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I am not your attorney; you are not my client; you would be stupid to rely on legal advice you find on the internet.
So, this whole Diablo 3 Real Money Auction House got me wondering whether it was actually legal what Blizzard is doing. Just as an intellectual exercise, I was thinking of what claims could be made by crafty attorneys against Blizzard in a class action lawsuit. After thinking about it awhile and reviewing some claims online, I began to think that legitimate claims could actually be made. I discussed this with a partner at my law firm to see if they were actually interested in filing a lawsuit since it seems easy money can be made off of it. He declined for reason unrelated to the merits and I am not dumb enough to go out on my own. However, I thought it would be fun to discuss my thoughts (and some ramblings) with the interwebs.
First, the easy claim: False Advertising.
If you bought the box like I did, it will say "Trade the Spoils of War. Use the Real Money Auction House to buy and sell items for real world currency. Then draw on your earnings to buy ever more powerful items or cash out your trades, take the money, and run. The choice is yours."
Here is a picture.
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![[image loading]](http://s2.hubimg.com/u/6647289_f520.jpg)
So, whats the problem? The game doesn't include RMAH without additional purchase (at least for some people). After the game was released, Blizzard (after multiple snafus) decided that an authenticator was required for the RMAH to prevent further snafus on their part.
Here is the announcement.
In preparation for the upcoming launch of the real-money auction house, we will be making some key changes related to the account-security measures required to use Battle.net Balance. Later today, the following updates will be made to the Terms of Use available on our website, and when the real-money auction house goes live, all players will be asked to re-read and accept these changes the next time they play Diablo III.
Battle.net Balance and Authenticator Update
With the introduction of the real-money auction house, account security will become more important than ever. To help ensure that players have a positive experience when using the real-money auction house, we’ve made some adjustments to how players can use and access their Battle.net Balance.
Starting today, in order to add to your Battle.net Balance, players will be required to have a Battle.net Authenticator or Battle.net Mobile Authenticator attached to their Battle.net account. For clarity, this means you’ll need to have an Authenticator to add to your balance via Battle.net Account Management or to send the proceeds of your real-money auction house sales to your Battle.net Balance.
Please note that players who previously added Battle.net Balance to their account prior to this change will be able to use it to make eligible purchases on Battle.net and in the auction house without attaching an Authenticator. However, an Authenticator will be required to add to your balance in the future, as explained above.
While we understand that this creates an extra step for players during the login process, we believe this added layer of account protection will help foster a safer auction house environment for all of our players.
You can learn more about the Battle.net Authenticator, Battle.net Mobile Authenticator, and other account security information by clicking here.
Battle.net Balance and Authenticator Update
With the introduction of the real-money auction house, account security will become more important than ever. To help ensure that players have a positive experience when using the real-money auction house, we’ve made some adjustments to how players can use and access their Battle.net Balance.
Starting today, in order to add to your Battle.net Balance, players will be required to have a Battle.net Authenticator or Battle.net Mobile Authenticator attached to their Battle.net account. For clarity, this means you’ll need to have an Authenticator to add to your balance via Battle.net Account Management or to send the proceeds of your real-money auction house sales to your Battle.net Balance.
Please note that players who previously added Battle.net Balance to their account prior to this change will be able to use it to make eligible purchases on Battle.net and in the auction house without attaching an Authenticator. However, an Authenticator will be required to add to your balance in the future, as explained above.
While we understand that this creates an extra step for players during the login process, we believe this added layer of account protection will help foster a safer auction house environment for all of our players.
You can learn more about the Battle.net Authenticator, Battle.net Mobile Authenticator, and other account security information by clicking here.
http://us.battle.net/d3/en/forum/topic/5594218404
So what? Well, for those of us who don't have smart phones (authenticators are free for smartphone users), we have to purchase an additional $8 physical authenticator to use what is advertised on the box as included in the game. That, my friend, is fucking illegal.
It violates the California Consumer Legal Remedies Act, Cal. Civ. Code section 1750 et seq., which states:
(5) Representing that goods.. have ... characteristics, ... uses, benefits, ... which they do not have ....
(9) Advertising goods or services with intent not to sell them as advertised.
(9) Advertising goods or services with intent not to sell them as advertised.
It violates the California False Advertising Law, Cal. Bus. & Prof. Code section 17500 et seq., which states:
It is unlawful for any person, firm, corporation or association, or any employee thereof with intent directly or indirectly to dispose of real or personal property or to perform services, professional or otherwise, or anything of any nature whatsoever or to induce the public to enter into any obligation relating thereto, to make or disseminate or cause to be made or disseminated before the public in this state, or to make or disseminate or cause to be made or disseminated from this state before the public in any state, in any newspaper or other publication, or any advertising device, or by public outcry or proclamation, or in any other manner or means whatever, including over the Internet, any statement, concerning that real or personal property or those services, professional or otherwise, or concerning any circumstance or matter of fact connected with the proposed performance or disposition thereof, which is untrue or misleading, and which is known, or which by the exercise of reasonable care should be known, to be untrue or misleading, or for any person, firm, or corporation to so make or disseminate or cause to be so made or disseminated any such statement as part of a plan or scheme with the intent not to sell that personal property or those services, professional or otherwise, so advertised at the price stated therein, or as so advertised.
It violates the California Unfair Competition Law, Cal. Bus. & Prof. Code section 17200 et seq., which states:
As used in this chapter, unfair competition shall mean and include any unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising and any act prohibited by Chapter 1 (commencing with Section 17500) of Part 3 of Division 7 of the Business and Professions Code.
And, it is also arguably a breach of contract and breach of warranty. Although this becomes more tricky because of the terms of service you agree to when you use the game for the first time. Of course, terms of service don't allow Blizzard to lie to you when you purchase the game and then force you to waive their fraud when you want to use the game.
So, what does this mean? It means you may be entitled to a full refund of your game (and potentially the authenticator as well). Blizzard may be subject to civil penalties (if the California Attorney General or District Attorneys get involved). You can potentially recover all of your attorneys' fees if you are successful. And, you can totally fuck Blizzard in the ass for this bullshit.
Now, so far this has seemed pretty straightforward, but my mind wanders, and I wonder, can they really do this RMAH thing when they control the market?
Some background. Blizzard gets $1 for each transaction on the RMAH. It makes it money based on the number of transactions, not the amount of the transaction. So, its in Blizzard's benefit if there are more transactions and at lower cost (more likely that people will buy a lower priced item). Users obviously make more money if the transaction is higher priced (covers the transaction fee and gives them the remainder) and there are less transactions (keeps prices on items high). Got it? Good.
Well, if you are Blizzard, how do you get more transactions for lower amounts? You make it easier to get high level (ilvl 61-63) drops, which are what people want to buy. That reduces the price on the items and makes more of them available on the market. How does that affect you? It means items you find are worth less over time because of the influx of new items especially considering the farmers who do nothing but search for items to sell.
Wait, wait, wait. Blizzard wouldn't fuck us like that, right? What do you think?
We’re shifting to a philosophy where the best items in the game can drop from many different places, so a wider variety of play styles are viable. If you would rather chain-pull elite packs in Act I than 3 minute cat-and-mouse in Act IV, we'd like you to be able to do that and know you can still find the best items in the game.
http://us.battle.net/d3/en/blog/6262208/Patch_103_Design_Preview-6_6_2012
Is that illegal? I actually don't know. I was going to research this if the partners gave me the go-ahead. But consider this, state and federal antitrust laws prevent companies from manipulating the market to increase their profits. Isn't that what Blizzard is doing? They are manipulating the item drops, which will increase the number of RMAH auctions, lower those prices and increase their profits, all at the cost of the people who do the work to find the items.
wait, wait, wait. Freak, you are paranoid. Well, maybe (especially since i am talking to myself in my blog), but if I was paranoid, I would argue that Blizzard's employees were selling items on the RMAH auction house. Wouldn't that be funny.
Anyways, I will end my ramblings. Just food for thought.
