Update: The Obey Alliance CEO has now responded on Twitter
In what could be a landmark case in Rainbow Six esports, the esports organisation of Pittsburgh Embers has taken legal action against its former Rainbow Six: Siege roster, as well as Obey Alliance for signing the players while still “under contract with the Pittsburgh Embers”.
The Embers were also briefly mired in a minor dispute with their graphics designer, Tony “Candor” Kecman, over about $45 in payments -- allegedly done late -- but the situation was eventually cleared up a while after he had asked for payment just prior to leaving.
Currently, Obey Alliance finds itself top of the North American Challenger League after its second play day, having beaten Parallax Gaming 2-0 (7-3, 7-3) on the first day and then Adventure Force 2-0 (7-4, 7-4) on the second day. However, it seems that the troubles for the roster, and possibly the organisation, are larger outside of the game than in it.
To understand why, here’s what happened, and when.
Timeline of Events
May 24th 2019: The Embers Announce Signing of Proximity Roster
The story started, of course, with the Pittsburgh Embers announcing their entry into the Rainbow Six: Siege esports scene with the signing of the Proximity roster. Sending out a press release on their website, it seemed that Cory “Kilo” Dawson, Pablo “Gryxr” Rebeil, Roman “Forrest” Breaux, Seth “Callout” Mik, and Joseph “Phozzo” Eisenmann were set to make the organisation their home for Season 10 of the Challenger League.
Of note, however, that while this announcement was made on the 24th of May, the contract only went into effect a week later, on the 31st of May. The contract was for two seasons (Seasons 10 and 11) included no salary for the Challenger League, an auto-renewal clause for an additional year, and a predetermined salary if the team achieved qualification to the Pro League. Also included was a clause that entitled the Embers to a whopping $5,000 in damages if a player retired while under contract -- an especially large figure given that the players would not be paid.
According to Embers owner, Ryan “Apple” Labriola, the team itself had approached the Embers for representation, themselves admitting that Challenger League teams could not justified being salaried and that was what they expected.
June 25th 2019: Phozzo Expresses Concerns About the Embers’ Past as Fibeon Esports
Over a month after, Phozzo (seemingly out of the blue) contacted Labriola out of concern about allegations that had been leveled at the Embers owner regarding his old organisation, Fibeon Esports.
Fibeon Esports was the former organisation owned by Labriola, and had held teams in H1Z1’s short lived esports league as well as the Rocket League Championship Series (RLCS). According to esports consultant Elle “LadyHardcore” Thibeau, the main issue had been with the RLCS roster, where one of the players’ salaries had been two months behind (at the time of her expose), while a further two players had not been paid for a month. Inquiries from players had been met with excuses or silence.
Furthermore, when Evil Geniuses had come knocking with an apparent $5,000 buyout for the team’s contract with one and a half months remaining, Labriola had allegedly demanded $10,000, then blocked the buyout and sent a notice to Evil Geniuses that Fibeon would be filing a legal claim against them. Not only that, he had barred the players from talking to Evil Geniuses (or any other organisation), something that was absent from the player contracts.
With this information having come to light for the players, Phozzo had wanted to know if Labriola’s new organisation, the Pittsburgh Embers, would be able to fulfill their contractual obligations. Points of discussion he had highlighted were jerseys being sent to the players, the validity of the Embers’ claims of having contact with sponsors, and of course the ability to pay the players.
Labriola had then sent over a redacted IRS 1099 tax form for Reed “Chicago” Wilen, Phozzo had apparently been placated and his concerns apparently put to rest.
July 17th 2019 - The Embers Finish Joint-Fifth in Major Qualifiers
It seemed that the Pittsburgh Embers were practicing well and seeing strong results, the first of which was a strong joint-fifth place finish in the Six Major Qualifier for North America -- the furthest a team from the upcoming Challenger League would go. Ahead of them were three Pro League teams -- Team SoloMid, Spacestation Gaming, and Luminosity Gaming -- as well as Leftovers, who would not qualify for the Challenger League.
July 29th 2019 - Candor Joins as Designer
After having left SiegeGG, Candor had decided to move onto new projects, starting with taking on the job of Lead Graphics Designer at the Pittsburgh Embers. He was immediately given work, and was a key component in a full overhaul of the graphics and branding of the Embers as well as a pitch deck. Eventually, he would ask for his payment just a few days before leaving on the 3rd of September, and would receive it "several days" after the 10th of September -- over a week after his departure.
August 5th 2019 - The Embers Qualify for the Challenger League
Following their qualifier performance for the Six Major Raleigh, the Pittsburgh Embers fairly comfortably achieved qualification to the Challenger League after having failed on the first attempt.
August 18th 2019 - Abunai Joins the Embers
Despite everything looking fine on the surface, the team was unhappy with their lineup. It didn’t take long after qualification to the Challenger League that the Embers announced a change, picking up Seth “Abunai” Pinkney for the main lineup. However, it is important to note that Abunai did not sign a contract with the organisation itself.
Leaving the team would be Kilo, with Forrest shedding light on the reasoning behind the change on Reddit:
Kilo is a great player but his current mindset is holding him back. We felt this roster change was necessary for the benefit of the entire team. … … Abunai has fit in well.
The next day, Kilo was formally released from the Embers, with his contract terminated.
August 21st 2019 - Players’ Agent TyTangles Spearheads Re-Negotiation
Displeased that the Embers were not making progress with sponsorships and the fact that jerseys had not been sent as promised, Phozzo and the other players enlisted the pro bono help of agent Chris “TyTangles” Heavin, founder of Omen Esports Agency. According to Labriola, however, the team “had a different idea as to what their valuation was” after qualifying for the Challenger League, felt “entitled to a renegotiation”, and “were looking for salary in Challenger League” -- the last in opposition to what they had apparently said when signing with the Embers.
Looking through the contract, TyTangles sent a message to Labriola, upon which the Embers owner responded with changes “to show good faith”. These changes included a removal of the auto-renewal clause, a reduction of the $5,000 retirement penalty to a still-sizeable $1,000, and an offer to increase the pre-negotiated salary for the Pro League. For his part, TyTangles felt the changes were fair, but made the obvious point that the team would have to agree.
The players, however, were not happy with the changes and held out for better negotiations. On the 27th of August, TyTangles and Labriola had a call for further discussions, during which Labriola apparently mentioned (whether in passing or as a point) that the contract was legally binding. With the players unsatisfied with the changes, Labriola, too, was not willing to budge any further and the two parties found themselves at an impasse.
September 2nd 2019 - Embers Roster Sends Notice of Intent to Leave
On the 2nd of September, 2019, the roster sent notice to Labriola that the players were “resigning” from the Embers and joining another (Obey Alliance), despite the contract apparently not allowing for unilateral termination. This came after the players cited the force majeure clause to suspend the contract due to “the owner’s past making [them] worried [they] would get scammed and frauded”.
A force majeure clause is a contract provision that relieves the parties from performing their contractual obligations when certain circumstances beyond their control arise, making performance inadvisable, commercially impracticable, illegal, or impossible.
According to Labriola, however, the clause was only there “so that the organisation can suspend obligations in the case of natural disaster (sic)”. While other force majeure events could be included in the clause, they apparently were not (and thus limited its coverage to natural disasters).
With the courts traditionally taking a very narrow view of such clauses -- that only the events listed and events similar to those listed will be covered -- it meant that Labriola likely had the law on his side. As such, he told the team that an event justifying the activation of the force majeure clause had not occurred and reminded the players that “they would be in breach of their agreements and [the Embers] would seek damages” if they left regardless.
Labriola had requested confirmation from the players by the end of the business day on the 3rd of September as to if the players would be breaking the contract, and received the resignation letters a day before the deadline, on the 2nd of September. The Embers thus responded by pointing out the lack of an allowance in the contract for unilateral termination, also informing the players that they would not be releasing their contractual obligations to the organisation and would be pursuing damages due to the breach.
The players, however, went ahead with the separation anyway, after apparently being advised by three different attorneys to resign with a formal letter. This came after Phozzo claimed that the team “felt unsafe” after finding out about Labriola's lack of payments to his Rocket League team, his attempt to sue Evil Geniuses, and the feeling that not being paid under an independent contract agreement (despite signing the contract as such) was tantamount to slavery.
September 3rd 2019 - Embers Staff Send out Press Release Regarding Ex-Players
On the 3rd of September 2019, the Pittsburgh Embers sent out a press release regarding their players after an hour-long staff meeting. In it, they said that the Embers would be pursuing “all action” to ensure the contract is enforced.
When pressed on what that meant, Labriola said, “I will only say that we are seeking damages against the players, well within our legal rights within our agreement. We tried to make this work with the team, but it is clear that their intention was to leave and sign with another organisation and we obviously cannot tolerate that.”
The full text of the press release is as follows:
The members of the Pittsburgh Embers R6 roster have provided notice as of September 2nd, 2019 of their intent to separate from the Pittsburgh Embers and join another esports organization. We want to make it clear that the initial term of our agreements with the players was for a period beginning on May 31st, 2019 and ending fourteen days after the completion of the Rainbow Six Pro League Season 11 or on May 31st, 2020, whichever occurred first, with automatic renewal for one additional year.
After the team’s recent success, the players approached us about revising their current agreements. The Pittsburgh Embers attempted to work with the players in good faith to make amendments to the agreements for the benefit of the players. It is important to note that we had no obligation to amend the agreements, but we still proposed changes to better support the players. Ultimately, the players chose to ignore the formal proposal for changes and opted instead to breach their agreements by separating from the organization without grounds.
In esports, as in other industries, contracts are negotiated based upon perceived value and opportunity at the time of negotiation. The players signed our contract offer after mutual agreement about the team’s current value with provisions to address future agreed upon value. We have upheld every clause to the letter within our agreements and we are saddened that a team of professional players is failing to do the same.
Although it is our hope that the players can continue their success in R6, we have placed the players on notice that we are not releasing their existing agreements. Our agreements are legally binding, and we will pursue all action to ensure that they are enforced. We appreciate all the support that has been provided to us by the R6 community in recent months and we are saddened that our fans will no longer have a team to support in the upcoming Challenger League. We owe it to you to hold the players accountable for their actions and we will continue to update you should we deem it necessary and appropriate.
September 26th 2019 - Players Sign with Obey Alliance, Embers Issues Legal Notice to Obey
On the 26th of September 2019, the former Embers players announced that they had signed with Obey Alliance and would be playing under this new banner from the next day onwards in Season 10 of the Challenger League.
In immediate response, the Pittsburgh Embers then apparently issued a "legal notice" to the CEO of Obey Alliance, Jonathan “ShooK” Ross, informing Obey that the players are under contract with the Pittsburgh Embers, and would also be found liable for damages if the players are not released. According to Labriola, Obey should have negotiated a buyout with the Embers directly, but had never contacted them. As of the 29th of September, there had been no response from Obey.
Update: The Obey Alliance CEO has now responded on Twitter
What Next for the Embers, the Players, and Obey?
As the magnitude of this civil case is likely not sizeable enough, and according to contract details, Labriola and the Embers need to compel the players involved to travel to Pennsylvania to contest the suit -- and are likely to be unable to force them to do so. As such, each state of residence for each of the players and Obey must consider the contract between the Embers and the players legally binding and the Embers must then file a lawsuit against each player in every relevant state.
As such, it is fairly likely that the damages the Embers seek will be outweighed by the cost of starting legal proceedings in each and every state, as well as the possible costs of travel to each state. It is also worth noting that since the state of Pennsylvania does not accomodate exclusivity clauses, Obey Alliance are well in the clear with the signing of the former Embers roster. Furthermore, as ShooK said on Twitter, four independent lawyers "laughed at [the situation]" on their side, making it clear that Obey does not see any potential lawsuit as a threat, and with the added revelation that no actual legal notice from a lawyer had been sent out, it is unlikely that a lawsuit will even come to fruition.
It is not very likely that the Embers will be successful in their lawsuits, if they are even filed, and it is more than likely that the entire situation will only serve to unofficially blacklist the organisation in the Rainbow Six scene. Legal or not, the contracts signed by the players were extremely lopsided and slanted towards the organisation, prompting a lawyer that TyTangles had asked for help to offhandedly compare the contracts to slavery.
What’s more, with the history of Labriola with Fibeon Esports, and now with the Pittsburgh Embers Rainbow Six roster, mainly regarding the allegations about their inability to provide salaries on time (or at all), late merchandise delivery, and supposed sponsorships that do not materialise, teams are going to be extremely wary of signing with the Embers in the future.
Say what the US courts may, the court of public opinion is firmly against the Pittsburgh Embers.
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