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Judge Tosses Settlement for ‘Key Master’ Gamers

NEW YORK (CN) - A proposed class action settlement with angry players of Sega's allegedly rigged "Key Master" arcade game is full of holes and needs to be clarified, a federal judge ruled.

Sega Amusements USA Inc. and the other defendants in the case - creators of the Key Master amusement game - did not oppose the plan to award $650,000 to each member of the gaming class.

But U.S. District Judge Richard Berman rejected it nevertheless, finding the parties had failed to identify a plausible method of identifying and paying class members, and because he trouble by a request for some $850,000 in attorney's fees.

Lead plaintiff C. Stuart Brown filed the lawsuit in October 2013, alleging the game, which involves navigating a key into a keyhole, would sometimes refuse to dispense prizes even after the key was inserted into the hole.

The complaint alleged the marketing of the game of "false, deceptive and likely to mislead consumers because the machines are pre-programmed to prevent players from winning a prize even if they have followed the instructions on the game to effectively fit the key into the lock and free up a prize."

In rejecting the settlement, Judge Berman took issue with a proposal to notify potential class members through the use of Internet and mobile phone banner ads and a 600-word press release.

"Plaintiff provides no factual basis for its assertion that the various proposed 'banner ads' are likely to be seen by any, much less most or all, potential class members" and that "the potential for fraudulent claims is meaningful," Berman wrote.

The parties' inability to provide even a rough estimate of the number of class members also perturbed the judge.

"How many members of each subclass are there?" Berman asked in evident frustration. "Are they male and/or female? How old are they? Where do they live? What is their economic profile? Are they students? Do they work?

"In essence, how likely are they to view the proposed 'banner ads' and, even if they did so, how likely are they to subsequently follow the links to the Administration Website, view the Notice of Settlement, understand it, and file a Claim Form?" he asked.

The proposed "player notice" about the difficulty of the game was also skewered by Berman, who wrote:

"It is not clear to the court whether this complicated Player Notice language reflects drafting difficulties or the parties' failure to confront core factual allegations in the complain, i.e., whether or not 'the machines are preprogrammed to prevent players from winning a prize even if they have ... fit the key in the lock.'"

He concluded that the notice "does not provide any useful information to players of Key Master and, in fact, is likely to confuse them or simply be ignored."

Berman instructed the parties to file another motion to certify the settlement agreement after they have remedied the defects.

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