Hacker News new | past | comments | ask | show | jobs | submit login
Epic will pay off class-action loot-box settlement with in-game currency (arstechnica.com)
236 points by pseudolus 7 days ago | hide | past | favorite | 143 comments

Can someone please explain to me how this is not just a complete travesty and perversion of settlements?

>In a way, the digital giveaway could even be seen as an effective promotion, luring players back to the games and creating the potential for them to spend more on additional microtransactions down the road.

That. That's the part I need explained to me. Get punished, but use the punishment to hook players even more. How is this allowed?

> Get punished

But, this isn't even a punishment. In game currency isn't real. It doesn't cost the company anything. So, this is 'be found guilty and be forced to go back to your junkies and give them their next hit of crack for free.'

I can imagine the ad banners: "Thousands of players will win new loot, will you be one? Play to find out".

>So, this is 'be found guilty and be forced to go back to your junkies and give them their next hit of crack for free.'

It's worse, like you said, the in-game currency isn't even real, unlike a hit the dealer has to hand out for free...


It's actually less "real" than Bitcoin. I haven't read the Fortnite TOS, but game companies always grant themselves unilateral permission to create/destroy in-game items/etc whenever they please.

AFAIK know, there's no trading in Fortnite. Games like Hearthstone or League of Legends where there is no way to exchange your goods for anything outside the game (except maybe selling the account as a whole) are indeed nowhere as real as bitcoin. On the otherhand, if it was a Valve game where you can trade items or sell them on the market place, then yes, those have a real value. Although dumping $78m of items in such a market place would probably collapse the item economy?

You can buy a car with bitcoin, but you cannot buy a car with fortnite bucks, that's generally the metric I use to tell how real a currency is and how usable it is.

Bitcoin supply is fixed. In-game currency gets created with a database query.

And they're not giving everybody billions. They're forgoing some fraction of $.07B that represents the revenue they would have otherwise captured. My guess is the fraction of people who spend less on these games because they got a little free in-game currency is near-zero and they might actually see a bump in revenue because they can now send out a marketing blast telling inactive users they have a reason to come back.

Ingame currency cannot be sold or transferred and is 100% lost if the publisher decides to ban you.

In other words, it's not really comparable to any cryptocurrency. Heck, even Steam's stickers/pictures you can unlock by playing games are more of a currency as you can sell (and buy) them for real money.

It’s far less real than Bitcoin if you can’t trade it on an open market.

This is like paying a settlement to employees in a company script instead of legal tender.

> To see this isn't true let's imagine they give away billion points to each player at once. How will their profits from that game change? I expect a big drop.

I wonder about that. The motive in the in-game economy is to have, and spend, more than other players, right? Handing out in-game money to all participants might disrupt things in that everyone can now buy the fancy in-game items, but the competitive/relative component presumably remains. If you want even more in-game items than other players, the dynamic is still there: you still need to pay up.

I mean, they could just devalue the in-game currency. Purchasing said currency would be cheaper, and in game items would be more expensive. It'd be a short-term disruption, but ultimately it wouldn't cost the company much directly, other than temporarily dissatisfied users.

You could even mitigate the former by compensating players by providing them more currency in proportion to the pre-devaluation purchasing power of their virtual wallet.

> they could just devalue the in-game currency

Item prices are fixed by the developer, aren't they? edit I suppose that just kicks the stone down the road. There would still be devaluation in the sense that scarce and expensive items become commonplace.

The item prices could always be "re-fixed" by the developer. There's no reason they must to remain static, especially if there was some "give billions of the currency to everybody" that was somehow unable to be rolled back.

Yes and no...their currency is in their playground. They can manipulate it however they want (though I wonder if that's even legal/would bring on another class action). They can't manipulate the dollar to reduce the impact, though.

I'm being pedantic, but no currency is "real". This one allows players to buy thing, which they are likely to want to do since they have in the past (and cared enough to start a class action over). You deciding that those goods are "hits of crack" is entirely subjective.

However it is true that it only costs Epic the lost revenue from selling those v-bucks. If a freely-tradable currency was emitted to cover debt, you'd have the penalty of devaluation, but that is not the case here. Of course that makes no difference for the players, that's only about punishment.

One time I bought a Nissan Versa. It had a Continuously Variable Transmission in it. They knew that they broke constantly, and they sold it anyway. They lied to me and said my transmission was fine a few months before the warranty was over, so they wouldn't have to replace it. Years after I traded that car in and it went immediately to a junk yard, Nissan settled a class action lawsuit over it. The compensation? A voucher for a few thousand towards a new Nissan.

I promise that when I joined a class action lawsuit over Nissan screwing me over, my goal wasn't to buy more Nissans. I would hazard a guess that many players who felt cheated enough by Epic to join a lawsuit against them likely feel similar.

A few years ago the state of Oregon sued oracle over their failed implementation of their ACA marketplace. They settled for a bunch of free oracle licenses. I scratched my head over that one.

> I'm being pedantic, but no currency is "real".

It is real in the sense that you can chose where you spend it. While this is like coupons. It may have value but that is very limited and therefore does not qualify as currency.

>How is this allowed?

You are pretty much assuming they are liable for the allegations in the complaint against them.

Settlements for low value are a sign that plaintiffs view their chances of success (including being awarded substantial damages) as being low.

So one way of looking at this is, Epic did nothing wrong, and they are giving away essentially nothing to make the plaintiff go away.

If plaintiffs thought they had a good case, they wouldn't take monopoly money.

Notably, the attorneys aren't taking monopoly money.

> Additionally, the attorneys who brought the lawsuit (see FAQ 10) will ask the Court to award them attorney’s fees and expenses in an amount not to exceed $11,300,000.00, for the time, expense and effort expended in investigating the facts, litigation, and negotiating the Settlement. The Class Representatives will also ask the Court for a payment of up to $75,000 collectively for their time, effort, and service in this matter.


The lawyers get real money, and the victims get fake money. That's the real scandal. Our tort system is broken.

Is the risk-adjusted price that the lawyers are being paid unusually high? Lawyers being expensive doesn't really mean "Our tort system is broken".

It does, because it diverts money from the people who are actually harmed to people who advocate on their behalf; and raises the threshold for a class-action suit in general, as suits that are "too cheap" are not worth anyone's time.

$11,375,000.00 will be payed by EPIC ? if yes, it looks like a corruption scheme

The settlement could also be low because the lawyers on the plaintiff side were not acting in the best interests of the people they were representing, just in their own best interests.

The plaintiffs may just value what's being offered. It might be money they'd have otherwise spent.

Not my cup of tea, but I run a mile from any game that requires I shovel cash into it to get ahead

They probably saw their chances of winning against EPIC’s legal team being very low. That legal team is stacked atm.

Similar strategies have been used before; seven or so years after opening a lawsuit about a data breach at Zappos, claimants were offered 10% coupons for the Zappos online store.


Yep, I remember getting Ticketmaster credit for their class action lawsuit.

I owned an '76 Chevy pickup and GM sent a coupon worth $1000 off the purchase of a brand new pickup as a settlement.

Never used it, but I assume Dealer Keeps All Incentives applied.

(They had side-saddle gas tanks that increased the chances of a fire in an accident.)


I got tons of free tickets in that one. I was never able to find an event to spend them on. What a fiasco.

It's legal because both sides agreed to settle for it.

If it was an individual suing Epic, and they agreed to go away in return for some shiny digital magic beans, you wouldn't see anything wrong with that. What's different if a million customers settle for it?

Customers can opt out of the class action, or start their own competing one. What would be a real problem is if other customers opted out, sued Epic individually, didn't settle, and the judge used the "payout" from the previous settlement to decide what a fair compensation would be. That hasn't happened here.

> It's legal because both sides agreed to settle for it.

I bet the lawyers representing the class aren't getting paid in VBucks. There are really three sides - Epic, the consumers, and the lawyers.

The fact that class actions are opt-out instead of opt-in is a big part of the problem.

There are lots of things that are still illegal even if both sides agree to it. Slavery for instance. Also all the things covered by consumer protection litigation, which top commenter is probably thinking of.

The conditions/clauses of the agreement must not be illegal.

Hmm, I’m guessing the lawyers behind the suit aren’t getting paid in loot.

Lol, I'm sure every single person in the class action suit agreed to the settlement, and otherwise would be able to afford to sue them again. Right.

Settlements are decided by a single class representative, and other class members are often not given notice of their right to opt-out or counter-sue.

And that's why you'd opt into a class action in the first place. You have a problem, you elect someone to handle it for you, give them decision making power and accept the outcome they've been able to achieve. It's just democracy, no?

All of this makes sense except for the bit about democracy. That's unrelated; this happens to be a process that's in use here, but it would work just as well in a monarchy.

Is it even about punishment? This is a civil case about loot-boxes.

The settlement is to pay off the lawyers and make the case go away.

I'm not that morally opposed to loot boxes and I don't believe any laws were broken. What kind of punishment are you looking for?

I hope the lawyers are also paid with in-game currency.

Or exposure

A disincentive to continuing the activity the class action suit was brought for.

In theory, class action lawsuits are either or both 1) compensate victims 2) "force" company to stop activity society deems "bad"

Victims care about #1, the rest of us want #2 so we don't become victims in the future.

In this case, stop exploiting addiction and other human psychology for profit via loot boxes.

The point of the settlement is to hit a company hard enough so they stop before doing something like this again.

Using in game currency and not real money is absolutely not going to achieve this.

No, that would be the purpose of a judgement. This isn't a judgement, it's a settlement. To Epic, the purpose is to make this go away. To those suing, the point is take a small but guaranteed windfall rather than risk a lengthy and uncertain court process.

It reminds me of how Nintendo settled US AG lawsuits on price fixing with coupons for Nintendo products. There's definitely a precedent.


This would be like the big tobacco settlement being: big tobacco will pay smokers 100 billion tobacco bucks redeemable for cigarettes at an exchange rate of 100 tobacco bucks per cigarette.

With cigarettes, there's at least a real product there that has some cost to the company that made it.

With epic game currency, it's just a bunch of bits that could be created without any resource use by the company. They could create 10x more game currency at no more cost to the company.

Some dev has to run an INSERT statement. And maybe a test case. Cheap.

It's because this is a settlement out-of-court. Basically the lawyers thought the case was really weak so they took what they could get. Or perhaps they were corrupt.

This is common and there is some psychology involved in how to create these scenarios.

Basically you can scare the government into thinking the state’s actions will reduce competition (because your company wont exist anymore if you pay). The government uses so much energy trying to create/continue private sector competition that they don’t want to be directly responsible for creating closer to a monopoly of the remaining companies in the sector.

So they’ll accept these consequence free settlements, or even get behind settlements that actually are advertisements.

The court here is granting approval of the settlement.

It's like a casino settling with victims of an addiction machine with tokens for other games that can't be cashed out.

The question is whether the class action suit's intent is to punish them (as in, did they commit a crime?), or to get compensation for their behaviour. If the latter, then the suing parties probably agreed to them settling via in game currency.
ashtonkem 7 days ago [flagged]

Because the regulators are completely captured.

Please don't post ideological battle comments and flamebait to HN. There's no information here, just a trope repetition; that makes this strictly a discussion-lowering comment. We penalize accounts that post like this, so please don't.


What regulators, though? Class sued the company and agreed to these ridiculous terms. I'd see a role to question maybe the integrity of the lawyers accepting the deal, or the mechanics of entering/disputing/leaving class action lawsuits in this world where now class members can easily reach into the many, many millions. But, like another commenter posted, if these were just two parties agreeing to this (which in some sense it is), we wouldn't have a problem with this at all.

> What regulators, though?

Online gambling regulators.

Remember this next time the HN crowd gets their pitch forks out against Apple and their dispute with Epic. Who is really the “evil” company here.

They can both be evil.

Class action lawsuits are turning out to be a scam. It should be law that lawyers can't have more than something like 5% of the settlement, and companies should have to pay out as cash equivelant.

Reminds me of the Equifax settlement which was a total scam. "Free Credit Monitoring" was BS, as Equifax was going to pay itself for the product, and everyone in the USA already has "Free Credit Monitoring" anyway. For leaking all of my personal details, I'd love to be paid for the time and money I've had to spend cleaning up their mistakes after Equifax hired a music major as the head of Information Security.

> It should be law that lawyers can't have more than something like 5% of the settlement

The settlement wasn't even cash, though. Did the lawyers get paid in V-Bucks? They should have been.

> Class action lawsuits are turning out to be a scam.

Anybody have a good idea of what proportion of class action lawsuits end up as "bad/not good enough for class members?"

Because anecdotally I think of a couple that had fairly reasonable-sounding payouts for class members. One was the Dow Corning breast implant settlement that ended up bankrupting Dow Corning and resulted in payments of $12,000 to $300,000 to class members depending on the exact symptoms suffered. Another was Collins v. United States which was settled for full back pay for all U.S. military veterans discharged under Don't Ask Don't Tell since 2004.

The anti-poaching class action settlement also paid me a handsome, if not enormous, sum for depriving me of the opportunity of working for companies that I had no intent of working for.

> It should be law that lawyers can't have more than something like 5% of the settlement

Then finding a lawyer willing to go through the long and complex class action lawsuit will be even harder and/or more expensive, resulting in fewer class-action suits, meaning the punishment for these scams will be even more unlikely than it is now.

Even if lawyers got 100% of the settlement, class actions would still be worth it as deterrent.

But this isn't a punishment at all. I just don't believe that it's not possible to more closely align the interests of class action lawyers with that of the classes they represent. It doesn't seem like it's difficult to find lawyers willing to initiate class action lawsuits today. They just never seem to amount to much more than a pay day for the lawyers.

> I just don't believe that it's not possible to more closely align the interests of class action lawyers with that of the classes they represent.

But how does capping the settlement % that goes to the lawyers achieve that?

Yeah, I'm not sure that's the right solution either. Perhaps there could be a third party "class advocate" that receives 1% of all proceeds awarded to the class in the case of a settlement or trial victory who has unilatteral power to veto any settlement agreement. Then their incentives would be aligned to ensure the maximum settlement while taking into account the probability of winning in court and the costs of prolonged delay, etc. If the class gets nothing, the class advocate gets nothing. If the lawyers make bank, but the class gets a pittance, the class advocate gets a pittance. The class advocate could also negotiate reasonable attorney fees for the class.

correct: right now the interests of the lawyers are aligned with the people they're suing, not the people they're representing.

Turning out? These lawsuits have been seen as "lawyers make millions, you get a coupon for your suffering" for many years now.

I remember discussions of this back on Slashdot during the Zip Drive click of death lawsuit where I eventually got a coupon for like $10 off my next IOMega purchase or something. Total bullshit.

The counter argument is that the companies need to be punished for their behavior, even if the victims aren't the ones who get the compensation in the end. I've thought that seems rather mercenary.

There was a "take the cash" option for that Equifax settlement, but nobody I know who opted for that ever saw a dime. I think they eventually weaseled out by saying that you had to prove in arbitration you were financially harmed by the breach to receive the cash or something.

Hey! That "music major" must have at least been well connected! She was just "managing" people anyways; not like she needed to know what she was doing.

Many of the best developers I can think of didn't major in cs; many didn't go to university at all.

I wasn't even able to get the free monitoring, they intentionally broke their website to not work

I agree, they seem to be a scam that once again benefits the rich (lawyers) over the poor (class/clients). More often than not I see the US courts as an extension of elitism and crony capitalism than a system of serving justice. Maybe that's vastly oversimplifying things, but I'd like to see a reasonable justification for this seemingly despicable process of lawyers getting rich off the backs of victims they represent.

>I agree, they seem to be a scam that once again benefits the rich (lawyers) over the poor (class/clients).

Can you elaborate on this? The ones being paid are "the rich", but so are the people paying. The poor aren't getting much out of this, but it's not like they were going to get anything without a class action. After all, if you thought you could get more, you can always opt out of the class action and sue individually.

Sorry I'm a couple of days late for this reply. The goal (or should be the goal) of a class action lawsuit is financial reparations to victims of wrong-doing. An example being faulty vehicle components as a result of manufacturer negligence leading to death or injuries. In this example, the lawyers are making millions off the lawsuits and most likely the victims are getting a very small payout at best. The company gets a slap on the wrist. From what I understand, opting out and suing individually comes with additional obstacles (and potentially less payout) for the legal team and client. When I refer to "the poor" I'm talking about the bottom 90% of income earners that typically make up the pool of "victims" exercising the class action suit.

Interesting side-note - as a minor who plays the game, Epic is essentially discouraging you at all from participating in the cash-sided part of the settlement with the follow-up of contract stipulation - if you request cash due to being a minor at the time of playing, Epic will force you to close your Epic Games account, across all games.

We really need more robust consumer protections for digital goods. This is like asking you to return every product you bought at WalMart with no compensation as a condition for accepting a settlement from a WalMart class action suit.

Likewise, getting an account banned for ToS violations at a storefront such as the App Store should not immediately strip you of all goods purchased on that storefront.

They are obligated to allow refund by contractual disaffirmation, which must negate the contract in whole.

It also makes sense that Epic also requires a subsequent replacement account to be opened by a non-minor.

...but I'm sure the lawyers who brought the case aren't being paid with in-game currency, amiright?

that's what the 25M in real money is for. Pay the lawyers and the ridciulously small number of people who will fill out and submit a claim. You can't make this stuff up; the only way it could be more over the top would be if the settlement was for "get a 20% bonus on all new V-bucks purchases!"

How many loot llamas does it take to buy a suit or a rolex?

We'll just award each lawyer with an in game Tom Ford suit and an in-game Rolex.

Loot llamas are the loot boxes. VBucks is the currency.

Reminds me of the airline antitrust suit in the early 1990's. The settlement was 10% discount coupons (AirScrip) for seven of the airlines that were involved.

Two airlines that weren't part of the suit (Alaska and America West) agreed to accept the coupons since they didn't want to get left out.

This same Epic that is screaming to the world how Apple and Google are so bad boys.

Good example of dual morals.

Never let yourself become loyal to a company. Companies are motivated by profit. The only "support" you should ever give a company is payment in exchange for a product or service. Bad companies support plenty of good causes. Support those causes, but don't confuse that with support for the company itself.

I agree with Google about link taxes being bad, but I do not support Google itself.

I agree with Apple about Facebook's privacy violations being bad, but I do not support Apple itself.

I agree with Epic about Apple's restrictions regarding what users can do with their devices being bad, but I do not support Epic itself.

Companies are not heroes.

It’s not that simple - if you ‘agree’ with these companies, then you are agreeing with their self-serving framing, and supporting them.

You might think there are problems with each company (I certainly do), but that doesn’t mean I need to agree with them in any way.

Just because it's self serving doesn't mean it's wrong. They can reach the right conclusion for the wrong reasons.

Possibly, but extraordinarily unlikely.

They are working backwards to conclusions that benefit them in particular, and framing the problem in those terms.

That is of course the right conclusion for them.

The chances are that those are the right conclusions for everyone else, are next to zero, since they have a systematic bias against reaching such a conclusion.

Also if their reasons are wrong, then their conclusion will be framed wrongly.

We do sometimes say someone did the right thing for the wrong reasons, but by definition we never say this while still ourselves buying into the logic they used to get there.

> they have a systematic bias against reaching such a conclusion.

No they don't. They have a bias for reaching conclusions which benefit them. Full stop. Those conclusions may coincidentally benefit others, even if that was not part of their motivation.

What would you suggest? We should be in favor of a link tax purely to spite Google? We should surrender our privacy to Facebook just to stick it to Apple? We should protect Apple's ability to restrict what users can do with their devices as a display of contempt towards Epic?

> What would you suggest? We should be in favor of a link tax purely to spite Google? We should surrender our privacy to Facebook just to stick it to Apple? We should protect Apple's ability to restrict what users can do with their devices as a display of contempt towards Epic?

Bizarre - I’m not sure what these suggestions have to do with me.

Epic doesn’t care about protecting users rights to do what they want with their devices.

Nothing they are proposing is about that.

All they are proposing is that they should be able to get a cut.

If Epic gets to run an App Store or payment gateway, Apple’s platform will still limit what users can do with their devices, so we can see that they don’t care about that.

Personally, I am happy for Apple’s customers to choose a closed platform if they like.

But, I am not happy that we have no open alternative.

Google promised us one, but reneged on that promise. Remember ‘open always wins’?

I don’t think it’s Apple’s responsibility to provide people with an open platform, nor do I think we should force our views on people who want a curated platform.

I think it’s up to the rest of us to build an open platform, if we want one.

‘The rest of us’ would include Epic, if they had an interest in user freedom.

> Epic doesn’t care about protecting users rights to do what they want with their devices.

I never said they do. They want users to be able to install iOS apps on from third party sources. Their motivation is that they simply want to avoid paying Apple's App Store fees. Our causes are aligned even though their intentions are entirely self-serving. They reached the right conclusion for the wrong reasons.

> they simply want to avoid paying Apple's App Store fees

This is often repeated on HN, but is not true. They want a cut of those fees for themselves, which is why they want to run their own store and payment mechanism.

This is definitely no more aligned with the users than Apple.

Arguably it’s less aligned, since they don’t care what users experience with the platform is.

> they want to run their own store and payment mechanism.

...which would require Apple to allow iOS users to install apps from third parties, right? How is that less aligned with users than Apple? What Epic plans to do once Apple's policy changes is irrelevant.

Firstly, a lot of users don’t want multiple stores.

Therefore it simply isn’t in the interests of users in general.

That statement is false.

Secondly, which third parties would be allowed? What kind of stores?

It’s pretty obvious that there are many answers to these questions that would not be good for users.

So no, what Epic wants is definitely not ‘in the best interests of users’.

As I have said all along - it’s in the best interests of Epic, and nobody else.

If we want to think about what is in the best interests of ‘users’ that is a very broad and interesting space.

And as I have pointed out, imagining that we ‘agree’ with Epic on this, just means that we are supporting them and what they want.

Consider for a moment that what is in the best interests of users might have nothing to do with Apple, or the App Store.

I'll reply with a straightforward approach: "Reward good behavior. Punish bad behavior."

Really it's that simple. There are no absolutely "good" humans or companies. They only have good and bad actions.

If the action is good short-term but bad long-term, then the decision becomes more interesting/difficult, but is still a decision on the action, not the reasons.

> They only have good and bad actions.

Do they?

Who decides which actions are good and which are bad?

Presumably at the very least someone who understands the actions.

Without understanding the reasons for actions, we can only partially decide whether they are good or bad, because we cannot fully understand the actions themselves.

My point is, you will never know the reasons. Support the good behavior (and vice-versa). Shallow? Yes. Effective? Also yes.

I dislike Epic's approach to buying exclusivity and how it restricts consumer choice.

I like Epic's challenge of the mandatory app store and what it means for making mobile phones closer to real general purpose computing.

Don't expect consistency from companies, just treat them as actors with their own interests which sometimes align with yours and sometimes do not.

> I like Epic's challenge of the mandatory app store and what it means for making mobile phones closer to real general purpose computing.

Ironically I dislike Epic’s challenge because I think it will take us further away from a healthy general purpose computing platform.

Bad boys can still point out when others are behaving poorly, right?

Tim sweeney is just a big asshole to be frank

"Apple won't let us do illegal gambling on their device. This is illegal monopoly!"

Imagine thinking that Epic's line of business is even half as impactful or important to the world as what Apple and Google provide.

One of them makes games, the other two maintain a technological oligarchy that oversees our access to the entire population of smartphone users.

A car dealership might rip me off, but if car dealerships start pushing for a 3 or 4 day work week I'll be their best friend. (The car dealerships representing Epic and the soul sucking 5-day work week representing Apple and Google.)

Is it possible to liquidate in-game currency for cash at the same price it would've cost to purchase it to begin with? If not the settlement cost Epic basically nothing.

Hey now, it probably cost a couple of man hours to compile the lists and some compute time on the database cluster.

No, it's not - but you can buy funny dances with it!

The best part is that they will shut down this game once people move on to something else and it's no longer profitable

Can someone explain to a non-gamer what this is all about? Specifically, what's the legal issue here? The article doesn't really say.

Was Epic lying about the probabilities of getting rare items in these loot boxes? Or is it because "gambling" was marketed to children, in general? If the latter, why is this any different from similar non-online activities, like sweepstakes and raffles for children's toys?

They were encouraging children to gamble with real money.

I don't know how every MMO operator isn't clenching their butts at the outcome of this lawsuit. There are loads of Korean MMOs that really only have two things: Grind and Gamble Boxes. Three things if you count the Anime titties.

What an absolute travesty. Epic is running a casino, encouraging players to gamble, but not for something of value, but an infinitely repeatable digital good. To be able to "pay off", if you could even go as far to call it that, in digital goods at effectively no cost to them then we're just encouraging further bad behavior.

Don't let the drama fool you though. Epic only had those RNG loot boxes in the "Save the World" Fortnite game which is entirely different from the actual popular phenomena that is the battleroyal one. That and on Rocket League which they bought in that state while they were only implementing the standard TF2/Valve model of lootboxes. And when bought they made them switch to a non lootbox model.

As such, that class action lawsuit is rather clickbait by itself. It rode on the popularity of "Fortnite BR" to make it look like Epic was selling tons of lootboxes to kids when the reality is they had so few players of Save The World it probably had a rather insignificant impact on kids getting exposed to gambling.

At least in a casino they comp you physical goods and services that have a real value. Who knew the mob and wall street were the good guys?

I thought this was an Onion article. Wow.

Is there any effect on the game industry as a whole here? As far as I can tell, Overwatch has exactly the same loot box model. Is anyone suing Blizzard over this? Or is there some particular miniscule detail that made Epic's actions illegal, but selling randomized loot boxes in general is still OK?

I don't see why they'd be able to do this, considering that one of the main arguments for why lootboxes and virtual currency don't count as gambling is that they have no monetary value.

Consider the two cases. If loot-boxes have no monetary value, then Epic won't be losing any monetary value in the settlement. If loot-boxes do have monetary value, then Epic should pay, and loot-boxes should be a valid form of payment. ;)

There seem to be two beneficiaries from such class action cases: Lawyers who get paid, and prosecutors who get publicity.

The deterrent effect on the guilty party is negligible, and the benefit to the public is nil.

Class action lawsuits should require a "class advocate" who is only paid a flat percentage of the total amount awarded to the class in a settlement or court victory. The advocate would represent the class and would have the power to hire, fire, and negotiate compensation for any lawyers, and any settlement would require the advocate's approval.

The advocate could choose to fork over half of the settlement to the lawyers if they judge that that is it what is necessary to win, but they could also negotiate lower fees or hire another firm if they believe the lawyers are charging exhorbitant fees or otherwise not representing the best interests of the class.

HT @MikeUt https://news.ycombinator.com/item?id=26238726

Since this is a settlement, the court has nothing to say about it. It's entirely a private deal between the lawyers, who on one side are wholly failing to represent the plaintiffs.

Epic got off practically for free, and have probably already hired the nephews of the opposing lawyers.

Those lawyers should be disbarred.

A solution might be to require the lawyers to take payment in whatever the injured parties got. But since legislators are mostly lawyers, don't expect anything to be changed about this sort of cushy arrangement.

Ticketmaster lost a class action suit in 2016, but managed to be allowed to pay the customers it unfairly charged not in money, but in coupons for Ticketmaster.


Ethics of paying off class actions with promotional/discount rewards aside, I'm kind of surprised they did settle. While many EU regulators have held loot boxes to be in violation of rules regarding licensed gambling or marketing gambling to kids, I'd always assumed the US would be more open to letting whales be eaten by the sharks based on their attitude towards free markets.

Class action lawsuits rarely go to trial. Did you note the 25 million in real cash that's included? The settlement is camouflage for the true goal, which was getting big fees for the lawyers. Their strategy is to take these cases as close to trial as possible without ever having to prepare for a courtroom. They ran this one to perfection.

While this is probably not the case, this could be a subversive attack on potential competitors if Epic is planning to release a MMO in the near future that doesn't have Gamble Boxes. Many many competitors would be in danger of a similar lawsuit and could find themselves cut off at the knees right as Epic launches their own MMO or F2P mobile game.

This is probably too Machiavellian, but it's not like the industry isn't rife with Gamble Boxes. There are a lot of companies that are basically dependent on gambling for the majority of their income.

Of course they settled. The only way the settlement could have been more favorable for them is if the plaintiffs agreed to pay Epic.

If there's a chance of setting a poor precedent for them, even a minuscule chance, they'll often settle after racking up the opponent's legal bills.

American citizens attitudes and what our political/court system do are often very different.

Misleading, baity headline.

Yes, the in-game currency settlement is awful, but the Ars Technica headline writer is making it sound more awful than it really is, because, quote:

In addition to the virtual currency, Epic will also be providing "up to $26.5 million in cash and other benefits to U.S.-based Fortnite and Rocket League players" to settle the claims.

Nonsense, it's a perfectly valid headline. The lawyers get first dibs on that $26.5M, players mostly get in-game currency.

> Each Settlement Class Member who timely submits a valid Claim Form will be entitled to receive their choice of either a cash award (up to $50 ...

The claim form isn't posted yet on the website. It has to be physically mailed in to the lawyers, with all your personal info. Of 10 million Rocket League and Fortnite players, how many do you think will actually mail that in? They're betting it's less than 1 in 20. I'd wager it's going to be more like 1 in 2000, which costs Epic just $0.25M, leaving $26.25M for the lawyers.

> Upon receipt of a Claim Form, the Settlement Administrator will determine your eligibility to receive an award. Depending on the number of Approved Claims, it is possible that each Settlement Class Member’s award will be reduced on a pro-rata basis after payment of settlement administration costs, attorney’s fees and expenses, and Incentive Awards to the Plaintiffs.

Even if the number of approved claims is not already small, the cash is for the lawyers first, Epic is paying the players primarily with in-game currency.


You make a good point, but for cash benefit, each individual person must fill out the claim form at [0]. It's not clear up front how Byzantine that process might be, but they're at least asking for detailed documentation of records Epic must already have on file. Payments are capped at $50 per person. $26.5 million is merely an upper limit on the total of all payments, but that requires at least 530,000 people successfully completing max-value claims.

0: https://www.epiclootboxsettlement.com/Home/SubmitClaim

>In addition to the virtual currency, Epic will also be providing "up to $26.5 million in cash and other benefits to U.S.-based Fortnite and Rocket League players" to settle the claims.

How much did the lawyers get paid?

"Even though it's settling a US lawsuit, Epic says this same deal will apply to all Fortnite players globally."

They wish! This can be no more than an offer which must be accepted before it "applies". I just don't know if anyone will actually bring this to court rather than accept the offer.

I thought this was a joke, sounds like the premise for a south park episode.

Maybe if loot-boxes are considered gambling it is because the digital asset has monetary value, therefore it could be used as reimbursement in this case? shady

What's the actual claim behind the lawsuit?

I hate lootboxes, but what's the basis for damages?

That loot boxes are the same as gambling, and encouraging minors to gamble.

> Epic was faced with a class-action lawsuit alleging, among other things, that it had "psychologically manipulate[d] its young players into thinking they will 'get lucky.'"

I guess I'm surprised that's illegal? They're hardly the only loot box offering company

So as "punishment", Epic has to "pay" users in a fake currency which can only be redeemed for a limited set of Epic products and whose value is artificially controlled by Epic themselves. This sounds more like a marketing campaign than a legal settlement.

Can I pay my taxes with special in-country vouchers?

wow.. I'm sure many companies facing class action law suits would love to reimburse people with in-store vouchers..

How is this legal ? Isn't the whole loophole around in-game currency not receiving gambling regulation is because the currency is NOT redeemable ?

> How is this legal ?

Because this is a settlement of a lawsuit, rather than an independently-triggered regulatory action.

The lawyers and representative plaintiffs may agree to this because an in-game-points payment inflates the notional value of the settlement and thus the legal fees, but that group would be paid in cash based on a fraction of the settlement value.

Do they also pay employees with company scrips?

The degree of 'unethical' at play here is nothing short of epic.

Applications are open for YC Summer 2021

Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact