” the filing stated.
It further argued that the Chinese company’s use of ‘Nreal’, in connection with products that overlap with Epic’s ‘Unreal’ branded products and services is likely to confuse consumers.
“Not only has Nreal aimed its first product at a segment into which Epic has already entered, Nreal’s plans include further encroachment on Epic’s rights,” argued the US company.
Epic filed to block Nreal’s trademark in 2018, and the companies subsequently attempted to negotiate a settlement. But Epic contends that despite ongoing discussions surrounding its concerns that Nreal’s use of NREAL will cause consumer confusion, Nreal has persisted in its efforts to use Nreal in connection with its products.
“Protracted settlement talks have been fruitless, and Epic has no choice but to file this lawsuit,” it said.
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Epic Games, AR, Nreal, Trademarks, smart glasses, 3D, Samsung, LG