GameStop Can’t Unplug Suit Over Used Games

(CN) - GameStop must face claims that it tricked customers into wasting money on used games that did not include allegedly "integral" downloadable content, a federal judge ruled.

John Farley filed a putative class action against the Grapevine, Texas-based video game retailer in Burlington County, N.J., last year. Gamestop later removed the case to federal court, and Jamar McGhee and Hakana Ozdincer joined the class in November.

The plaintiffs claim they bought pre-owned video games from GameStop between May 2010 and January 2011, expecting to receive all of the content included with new games, including downloadable content (DLC) such as "extra game characters, levels, maps, screens, weapons, adventure scenarios," and the ability to play online.

But because this content - which the complaint describes as an integral feature of the games - can be downloaded only by using a single-use serial code that the manufacturer provides on new game boxes, pre-owned games do not include a useable code.

McGhee and Ozdincer said they therefore each had to pay $15 for DLC after purchasing a used game for $45, totaling more than the cost of a new video game that includes the content.

GameStop moved to dismiss for lack of standing and failure to state a claim, but U.S. District Judge Robert Kugler denied the motion Wednesday.

"Plaintiffs clearly have standing to sue," the unpublished opinion states. "Defendants unsuccessfully argue that plaintiffs may have purchased pre-owned video games that did not include DLC in order to save money. However, this argument targets the merits of plaintiffs' claims rather than plaintiffs' standing to assert the claims. Defendants also contend that plaintiff Farley did not purchase DLC and therefore did not spend more than he would have for a new video game that included DLC. This argument is similarly unsuccessful. A plaintiff need not spend money to correct defendant's errors to demonstrate a benefit-of-the-bargain loss under the [New Jersey Consumer Fraud Act] CFA."

McGhee and the others can also pursue claims that GameStop intentionally lied to them.

"Plaintiffs allege that defendants were aware of material information, that DLC was not included with the purchase of pre-owned games, but did not reveal this fact to plaintiffs," Kugler wrote. "Plaintiffs further allege that defendants knew that a large percentage of pre-owned video game purchasers would want DLC and made statements such as: 'our used game trade program creates value for customers' and 'You saved [dollar amount] buying Used!' to induce purchasers to buy pre-owned. Under these allegations, plaintiffs have plausibly stated a knowing omission."

GameStop's alleged misconduct may have caused the gamers' ascertainable loss, according to the 10-page opinion.

"Plaintiffs allege they purchased pre-owned video games from defendants because they believed, based on defendants' unlawful conduct, that DLC was included," Kugler wrote. "As a result, plaintiffs received less than they expected. Plaintiffs have sufficiently alleged a causal nexus between the alleged act of consumer fraud and the damages sustained."

The unjust enrichment claim also survived.

"Plaintiffs alleged that because the pre-owned video games were missing DLC, they did not 'work in the same manner as a new copy of the same game' because 'significant aspects of the original game ... were not included,'" Kugler wrote. "Plaintiffs essentially charge defendants with knowingly selling a defective product. Therefore, plaintiffs adequately pled unjust enrichment."

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit