Steam’s Sub Agreement Prohibits Class-Action Lawsuits

Legally binding agreements that rule out class-action lawsuits are nothing new on our little slice of the technological frontier. In fact, last year it basically became the thing all the cool kids were doing, with Microsoft, Sony, and EA each sneaking similar clauses into those George R. R. Martin-length novels people scroll past when they start new games. Valve, however, is taking an intriguingly different approach. The company who’s been known to show up to parties with a nametag that reads “Hello, my name is ‘PC gaming'” put out an announcement detailing the exact reasoning behind the change, and it promises this is just as much about customers’ best interests as it is Valve’s.

For the uninitiated, a class-action lawsuit involves a large group of people issuing a single, collective suit. Valve, however, argues that this rarely helps anyone in the long run, so it’s offering a different solution – in which it foots the bill for your court fees, no less.

“On Steam, whenever a customer is unhappy with any transaction, our first goal is to resolve things as quickly as possible through the normal customer support process. However in those instances in which we can’t resolve a dispute, we’ve outlined a new required process whereby we agree to use arbitration or small claims court to resolve the dispute. In the arbitration process, Valve will reimburse your costs of the arbitration for claims under [$10,000]. Reimbursement by Valve is provided regardless of the arbitrator’s decision, provided that the arbitrator does not determine the claim to be frivolous or the costs unreasonable.”

“Most significant to the new dispute resolution terms is that customers may now only bring individual claims, not class action claims. We considered this change very carefully. It’s clear to us that in some situations, class actions have real benefits to customers. In far too many cases however, class actions don’t provide any real benefit to users and instead impose unnecessary expense and delay, and are often designed to benefit the class action lawyers who craft and litigate these claims. We think this new dispute resolution process is faster and better for you and Valve while avoiding unnecessary costs, and that it will therefore benefit the community as a whole.”

So it certainly sounds altruistic, and – this being Valve – there could very well be nothing but good intentions driving it. Intentions, however, only go so far, and this still leaves the door open for some potentially less-than-scrupulous dealings. For instance, as Ars Technica points out, this new Subscriber Agreement grants Valve the power to scatter the pitchforks and torches of movements related to widespread bans – even in cases where players have already paid for their games. Honestly, we wouldn’t care even if we were dealing with Gandhi And His Best Friend, A Baby Hedgehog Who Can Only Communicate With Hugs, Corp. We’d still be worried about a company possessing complete legal immunity from these sorts of things.

At this point, then, we have a couple options: 1) watch and wait or 2) click the big, bad “disagree” button when Valve’s latest proclamation descends from on-high. As of writing, however, we’re not exactly sure where the second option will leave your games. But, if you’re locked out of Steam, well, the implication’s not great. So that’s problematic.

With this in mind, we spoke to lawyer Alex Chapman of Sheridans to ask if this could really stand up. It is, as you’d expect, complicated.

Chapman explains that as a business move, it makes sense. In the US, the legal system does not require a losing party to pay the costs of the other side in such cases. So no matter how dubious a case brought against Valve, they’ll always be required to pay their legal fees to defend themselves. This, Chapman tells us, is why there’s such a culture of trademark and patent “trolls” over there. And that’s not something Valve wants to be batting away. “Valve will be worried about class actions because most claims that Valve face will be for relatively small amounts and would not normally even go near a lawyer, let alone a court,” he tells us. “However in a class action, plaintiffs, who might individually have a very small claim, may combine to have a claim that is worth suing over.”

And as such, it’s in Valve’s interests to create conditions where this can’t happen. But how effective is that likely to be? Can you just rule yourself out of legal processes?

“In some jurisdictions this provision would not be enforceable,” explains the legal eagle, “since generally speaking the law that applies in consumer related cases is the local law where the consumer is located.” Each country’s laws could completely contradict Valve’s attempts to prevent class action suits, and possibly even individual State laws within the US. “In the UK,” Chapman continues, “it may be considered to be an unfair contract term.”

Further, this attempt to prevent class action lawsuits by Valve won’t be taken seriously until – funnily enough – someone attempts a class action lawsuit against Valve. Chapman explains, “Perhaps most significantly is that if there is any possibility that this term could be challenged then the first thing a litigator would do is to bring a class action to challenge the validity and enforceability of the contract term (or to do so as part of the class action itself). The effect is the same, namely that a claim would be brought against the party relying on the terms and that party would have to defend the claim or settle it. It would just so happen that the first part of the claim would deal with enforceability.”

So in the end, like most of what’s written in a EULA, it’s more about what the company hopes will be law, rather than what actually is. And as ever, until such inclusions are legally challenged, no one has any idea if they’re at all enforceable. Which in Valve’s case will take a group starting a class action lawsuit against them. Law, eh?

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