Guild Wars publisher insists leak of personal data caused no damage

NCSoft Corp, the publisher of popular online games Guild Wars, Auto Assault, City of Heroes and Lineage, is to appeal against a court verdict that found it responsible for the theft of several players' personal information.

Although the total damages awarded were small, the case is dangerous for NCSoft because it could provide fuel for claimants who are demanding millions of dollars in another, much larger, identity theft case, an analyst told the Korea Times today.

In the most recent court verdict, NCSoft was ordered to pay about $500 each to five players of the game Lineage II.

Due to a programming error, tens of thousands of players' usernames and passwords were accessible to all users of the game for several days in May 2005, Korean media reported.

The usernames and passwords could give unauthorised people access to players' personal details. The five players who sued the company were among those affected.

The Korean court ruled that NCSoft failed to take adequate care of players' personal information.

"There is little likelihood that the data was leaked outside and we have yet to receive any damage report from it. We think this is a different case compared to other identity theft," an NCSoft spokeswoman told the Korea Times today.

"We cannot accept the ruling because there was no report of actual damage from the case, which involves just the potential risk of information leakage."

While the damages awarded by the court are negligible, NCSoft is anxious to avoid any taint of liability for mishandling users' personal information, say observers.

This is because the company is still reeling from a much larger identity theft case uncovered earlier this year, which may have affected more than one million people.

However, a significant difference is that in this second, larger ID theft case, the leak of personal information appears to have started outside NCSoft with the theft of government ID numbers from various online databases.

These numbers were then used to create bogus Lineage accounts at NCSoft.

The number of people affected by the larger identity theft case has been put at more than one million by government investigators. The case caused an outcry in Korea, and the government has moved to tighten up laws to prevent a recurrence.

A related class action suit initiated earlier this year in Korea demands $1,000 in damages from NCSoft for each identity theft victim.

The company, which has strongly denied liability, would potentially face claims of more than $1bn if that class action suit were to succeed in its present form.

NCSoft will make an operating profit of about $64m this year, on sales of $260m, according to forecasts from Korea Investment & Securities published in February.

While Lineage I and Lineage II are NCSoft's best selling games globally due to very strong sales in Asia, some of the company's other massively multiplayer online games are better known in Western nations.

Most notable among these is Guild Wars, which sold 1.27 million copies last year, according to Seoul-based Hyundai Securities. The company recently released Auto Assault, and plans to release a new online game, Aion, at the end of the year.