Fun With Sports Law: Video Game Edition

Have you bought a new copy of Madden or NCAA Football since 2005?  If so, you stand to make some free money.  A couple of dudes from California filed an class action antitrust lawsuit against EA Sports, the company that produces these two video games.

Unlike the famous American Needle case, where the plaintiff was a small family-owned company that got squeezed out of the football merchandise industry by the NFL's exclusive licensing agreement with Reebok, these two gentlemen claim that the NFL's exclusive agreement with EA Sports resulted in a higher video game price for consumers.  They may or may not win (depending on the outcome of the rule of reason test) but all sports fans should thank American Needle for preserving their opportunity to win.  Had American Needle lost its case at the Supreme Court, professional sports leagues would have had free reign to exclusively license anything it wanted to anybody at all.  Imagine $50 baseball caps, $125 video games, and $800 Sunday Ticket.  Not a pretty sight.

At this point, you're probably thinking, "You said something about free money?"  Right.  If you bought a new copy of Madden or NCAA Football since January 1, 2005, you are automatically a member of the class action lawsuit.  And if you're a class member, it's probably best to do nothing.**  The only real advantage of opting out of the class (rather than staying in) is being able to file your own antitrust lawsuit against EA Sports on the same grounds.  I don't expect many of you to go that route.

So, assuming you remain in the class by doing nothing, a small army of lawyers will represent you and the literally millions of other plaintiffs around the country.  In a few years, the case will probably settle, and the court will probably approve the settlement.  How much do you stand to "earn?"  Well, suppose it settles for $20 million.  The attorneys will get their twenty-five percent cut, or $5 million.  That leaves $15 million for roughly 10 million video game owners.  You can expect to receive a compensation check for $1.63 in ohhh, I don't know, about four years.  Isn't the American legal system just the best?!

**In no way does this constitute legal advice. If you're seeking legal advice on this matter, you should consult an attorney licensed in the jurisdiction in which you reside.

For your convenience, here is a copy of the email that our own Andrew Katz forwarded me last night:

GEOFFREY PECOVER and ANDREW OWENS v. ELECTRONIC ARTS INC.
U.S. District Court (N.D. Cal. - Oakland Div.)
Case No. 08-cv-02820 CW

If You Purchased Certain Electronic Arts Brand Football Video Games
Between January 1, 2005 to the Present
You May Be a Class Member.

Membership as a class member in the Electronic Arts Litigation is the result of a lawsuit filed in the U.S. District Court, Northern District of California, Oakland Division (Case No. 08-cv-02820 CW).

What Is This Class Action About?

The class action lawsuit alleges violations of California's antitrust and consumer protection laws in connection with the sale of certain football video games. Plaintiffs, purchasers of Electronic Arts' football video games, claim that Defendant Electronic Arts entered into a series of exclusive licenses with the National Football League (NFL), National Football League Players' Association (NFLPA), National Collegiate Athletics Association (NCAA), and Arena Football League (AFL), which Plaintiffs claim foreclosed competition in an alleged football video game market. Plaintiffs allege that this series of exclusive licenses caused customers who purchased certain football video games to be overcharged.

Defendant Electronic Arts has denied any liability and all allegations of misconduct. The Court has not decided whether the Defendants did anything wrong, and this Notice is not an expression of any opinion by the Court about the merits of any of the claims or defenses asserted by any party to this litigation.

Who Are Class Members?

The Class includes all persons who, during the period January 1, 2005 to the present, purchased the Madden NFL, NCAA Football, or Arena Football League brand video games published by Electronic Arts with a release date of January 1, 2005 to the present. Excluded from the class are purchasers of software for mobile devices, persons purchasing directly from Electronic Arts, persons purchasing used copies of the relevant football video games, and Electronic Arts' employees, officers, directors, legal representatives, and wholly or partly owned subsidiaries or affiliated companies.

What Should I Do? (Getting Further Information)

If you believe that you may be a class member (see above "Who Are Class Members"), you should get more detailed information about the class action and its potential effect on you and your rights. Further information can be obtained by going to the following website: www.easportslitigation.com. Additional information about the lawsuit may be obtained from Plaintiffs' Counsel website at www.hbsslaw.com, or by calling Plaintiffs' Counsel at 1-206-623-7292.

To Remain a Class Member

If you are a class member and you do nothing, you will be bound by the court's rulings in the lawsuit, including any final Settlement or Judgment.

To Exclude Yourself from the Class (Deadline to Request Exclusion: June 25, 2011)

If you are a class member and you want to exclude yourself from the class and keep your right to sue Defendant, you must take further action before June 25, 2011. By that date, you must request exclusion in writing to this address:

Electronic Arts Litigation Exclusion
P.O. Box 8090
San Rafael CA 94912-8090

Or submit a request for exclusion electronically at the following website: www.easportslitigation.com

For further information about excluding yourself from the class go to the following website:
www.easportslitigation.com

Please do not telephone or address inquiries to the Court.
April 6, 2011. By Order of the U.S. District Court (N.D. Cal. - Oakland Div.).