Video game company Take-Two Interactive Software faces a proposed class action over its marketing and sale of in-game “loot boxes,” in particular to minors, in its popular NBA 2K series.
The 30-page lawsuit contends that Take-Two’s use of non-refundable virtual currency (VC), with which a gamer can, for example, upgrade a basketball player’s stats or clothing, serves to “psychologically distance” players from the real-life financial implications of in-game purchases, namely by separating the expense of real money from whatever a player ends up buying in a game. The complaint argues that this method for generating revenue, whereby an in-game microtransaction can be completed with one click, works particularly well on minors, who “may not have a firm understanding of the correlation between the amount of real-world money and VC spent.”
Broadly, Take-Two “induces” minors to make purchases within NBA 2K, a game that’s bought by a player for a fixed price and upgraded as the playing experience expands, by way of emphasizing the need for virtual currency within the game’s ecosystem, the lawsuit alleges. The suit says that minor NBA 2K players buy virtual currency, which almost never corresponds evenly to the price of “loot” and player upgrades, without understanding the amounts involved in actual money, and usually through a parent’s credit or debit card. Prior to making a “microtransaction” in NBA 2K, a minor player will generally be unaware that their purchase is non-refundable, the case states.
“Using this system, Defendant perpetuates a cycle of NBA 2K players constantly needing VC, and never having enough, which leads players to purchase more. This cycle is further perpetuated by Defendant offering ‘limited time sales’ or ‘specials’ on certain loot prices and items, creating a sense of urgency to purchase.”
According to the suit, Take-Two nudges minors into making in-game purchases by concealing the non-refundability of the microtransactions, including by displaying it in a “very small font” or by providing the applicable terms through a separate link. Moreover, the lawsuit says that Take-Two’s regular introduction of newer content and promotional deals further induces minors into making in-game purchases, as anything already purchased “becomes stale quickly.”
From a legal standpoint, Take-Two also “misleads or misrepresents” the law applicable to microtransactions that involve minors, the complaint alleges. In Illinois and in “most states,” for instance, Take-Two knows that state law allows for a minor to disaffirm a contract, yet nevertheless wields a non-refundable policy for in-game microtransactions that unlawfully fails to acknowledge a minor’s right to obtain a refund, the suit relays.
The lawsuit looks to cover all persons in the United States, including minors, who, during the applicable statute of limitations period, had an account with Take-Two Interactive Software that they used to play a game on any device and in any mode and (a) exchanged in-game virtual currency for any in-game benefit, or (b) made a purchase of virtual currency or other in-game benefit for use within such game.
The lawsuit was initially filed on January 11, 2022 in Winnebago County Circuit Court before being removed to the Illinois Northern District Court, Western Division, on February 25.
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