Video Game Settlement Proposal Revived

Video Game Settlement Proposal Revived Photo: Gearbox Software aliens: Colonial Marines

Part of a proposed class-action deal—thrown off track when the lead plaintiff went to jail—is on again, with video-game developer Sega of America Inc. agreeing to a $1.25 million settlement. But Gearbox Software LLC continues to fight allegations that it unlawfully misrepresented the features of “Aliens: Colonial Marines.”

Read proposed settlement here.

Under the terms of the deal, filed Aug. 11 in U.S. District Court for the Northern District of California, as many as 135,000 disgruntled purchasers of the heavily promoted game could be eligible to share about $735,000 of Sega’s settlement pot. Plaintiffs’ attorneys would be allocated up to $312,000 and another $200,000 would be available to cover the costs of executing the settlement, according to Sega’s motion, in Perrine v. Sega.

Originally a co-defendant, game developer Gearbox Software LLC is snubbing a settlement, choosing instead to continue to battle the plaintiffs’ allegations that the company engaged in fraud in the inducement, negligent misrepresentation, breach of express warranties and violations of California consumer and business laws.

Lead plaintiff Damion Perrine originally sued both companies in 2013, alleging they hyped the game’s supposed exciting features in an advance gameplay demo. The complaint alleges the video game producers used the demo, which they knew would be more technically advanced than the actual finished game, to entice players to order the game before it was released or on its launch day, knowing that it is almost impossible for consumers to return newly purchased games for a refund.

When the actual game was released, it allegedly bore little re-semblance to the demo, and was bombarded by bad reviews and cries of “ripoff.”

According to court documents, the case was on the brink of settlement by both defendants on June 19, but then Perrine disappeared, only to be found later in a Pennsylvania county jail. A month later, the plaintiffs moved to withdraw Perrine as a class representative, and, shortly thereafter, Gearbox filed a motion for partial summary judgment and to strike the plaintiffs’ class allegations.

On July 30, the plaintiffs moved to withdraw Perrine as a class representative, and said the case would proceed with California resident John Locke as named plaintiff. But, by then, the settlement deal apparently had fallen apart.

That day, Gearbox filed a motion for partial summary judgment and to strike the plaintiffs’ class allegations.

Plaintiffs are represented by Benjamin Thomassen, Sean Reis, Mark Eisen, Rafey Balabanian and Christopher Dore, of Edelson. Gearbox is represented by attorneys at Fenwick & West and O’Melveny & Myers. Sega’s attorneys are with Fenwick & West and Quinn Emanuel Urquhart & Sullivan.

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