LGJ: Class Dismissed
Each week Mark Methenitis contributes Law of the Game on Joystiq ("LGJ"), a column on legal issues as they relate to video games:

It seems almost weekly a new article appears on Joystiq referencing yet another class action filed against the game industry. If it's not consoles, it's kick pedals. As a result of this class action proliferation, I was asked by a reader to explain this whole class action concept in a little more detail. I'm sure most people have some idea of the basic concept behind the class action, but not necessarily why it's become the weapon of choice, so to speak, of certain disgruntled gamers or what these lawsuits actually entail.
The basic idea behind a class action suit is to resolve a large number of suits with similar elements in one proceeding, rather than requiring each to have its own proceeding. These similarly situated plaintiffs make up the 'class' in the class action. Taking the red ring suit as an example, there are a large number of people whose Xbox360s red ringed who could file suit under the theory presented. Rather than force Microsoft to potentially deal with each suit individually, they can deal with that 'class' in a single legal action. In reality, that's a gross oversimplification of the process.
These suits actually work in the opposite way than many people expect. Rather than acting to allow the defendant to aggregate suits, it is generally a plaintiff who brings suit on behalf of the 'class' represented. It is probably worth noting that there are both Federal class actions and state level class actions in the United States, although not all states have class actions. It's also worth noting that while class actions do exist outside the US, they are far more common in the US than elsewhere. With that in mind, most of the descriptions here are general, and not specific to any particular form of class action.
The first major hurdle for the plaintiff is getting the class certified. A class has to have a few essential elements. First, the class has to have enough people, and a general benchmark is more than 30. Second, the group of people has to have a commonality of damages related to a common issue. In the Harmonix case, the common damage is the Rock Band pedal and the common issue is a defective product. Third, the same event or time period must apply to all plaintiffs. Fourth, all plaintiffs must take the same legal argument. As you might have noticed in some of the suits over similar topics, not everyone sues on the same grounds or based on the same legal theory. One of the class action ground rules is that everyone must be on board with the same legal argument. Fifth, the law firm representing the class must be able to handle such a case, which includes atypical law firm activities like managing the class members and handling payments of the potential judgment to all of the class members. Finally, the defendant must be able to pay the potential damages.
The last element is part of what makes class actions popular and potentially lucrative, but has also led many legal scholars to additional criticisms of the concept, especially more recent peripheral elements like SueEasy.com. Class action defendants are typically huge corporations with deep pockets. As a result, the judgements are typically very large on the aggregate. This, however, creates a bit of a double-edged sword. On the one hand, many attorneys will accept these cases on contingency as the potential financial windfall is huge. This also means whoever wants to bring the suit isn't out any money, making it an easy mechanism for whoever brings the suit to the law firm. On the other hand, between the number of plaintiffs and the contingent fee coming off the top of the verdict, the payment to the class members is often very, very small.
So why are so many suits going this direction, especially in the gaming world? In short, my theory is that it's largely a function of the individual suits being financially impractical. Think of it this way: If I were to, alone, sue Harmonix over my broken Rock Band drum pedal, what would my damages be? I'd say the pedal is worth maybe $20, or the price of a full drum kit if the pedal can't be secured alone, plus maybe some punative damages. So why am I going to spend potentially thousands or tens of thousands of dollars to sue over it? On the other hand, if I can get 50,000 people who all bought Rock Band in on it, then the numbers work more in favor of the suit. Even an Xbox360 at full value isn't worth enough to justify an individual suit, but 100,000 of them certainly would be. It's basically an economy of scale that is a direct result of the high cost of litigation today.
Are class action lawsuits the best answer to issues like these? While I'm sure class action attorneys would disagree, I don't think they're the best solution, but they likely are the best available and reasonably practical solution given the framework we have to work in. However, that's not to say that all class actions are valid or should be successful either. Just like anything, be that groups of lawsuits or groups of video games, there are good ones and bad ones in the bunch. The hope is that the good ones succeed and the bad ones do not, though I think anyone can recognize that isn't always the case.
Mark Methenitis is the Editor in Chief of the Law of the Game blog, which discusses legal issues in video games. Mr. Methenitis is also a licensed attorney in the state of Texas with The Vernon Law Group, PLLC and a member of the Texas Bar Assoc., American Bar Assoc., and the International Game Developers Assoc. Opinions expressed in this column are his own. Reach him at: lawofthegame [AAT] gmail [DAWT] com.
The content of this blog article is not legal advice. It only constitutes commentary on legal issues, and is for educational and informational purposes only. Reading this blog, replying to its posts, or any other interaction on this site does not create an attorney-client privilege between you and the author. The opinions expressed on this site are not the opinions of AOL LLC., Weblogs, Inc., Joystiq.com, or The Vernon Law Group, PLLC. As with any legal issue that may confront you in a particular situation, you should always consult a qualified attorney familiar with the laws in your state.

It seems almost weekly a new article appears on Joystiq referencing yet another class action filed against the game industry. If it's not consoles, it's kick pedals. As a result of this class action proliferation, I was asked by a reader to explain this whole class action concept in a little more detail. I'm sure most people have some idea of the basic concept behind the class action, but not necessarily why it's become the weapon of choice, so to speak, of certain disgruntled gamers or what these lawsuits actually entail.
The basic idea behind a class action suit is to resolve a large number of suits with similar elements in one proceeding, rather than requiring each to have its own proceeding. These similarly situated plaintiffs make up the 'class' in the class action. Taking the red ring suit as an example, there are a large number of people whose Xbox360s red ringed who could file suit under the theory presented. Rather than force Microsoft to potentially deal with each suit individually, they can deal with that 'class' in a single legal action. In reality, that's a gross oversimplification of the process.
These suits actually work in the opposite way than many people expect. Rather than acting to allow the defendant to aggregate suits, it is generally a plaintiff who brings suit on behalf of the 'class' represented. It is probably worth noting that there are both Federal class actions and state level class actions in the United States, although not all states have class actions. It's also worth noting that while class actions do exist outside the US, they are far more common in the US than elsewhere. With that in mind, most of the descriptions here are general, and not specific to any particular form of class action.
The first major hurdle for the plaintiff is getting the class certified. A class has to have a few essential elements. First, the class has to have enough people, and a general benchmark is more than 30. Second, the group of people has to have a commonality of damages related to a common issue. In the Harmonix case, the common damage is the Rock Band pedal and the common issue is a defective product. Third, the same event or time period must apply to all plaintiffs. Fourth, all plaintiffs must take the same legal argument. As you might have noticed in some of the suits over similar topics, not everyone sues on the same grounds or based on the same legal theory. One of the class action ground rules is that everyone must be on board with the same legal argument. Fifth, the law firm representing the class must be able to handle such a case, which includes atypical law firm activities like managing the class members and handling payments of the potential judgment to all of the class members. Finally, the defendant must be able to pay the potential damages.
"Class action defendants are typically huge corporations with deep pockets. As a result, the judgements are typically very large on aggregate." |
The last element is part of what makes class actions popular and potentially lucrative, but has also led many legal scholars to additional criticisms of the concept, especially more recent peripheral elements like SueEasy.com. Class action defendants are typically huge corporations with deep pockets. As a result, the judgements are typically very large on the aggregate. This, however, creates a bit of a double-edged sword. On the one hand, many attorneys will accept these cases on contingency as the potential financial windfall is huge. This also means whoever wants to bring the suit isn't out any money, making it an easy mechanism for whoever brings the suit to the law firm. On the other hand, between the number of plaintiffs and the contingent fee coming off the top of the verdict, the payment to the class members is often very, very small.
So why are so many suits going this direction, especially in the gaming world? In short, my theory is that it's largely a function of the individual suits being financially impractical. Think of it this way: If I were to, alone, sue Harmonix over my broken Rock Band drum pedal, what would my damages be? I'd say the pedal is worth maybe $20, or the price of a full drum kit if the pedal can't be secured alone, plus maybe some punative damages. So why am I going to spend potentially thousands or tens of thousands of dollars to sue over it? On the other hand, if I can get 50,000 people who all bought Rock Band in on it, then the numbers work more in favor of the suit. Even an Xbox360 at full value isn't worth enough to justify an individual suit, but 100,000 of them certainly would be. It's basically an economy of scale that is a direct result of the high cost of litigation today.
Are class action lawsuits the best answer to issues like these? While I'm sure class action attorneys would disagree, I don't think they're the best solution, but they likely are the best available and reasonably practical solution given the framework we have to work in. However, that's not to say that all class actions are valid or should be successful either. Just like anything, be that groups of lawsuits or groups of video games, there are good ones and bad ones in the bunch. The hope is that the good ones succeed and the bad ones do not, though I think anyone can recognize that isn't always the case.
Mark Methenitis is the Editor in Chief of the Law of the Game blog, which discusses legal issues in video games. Mr. Methenitis is also a licensed attorney in the state of Texas with The Vernon Law Group, PLLC and a member of the Texas Bar Assoc., American Bar Assoc., and the International Game Developers Assoc. Opinions expressed in this column are his own. Reach him at: lawofthegame [AAT] gmail [DAWT] com.
The content of this blog article is not legal advice. It only constitutes commentary on legal issues, and is for educational and informational purposes only. Reading this blog, replying to its posts, or any other interaction on this site does not create an attorney-client privilege between you and the author. The opinions expressed on this site are not the opinions of AOL LLC., Weblogs, Inc., Joystiq.com, or The Vernon Law Group, PLLC. As with any legal issue that may confront you in a particular situation, you should always consult a qualified attorney familiar with the laws in your state.











Reader Comments (Page 1 of 1)
WiiFTW @ Dec 4th 2008 9:29PM
Wow that Sue Easy site is crazy.
"Circumcision is sexual abuse, torture and mutilation"
http://www.sueeasy.com/class_action_detail.php?case_id=258
They go a bit more "detailed" and starts to get reallyyyyy awkward.
Dartmerc @ Dec 4th 2008 10:27PM
They should sue that site for allowing them to post and looking like dicks.
DWells55 @ Dec 5th 2008 1:02PM
"These perps manipulate my nervous system as well as the environment around me, including innocent people through mind-control and forced speech. They have manipulated my electronics and keep a 24/7 constant surveillance on me, including when I sleep or travel underground via public transportation."
http://www.sueeasy.com/class_action_detail.php?case_id=350
This site is hilarious. I'm just going through these for cheap lulz now.
Ignatius @ Dec 5th 2008 9:48AM
How would you describe cutting pieces off of babies' genitals?
I think that's an apt description. :P
Crono (NDF - Knight of the Old School) @ Dec 5th 2008 10:46AM
Do you decribe other forms of body modification, such as ear or navel piercing, as mutilation or torture? Circumcision has no long term adverse effects (unlike female genital mutilation) and has proven to show some sexual health benefits in adulthood.
Ignatius @ Dec 5th 2008 11:00AM
When you have your ears pierced, you are submitting to it under full knowledge of what is going to happen. When you're being circumcised, the only one who has the decision is your parents.
There is one huge difference, choice. Cutting off the ultra-sensitive nerve endings is pain beyond pain. In any case, the need for circumcision was gone after trench warfare died and disease isn't as common as before.
Lousy Username @ Dec 4th 2008 9:36PM
"In the criminal justice system, the people are represented by two seperate yet equally important groups: the police who investigate crime and the district attorneys who prosecute the offender. These ar their stories..."
Lousy Username @ Dec 4th 2008 9:43PM
*are*...DOINK DOINK!
Skyway Park @ Dec 4th 2008 9:54PM
Here's a legal question for you, Mark Methenitis.
Here's a video of a guy having hardware problems with his Xbox 360..... but he is not getting the "3" rings of death, he is getting "2".
What does this mean?
http://www.youtube.com/watch?v=Plhjrx3zTFg&feature=related
-slycooper_rocker- (lorddshadow the amazing) psn: shahanasalam @ Dec 4th 2008 11:13PM
methinitis...i like it.
Jason @ Dec 5th 2008 2:56AM
With this generation of consoles, games, and software I think companies should be giving out longer warranties. I'm on my 2nd 60GB PS3, 4th 360 which is giving me bs right now (3 premiums 4th black), my hd dvd drive is junking out on the usb ports, and with all the rock band/guitar hero stuff it's horrible. Make everything compatible and choose quality over quantity. My Wii collects dust as do probably most peoples but it's kicking ass. With gaming more than other electronics it seems 1st come 1st serve fix the issues later. It's unacceptable and is insulting to the consumer. WE shell out $200+ on your hardware, $60/$80 each game, and they break within 5 months. Nintendo didn't go all big and bad and they have the best RELIABLE platform, quality games are another issue I won't touch. Nintendo's worst fault was not anticipating people love swinging their arms and breaking the strap. Microsoft you update your software and now my dashboard lags, either fire you engineers or as that one story showed LISTEN TO THEM!!! BTW I'm not a RB GH player so I can't comment on their products too much.
Ramifications @ Dec 5th 2008 3:35AM
Thanks Mark for this post. I had always wondered why people went the route of class actions rather than a single litigation on behalf of themselves alone!
This really helped me to understand the reasoning behind class actions. Great post Mark!