Player wins MMO lawsuit

[Venkman]

Got this from one of my newsfeeds, but I see Slashdot picked it up as well.

Basically, a player sued an MMO company because their account was banned for long enough that their virtual goods depreciated in real world value.

Here's something for you MMORPG players out there. This month, an online gamer won a lawsuit worth thousands of dollars against Chinese game operator Shanda. The lawsuit revolved around devalued virtual game equipment and a damaged reputation.

Here's what happened: According to the report, a player of the MMORPG Legend of MIR II earlier this year logged into the game simultaneously from two accounts on the same IP address in order to transfer equipment from his account and another player's.

This prompted the owner of the second account to complain to Shanda, saying that his account had been looted by the first guy. Shanda then proceeded to suspend the account of the the guy accused of virtual theft.

It didn't end there (if it did then we wouldn't have a story at all). The player whose account had been suspended sued Shanda in Hengyang County, and according to the report the lawsuit included "requiring Shanda to unblock his account, and pay compensation of RMB 45,000 (US$ 5,625) for the depreciation of his game equipment during the suspension period, the damage to his character's reputation in the game, and his travel expenses."

The court evaluated the player's equipment through 5173.com and found his claim to have merit. He was awarded compensation of over RMB 30,000 (US$3,750). This decision was handed down on November 15. Shanda has made no comments on the case, and the company has four days left to make an appeal.

The details don't matter to me much really. Like, why would the player who had the second character complain they were looted when it was supposedly the recipient of nice new goods.

But what I do find interesting is that this 5173.com site (which I can't find an English version of) has such clout a judicial body would reference it to track the real world value of a virtual good. And then to actually require the company pay that player back for it.

There's lots of questions and potential ramifications here, but the biggie for me is this:

If an external company can ascribe real world value to a good, and the government validates that, then the control the developer has over that good is reduced. What happens to game balance then? What if an uber sword was deemed too uber and was nerfed? Suppose that sword was already sold to another player? Would that player be able to sue the company for diminishing the value of their purchase because they decided to better balance the game?

What does this do for mudflation? Can that even happen anymore? Or will a good need to stay the same relative value throughout the life of the game?

I am really hoping this is an isolated exception to the general rule, because otherwise there's big trouble ahead.

[geldonyetich]

The details don't matter to me much really. Like, why would the player who had the second character complain they were looted when it was supposedly the recipient of nice new goods.

They matter to me.  Why did the second account complain that his account had been looted if the guy was just doing a transfer of things to that account?  If there really was a virtual theft here, then what?  We're looking at the same scenario as somebody breaking into somebody's house, getting caught, and then suing the government for catching him and impounding the getaway car, winning the lawsuit for his freedom, his stuff, money in addition that he stole from the bank, and a formal apology to return his tarnished reputation.  Freaking nuts.  I suspect the authorities involved had no idea what was going on and this judgement will be overturned, or else China's litigation system is thoroughly corrupt and this guy was on the inside.

But lets assume that this wasn't the scenario and, in fact, we have somebody who simply sued and won over the possession of virtual items after being banned.

I am really hoping this is an isolated exception to the general rule, because otherwise there's big trouble ahead.

I'll say.  As a game operator, what am I going to think about people who are engaging in virtual item acquisition and trade in my game?  Probably something along the lines of, "Crap! I'm making myself legally liable by manufacturing virtual items they are assigning that much worth to!  I really ought to find a business where a lightning strike isn't going to cause me to owe my userbase  millions of dollars over monopoly money!"  Cue the end of MMORPGs as we know it. 

This isn't even getting into the need to ban certain individuals.  If I mouth off to players and end up getting banned, can I sue SOE for the value of the virtual items I lost?  A TOS agreement can't grant a company immunity to theft charges, especially if they were naive enough write in their TOS that the items or land in the game belongs to player.  (I'm talking to you, Linden Labs.)

[Merusk]

Or, alternatly, MMO companies say "Fuck China" pull out and don't go anywhere near the Capitol of Crazytown.

As to the 'don't the understand?' question.  Probably not.  Most of this stuff isn't understood completly by the folks playing in them, I don't expect someone involved in the real world more than the virtual to grasp all the nuances.

Yes, China's litigation system is thoroughly corrupt.  Their whole country is corrupt to the point everyone nationally and internationally was shocked when a high-ranking Party official was actually brought up on charges over the summer. 

Now, if this were a US ruling, or happened in the WTO court, things would be far more interesting.  As things currently stand, the fallout from those little South American countries telling the US "Hey buddy, you can't do that" on internet gambling is more salient than this ruling is.

[CmdrSlack]

If an external company can ascribe real world value to a good, and the government validates that, then the control the developer has over that good is reduced. What happens to game balance then? What if an uber sword was deemed too uber and was nerfed? Suppose that sword was already sold to another player? Would that player be able to sue the company for diminishing the value of their purchase because they decided to better balance the game?

What does this do for mudflation? Can that even happen anymore? Or will a good need to stay the same relative value throughout the life of the game?

I am really hoping this is an isolated exception to the general rule, because otherwise there's big trouble ahead.

I think you're really mixing questions here.

As far as using an outside source to obtain numbers for damages goes, it really depends on the facts -- and we don't have enough info from that story to really be sure.  It's not unheard of to use an external source to estimate the value of an item.  For instance, if we're talking about stocks, you'd certainly use the numbers provided by one of the major stock exchanges.  What about a situation where your landlord "loses" a bunch of your belongings, many of which are antiques/family heirlooms?  Wouldn't you want to get an appraiser in there (or better yet, use an appraisal that you had done before the stuff disappeared)?  Certainly a judge or jury is not automatically more qualified to make those determinations of valuation.

So let's say that this website they used is an RMT service or something similar.  Wouldn't those guys be in the best position to state what the market value for a specific item was over a specific set of dates?  Take, for example, the now defunct Gaming Open Market.  At one point, it tracked the value of the Linden Dollar to U.S. dollars very much like you'd see at a board of exchange.  If you had to value the Linden dollar for a specific amount of time to determine lost USD, wouldn't you want to use a third party service as opposed to the defendant's own estimates? 

Keep in mind that this assumes the U.S. court system.  As stated above, Chinese courts are often Crazytown.

The other question stems from what impact this decision would have.  I have no earthly idea how Chinese courts handle precedent.  However, if we took this situation and pretended it was happening here in the U.S., its impact would depend on the issues argued and how they were decided.  For instance, simply saying that a plaintiff is harmed due to the depreciation of his virtual assets doesn't really tell us much.  Was the cause of the harm his banning or not?  In this case, it seems that the guy was harmed because he could not convert those virtual assets to real currency for the period during which his account was banned.  It would set no real binding precedent (at least in the U.S.) that says, "Game developers, you cannot change items after they are released to the gaming public, for it may damage their value."  Moreover, I really dobut that such a scenario is likely in the United States.  Not only can such a claim be avoided via creative drafting of an EULA or TOS, but it is just really bad public policy to set a precedent that would implicate the rights of IP owners to such a large extent. 

My guess is that when this stuff really hits the U.S. court system (and I think it will...hell, there's already some cases out there), we'll see people throwing everything at the wall and seeing what sticks.  Barring a major revolution in the EULA As King regime, I don't think much will stick...unless lawyers get creative and look to the theories they always brush aside to make their cases.  I think the biggest, best and most likely target is Linden Lab. 

At the end of the day, we'll see this stuff slowly gain legitimacy, but never to the point of tying the hands of developers.  All hassle will be on the harm end -- and even then it'll be tough going. 

[Venkman]

For instance, simply saying that a plaintiff is harmed due to the depreciation of his virtual assets doesn't really tell us much

Yet, isn't the question being asked at all indication of at least real value being ascribed to a virtual good? It almost doesn't matter whether the asset caused harm or good to the plaintiff. The fact that it is causing "something" at all is where I wonder for the future.

I'm totally projecting of course. It's not about this one ruling. It's about the stepping stone this could be. First you ascribe value. Then that value has an impact. The person impacted is not tied to the company that generated the asset. Yet because that asset impacts that person, deeper questions about the handling of that asset must be asked. Simply requiring those questions being asked by a political or judicial body means the developer themselves no longer maintain full control over that handling.

So, ascribed value could eventually prevent proper game balance. That's the leap I made.

As to referencing 5173.com, yea, really don't know anything about it. Just a reference source for a court case. What made me wonder is the fact that this is an independent site tracking the financial value of a virtual asset, legitimized by reference by the court.

[CmdrSlack]

I think if you look back at news from both China and/or South Korea, you'll see that they've already ascribed value to this virtual stuff.  People have been granted the return of their virtual stuff, etc.  Most of it was based on breach of duty as opposed to value if I recall correctly.  For some reason, I'm about 90% sure that we'd seen actual value ascribed to this stuff within Asia.  As such, it seems to me that we're already past that and looking at the WHY of a harm -- was it due to incompetence (data loss, theft, improper ban, etc.) or is it due to acceptable game world changes? (nerfs, etc.) 

If the former, there's a case for restitution if that loss is measureable, perhaps the most equitable solution is to replace the item or cash or whatever with the same thing, or the in-game currency equivalent of the item.  If the latter, well, that's where we veer into interesting public policy questions.

Quite honestly, the developer never has full control over these virtual things -- there's publishers and ratings boards and state and federal laws that touch on these spaces.  It seems to me that the control you're worried about is the power to nerf and whatnot, not liability for screwing someone over.  Maybe it's both and I'm just misreading your posts.  Seriously though, the complete freedom of the developer is an illusion past a certain point. 

But if, as I think I'm seeing it, you are mostly concerned about  nerfs/balance passes, it would be bad public policy to prevent developers from doing that.  As I said above, it would simply require common sense, an understanding of IP law, and/or some simple disclaimers in EULAs/TOSes. 

[Venkman]

The developer maintains the right to adjust the stats of a sword, to adjust how frequently it enters the game world, and how quickly it can get mudflated throught the introduction of a better sword (whether the new sword has better values on the stats or focuses on new stats added into the system). All of these affect the real world value of that sword good as it were, on eBay or wherever. But because that's Black Market, the developer doesn't need to care.

When it's not Black Market though, now there's a complication. The company has a vested interest in moving that item, or seeing it move, so doesn't want to muck with this too much for business reason. I'm not thinking SOE Station Exchange here, but rather, GPotato (Space Cowboy) or Nexon (Maplestory), microtransaction based games. Here is where I agree with your point: already developer hasn't free reign. But those aren't widlly huge titles in North America nor EU either.

But add now government oversight on microtransacted goods. Yikes. Can a game even change at that point? Or does it get locked in some sort of stasis because the developer is too gunshy to make any change. We know supply/demand in the real world is based on real complex webs of interconnecting resources. In virtual worlds, those resources are just button pushes though. it's all fake really, including the intrinsic value of a good, because even the time it took to get that good was entirely contrived by the developer.

This is a slippery slope. Everything about an MMO is fake, from time to asset, on the part of the consumer. So how can real value be ascribed to any of it without severely legislating the body creating the time and asset itself?

[SurfD]

Im not much of a great legal mind, but i think i see something of a parallel that could maybe stand some clarification from the actual law students among us:

The person in the mentioned case sued for loss of value on goods / stuff on their character over a period of time because they were not able to access the character: Ie, Depreciation over the interval they were banned.

Is it possible in real world law to sue someone over depreciaton of goods?  If I tick off the government and they freeze my bank acount / stocks, can I sue someone for lost income if the stock decreases in value over the period of time i am unable to access it?
If they impound my car for a year, can I sue them for loss of value because i couldnt sell it at the start of the year when it was worth more?

I mean, hell, that would be like someone who was arrested and thrown in jail for 20 years suing the govenrment for loss of value on all the stuff he owned that he couldnt do anything with because he was in jail.

[CmdrSlack]

Im not much of a great legal mind, but i think i see something of a parallel that could maybe stand some clarification from the actual law students among us:

The person in the mentioned case sued for loss of value on goods / stuff on their character over a period of time because they were not able to access the character: Ie, Depreciation over the interval they were banned.

Is it possible in real world law to sue someone over depreciaton of goods?  If I tick off the government and they freeze my bank acount / stocks, can I sue someone for lost income if the stock decreases in value over the period of time i am unable to access it?
If they impound my car for a year, can I sue them for loss of value because i couldnt sell it at the start of the year when it was worth more?

I mean, hell, that would be like someone who was arrested and thrown in jail for 20 years suing the govenrment for loss of value on all the stuff he owned that he couldnt do anything with because he was in jail.

The major difference is that, in the U.S. system, you can't really sue the government itself.  The government has to consent to being sued.  It's called sovereign immunity.  When you hear of so and so suing the government, they're really suing governmental officials in a specific manner that avoids that immunity.

And DQ, as far as what you're afraid of is concerned, I really doubt that you'd ever see a situation like that.  It's bad public policy to fly in the face of the rights of IP owners (i.e. game companies) and say that they are prohibited from changing their game ever for fear of devaluing virtual items.  Not only are there possible EULA-style safety nets, but there's no reason to protect an individual from something losing value.  We don't protect those who lose money in the stock market beyond basic fraud and "you're doing the shareholders wrong" lawsuits.  It'd take  a TON of leaps to get to what you are proposing.

This is, of course, good.

[Endie]

Im not much of a great legal mind, but i think i see something of a parallel that could maybe stand some clarification from the actual law students among us:

I knew that law degree would eventually come in handy.  My rate is 400 guineas to the hour.

Is it possible in real world law to sue someone over depreciaton of goods?  If I tick off the government and they freeze my bank acount / stocks, can I sue someone for lost income if the stock decreases in value over the period of time i am unable to access it?
If they impound my car for a year, can I sue them for loss of value because i couldnt sell it at the start of the year when it was worth more?

Well, this kond of thing is called "pure economic loss" and is really, really difficult to sue for.  Meaning that "my asset was worth 100,000 when it was damaged, but was probably about to grow to 200,000 in value" is a massively difficult proposition to argue in delict/tort (sueing people that done you wrong).  Not impossible, and some legal systems have alternately dabbled then retreated when judges got tempted to rule in cases where it was so obviously the case that such damages had occurred that they effecively ruled in equity.  But really, really difficult.

As CmdrSlack says, governments tend to be covered by sovereign immunity.  They can waive that, but more commonly they explicitly legislate to reinforce their immunity: if they locked you up and froze your assets for a year, following which it turned out that you were in a coma when the alleged offence occurred, then most jurisdictions will find you either unable to recover damages, or having the extent of compensation decided by a quasi-judicial body set up by that very government.

A bit like MMOs and their EULAs: "we owe you nothing, but if we investigate and find we cocked up then we might give you your stuff back.  Might."

[Venkman]

And DQ, as far as what you're afraid of is concerned, I really doubt that you'd ever see a situation like that.  It's bad public policy to fly in the face of the rights of IP owners (i.e. game companies) and say that they are prohibited from changing their game ever for fear of devaluing virtual items.  Not only are there possible EULA-style safety nets, but there's no reason to protect an individual from something losing value.  We don't protect those who lose money in the stock market beyond basic fraud and "you're doing the shareholders wrong" lawsuits.  It'd take  a TON of leaps to get to what you are proposing.

Ok, I can get that. However, the guvmint has already been trying to force legislation to get game companies to change their games in some ways anyway. Thankfully the really poorly thought out nonsense from last year and this have mostly been ruled unconstitutional (or soon will be).

But that is a separate issue.

To your point, I can see a free market argument against the U.S. government from wanting to muck with a Adam Smith ideal situation such as this :)