Valve Hit with $900 Million Lawsuit Over Alleged PC Gaming Monopoly Practices as UK Court Allows Case to Proceed

The UK Competition Appeal Tribunal has greenlit a lawsuit set for 2024 that accuses Valve of leveraging its dominant position in the PC gaming market to inflate prices for games and downloadable content (DLC). The lawsuit is aiming for a hefty payout of £656 million (around $900 million) on the claim that up to 14 million UK gamers may have overpaid between £22 and £44 for games during the specified timeframe starting June 5, 2018.

The case gained traction in June 2024 when Vicki Shotbolt, who identifies as a prominent advocate for children’s digital rights, stepped forward to act as the proposed class representative. She is associated with the group “Steam You Owe Us,” which emphasizes that she will not profit from pursuing this claim in court.

In a ruling on January 26, the tribunal, led by The Honourable Mr. Justice Hildyard, Paul Lomas, and John Davies, decided that the lawsuit could move forward. This ruling does not imply any judgment on the merits of the case; it simply means the case is not dismissed.

The tribunal stated, “For the above reasons, we conclude that the Pro-Sys Test is met and that the collective proceedings can be effectively tried as regards the PPO Issue.”

To break this down, Shotbolt and her legal team argue that Valve’s practices hinder game publishers from offering their titles, add-ons, and DLC at lower prices or earlier release dates on other digital platforms. They contend that additional content is locked to games purchased on Steam, preventing access to content bought elsewhere. A significant part of Shotbolt’s argument revolves around the platform parity obligation (PPO) terms, which allegedly restrict options through alternative sellers, along with the standard 30% commission Valve takes from Steam sales.

Valve contended that the case should not advance to trial, claiming the anti-competitive allegations lacked substance and that much of the evidence was based on comparisons with different markets, such as e-books. However, the tribunal has allowed the case to proceed.

A key point of contention is the role of Steam keys, which are often sold on third-party sites like Humble and Fanatical. Valve argues that these keys mitigate the impact of its commission and facilitate off-platform sales. They also assert that the plaintiffs have not adequately demonstrated how Steam keys affect Valve’s commission or shown that game prices would have decreased without the PPO clauses.

The tribunal dismissed Valve’s argument regarding Steam keys, stating, “We were not persuaded by Valve’s attempt to position the Steam Keys issue by reference to individual Steam Partners (or Games). That would render any such abusive pricing claim next to impossible to bring.”

If this situation seems convoluted—between pricing authority on Steam, the calculation of Steam keys, and how compensation would be assessed—it’s because it is indeed complex.

The tribunal, assessing the case against the dual standards of the Pro-Sys Test (or, humorously, the Microsoft Test), found sufficient grounds regarding “unfairness” and “excessive pricing” to allow the lawsuit to proceed to trial. Now, it must withstand scrutiny.

“We do not underestimate the challenge of demonstrating, at trial, that the PPOs had an effect on the competitive structure of the market such as to constitute an abuse of a dominant position or of attributing a price impact to that effect, even with a broad axe, to estimate the damages due. However, we are at the certification stage,” the ruling states.

In a separate case, a former MMO developer was found to have hacked 68 players to steal in-game gold valued at over $700,000, selling it for Bitcoin. A UK court has ruled that this in-game gold is legally considered “property” and can be stolen.