April 23, 2012
SuperPoke! Pets Virtual Gold Dispute Worth Over $5 Million--Abreu v. Slide
By Eric Goldman
Google bought Slide, which operated the SuperPoke! Pets online game. Wikipedia has some of the game's history. As part of the gameplay, users could buy virtual gold. Apparently a lot of them did; Google alleges that users bought $6M+ of virtual gold from October 2010 through June 2011. The plaintiffs allege that Slide whipsawed its users. After exhorting users to buy virtual gold, in June 2011 Slide stopped selling virtual gold and wiped out existing gold accounts, but it said the site was ongoing and told subscribing users they could enjoy premium accounts for life. Then, in August 2011, Slide announced a hard stop in 6 months, and Slide actually shut down in March 2012. By shutting down, the plaintiffs allege that Slide improperly wiped out virtual assets worth real money.
I'm torn about the underlying merits of this dispute. I'm sure Google has good explanations for the choices it made, and I staunchly defend the right of virtual world operators to control their environments as they see fit. Still, it's bad for consumer trust and the industry generally for Slide/Google to eliminate virtual assets that people bought with real money without providing some refunds, even if Slide made disclosures up the ying-yang about caveat emptor. We'll get to those more interesting questions later (if the case doesn't settle).
For now, the only issue in this ruling is whether the case stays in federal court or goes back to state court. To stay in federal court under CAFA, the case must meet certain standards, including having an amount in controversy over $5M. Google argues that it clears the threshold because users bought over $6M of virtual gold. The court says this allegation suffices, the plaintiffs can't adequately rebut it, and the case stays in federal court per CAFA.
Both Venkat and I wondered if Google's declaration of the $6M+ number will eventually come back to haunt Google. Neither of us couldn't think of a way it would. I imagine Google is going to argue that consumers got what they paid for, so the fact that there's over $6M in revenues is ultimately irrelevant.
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