Damion Perrine v. Sega of America, Inc., et. al. U.S. District Court, Northern District of California Case No. C: 13-1962 MEJ

In April 2013, Damion Perrine filed a class action lawsuit against publisher Sega of America, Inc., (“Sega”) and developer Gearbox Software, L.L.C., (“Gearbox”) in response to the February 12, 2013, release of Aliens: Colonial Marines. The game in question was marketed as the canon sequel to James Cameron’s 1986 film Aliens and garnered much media attention up to its release. The complaint alleges that Gearbox and Sega falsely represented the quality of the game at industry trade shows and media preview events through deceptive trailers and screenshots. These alleged misrepresentations began in June 2011 and continued until the game’s release. Perrine alleged that even though trailers and screenshots bore watermarks stating the game was still a “Work in Progress” it was reasonable to expect the game to at least live up to the standards shown therein.

The complaint put forth six causes of action: violation of California’s Consumer Legal Remedies Act (Cal. Civ. Code §1750); violation of California’s Unfair Competition Law (Cal. Bus. & Prof. Code §17200); violation of California’s False Advertising Law (Cal. Bus. & Prof. Code §17500); breach of express warranties; fraud in the inducement; and negligent misrepresentation. The complaint alleged these representations were deceptive and intentionally done to induce consumers to purchase the game. The complaint also states that Sega and Gearbox knew they made representations of quality and features that they either knew they could not or would not live up to. The suit seeks relief in the form of a declaratory judgment stating that Sega and Gearbox violated the listed statutes and that their actions constituted fraud in inducement and negligent misrepresentation. Furthermore, Plaintiff, on his own behalf and on behalf of the class, sought damages as well as an injunction against Sega and Gearbox “as necessary to cease Defendants’ violations” of the various statutes that were allegedly violated. Lastly, Plaintiff sought restitution in the form of disgorgement of all revenue derived from sales of Aliens: Colonial Marines. In May 2013, the magistrate judge denied class certification without prejudice for failure to comply with California Civil Local Rule 7-2(a).

On June 5, 2015, the parties advised the court that they had agreed to a settlement of the case. The District Court therefore dismissed the cause of action without prejudice provided that a valid settlement agreement took place afterwards.

While the motive for filing the case appears somewhat suspect, this case still merits attention. The video game industry thrives on the press cycle established via trade shows and preview coverage granted to various media outlets. If industry giants are strictly liable for advertising claims made at these events, it could stifle speech and increase the burden on companies’ marketing budgets. It would not be good precedent for filing class action suits against any developer or publisher who releases a game that is not what consumers were expressly led to believe they were going to receive upon buying (sound familiar, No Man’s Sky?), which could lead to massive changes in the marketing of games. Developers would have to be more careful in regards to what information they release, and smaller developers may opt to not release as much press footage for fear of litigation. This could have a detrimental effect in that smaller games might not receive as much (or any) attention, thus adversely affecting potential profits.