Online game company Evony may not like the negative attention it has garnered online recently, but the company is about to get a lot more scrutiny after filing a libel lawsuit claiming defamation by the U.K.’s Guardian newspaper and gaming marketer Bruce Everiss.

Evony recently drew media attention for a series of racy online ads. The multiplayer game may not have a lot of scantily clad women its game, but over a series of weeks, the company increasingly relied on semi undressed females in ads promoting itself online, eventually just cribbing pics out of lingerie catalogs and putting links to its site next to cleavage.

The company’s methods led The Guardian to write an article titled “Has Evony become the most despised game on the web?” The company’s owner took none too well to such allegations and has since sued for libel. Taking advantage of the country’s favorable libel laws, Evony filed the suit in Australia. But while suing down under may have legal advantages for the company, it is only going to bring increased scrutiny on their business methods. And that is not likely to be a good thing.

Evony’s CEO Eric Lam has in the past worked on gold farming — where a third party collects and sells virtual items to wealthier gamers in the developed world — and Everiss estimates that Lam earns as much as half a million dollars a day from his company Wowmine. Evony itself appears to be popular, the company claims over 5 milion users internationally, but Lam has been sued for click fraud by Microsoft and his marketing methods have garnered more than a little negative press.

Evony is played online and uses little memory from computers, which allows many users to play while at work relatively unnoticed. Gamers can purchase virtual items to help move up levels and make it easier to get ahead in the game.

But in addition to the ads that have earned the company attention online, many have claimed to be spammed by the site. Design elements on the game also bear a striking resemblance to games like World of Warcraft and Civilization.

Both Everiss and The Guardian have pointed out that players have been charged for items they did not intend to purchase. Also, Everiss has written that Evony might be spreading malware with its ubiquitous sexual ads.

Much of this prompted Evony to file a lawsuit asking Everiss to remove the complaints from his website, issue a formal apology and pay the company damages for lost business because of his criticism.

Everiss does not seem likely to do these things. He wrote a follow up post and noted the following:

“Australia has a very old fashioned libel law where the person who
thinks they are libeled doesn’t have to prove anything. They can make
all the accusations they want and the onus is on me to bring evidence
to disprove every one. This is why Warren McKeon Dickson have listed so many silly and obvious things which everyone knows aren’t libel in their letter.”

Libel tourism is a growing concern online, where individuals can find a country with the most favorable libel laws and sue from there for any item posted on the Internet. But regardless of the feasibility of the claims that Evony has filed, a lawsuit is not likely going to work out well for the company.

Instead of letting the complaints disappear, it invites far more scrutiny. According to Eric Goldman, director of the High Tech Law Institute at Santa Clara University School of Law:

“It’s very hard to get complete vindication in a libel suit. No matter whether you win or lose, bringing a lawsuit has the potential to bring attention to complaints in ways that could be far more damaging even if you win the case.”

And in respect to the variety of complaints and their differing nature, that can’t be good for Evony. Regarding the malware issue in their ads, a Google spokesperson told me this afternoon:

“We actively work to detect and remove sites that
serve malware in our ad network, and we immediately suspend accounts
found to contain ads that point to sites that install malware. As such,
we’ve added this site to our malware list and are in the process of removing any offending sites from our ad
network.”

While Lam and Evony may have hoped that the threat of a lawsuit filed in Australia (and the subsequent fees that go with defending there) would force people to stop writing negatively about them, it’s more likely to instigate the Streisand effect, and just further publicize criticisms.

“There are some really small time bloggers who are basically talking to themselves,” says Goldman. “But when a lawsuit comes out, now we’re all going to say, ‘What did they say?’ Having those allegations repeated is extremely damaging.”

And Everiss for one is stepping up his charges:

“If you want to help beat these people you can. Just cut and paste
anything I have ever said about Evony on here and put it anywhere and
everywhere on the web. You don’t even have to credit the source if you
don’t want to. They cannot threaten everybody! The more that the truth
about Evony is propagated the better the Streisand effect will be.”

Image: TOBlender.com