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Loot Box Lawsuit THREATENS EA Games With $5M Penalty

Crate

Here at ProfessionaRakeback, we're concerned mostly about online poker sites and everything related to them, but once in a while, we broaden our horizons to include other types of gaming too. Recent news regarding video game loot boxes has come to our attention, and we could not let it pass by without commenting on it.

More than 100 Californians are suing the Electronic Arts Games (EA Games) company for what has been described as “predatory” loot box gambling. The suit was filed on Aug. 13, 2020. According to the team of people proceeding with the lawsuit, loot boxes violate the state’s gambling laws, and the plaintiffs are seeking $5 million in damages.

Loot Box Lawsuit

Background

File Folder

“Loot boxes” came to be when traditional computer game developers started inserting randomized features into their releases. A loot box is an in-game goodie that, when opened, yields randomized items potentially useful for player progression.

EA Games has released numerous games that incorporate loot boxes, including the FIFA and Madden titles as well as Star Wars: Battlefront II. While some of the loot boxes can be found during the course of normal play and opened for free, the majority of them are provided as rewards after completing certain tasks. What’s more, these boxes must be opened with a key, which is where the payment side of things comes into play.

Upon purchasing a key, the loot box is opened, and you receive whatever is inside. The issue is that you don’t know what you’re getting until the box is opened. Therefore, some people believe that this is a form of gambling.

Different boxes will reward you with different items with some being a lot more valuable than those found in other boxes. Buying these boxes is not a prerequisite for completing the game, but it does let one advance more rapidly by unearthing powerful players, weapons, or equipment. Therefore, you stand a chance of having a better gaming experience by choosing to pay for loot boxes.

It didn’t take long for governments to latch on to the fact that receiving and opening these loot boxes was akin to gambling, and this led to some countries banning them outright. Despite the fact that the loot boxes are completely optional, many gamers take the opportunity to open them, paying a fee for the privilege, as they contain various skins and items to enhance the gaming experience.

Is It Unregulated Gambling?

Red Question Mark

The recent lawsuit has been brought forward and filed by two attorneys – Tim Blood and Andrew J. Brown who are operating on behalf of one Kevin Ramirez and more than 100 other people who have opted to remain anonymous. That lawsuit, Ramirez vs. Electronic Arts (5:20-cv-05672), alleges that EA's Ultimate Team loot boxes in its FIFA and Madden titles are in violation of gambling regulations.

Through the lawsuit, the group is hopeful that new precedents will be set for EA when a jury trial occurs. The primary aim of it is to force EA to alter what are described as “predatory and unlawful practices,” which concern loot boxes. Instead, it wants them to be regulated as gambling.

Furthermore, the plaintiffs want to require EA to pay for attorney fees as well as allow the plaintiffs to collect damages. The damages that Ramirez and the other members of the class are seeking equate to $5 million.

Legal Reasoning

The plaintiffs contend that EA “relies on creating addictive behaviors in consumers to generate huge revenues.” Ramirez himself asserts that when playing games featuring Ultimate Team loot boxes, he was compelled to spend more than $600 on both FIFA and Madden with these purchases dating back to 2011.

The lawsuit that has been filed emphasizes the psychological aspects surrounding these video games, and it heavily suggests that they are built in order to incentivize in-game spending. It also lists the amount of money that EA Games makes from its live services and cites research papers to highlight how those loot boxes are very psychologically addictive. Reports suggest that EA recorded quarterly live service earnings of $1.1 billion for the first quarter of 2020. That figure is up 60% on a year-on-year basis. This type of revenue stream also made up close to 80% of the total Q1 earnings.

The lawsuit against EA Games suggests that the Ultimate Team packs exist as “wagers on completely randomized chances within the game to win valuable professional players and other items for the EA gamer’s virtual sports team.” These packs, it states, “are nothing more than a gambling bet.”

It’s not just the fact that the boxes are considered to be gambling by Ramirez and co. but that the supposedly random outcomes ensure that there’s a very small chance of unlocking anything noteworthy. According to the case documents, EA Games is well aware that most loot boxes are simply filled with relatively worthless items and many duplicates. FIFA Ultimate Team packs provide players with only a 5.4% chance of unlocking a Gold 87+ reward and just a 1.1% chance of an Ultimate SCREAM player.

Previous Loot Box Disputes

EA Games has been front and center in past years with regard to loot boxes. It denied that these are a form of gambling in 2019 instead stating that they are “quite ethical and fun.” However, there was a counterargument from games journalist Ryan Brown who said that those players who had bought the loot boxes weren’t happy with the experiences they had. Certain negative feedback from customers playing Star Wars: Battlefront II led to EA removing some items from loot boxes in early 2018. Prior to this, Belgium had proceeded with making loot boxes illegal throughout the country.

Apple also suffered at the hands of a lawsuit in June with plaintiffs suggesting that the brand was utilizing “predatory practices” via App Store loot boxes. That case was also filed with the US District Court of Northern California although there is currently no legal or academic consensus in the United States on whether loot boxes constitute gambling or not.

Our Stance on the Matter

Pen + Paper

It seems as though attempting to crack down on loot boxes in video games is one of those unnecessary routes that government and the courts often take. After all, people should be able to choose what they spend their own money on, and if they decide to blow it on loot boxes, why not? As long as minors aren’t accessing them without their parents' or guardians' authorization, this should be of no consequence.

In actuality, this seems like another one of those circumstances where a few negative people are trying to impinge on the rights of others. In many cases throughout the years, way too much focus has been placed on silly situations and not enough on things that actually matter.

Similar situations have occurred in Australia with the government proceeding through with blocking gambling on a whole other level. Despite the fact that the country has a big love for gambling, the Aussie authorities have taken action to block real money online gaming rather than properly regulate it.

All of this worry about loot boxes does seem to suggest the possibility of governmental overreach. Granted, the Ramirez case doesn’t seem to involve much about protecting minors or vulnerable players – which is what most politicians claim with regard to restricting certain gaming freedoms.

Loot Boxes Nothing Really New

As it happens, this sort of “gambling” has been quite popular and mostly ignored by watchdogs for decades. After all, people spend their time buying Pokémon cards in the hopes of gathering enough different ones to create a complete collection. You never know what is inside a pack of Pokémon cards before you purchase it, so what is the difference between this and video game loot boxes?

There are also similarities with traditional sports card collecting. Will there be laws brought in to regulate and potentially ban, in due course, such pastimes as buying baseball cards?

Baseball CardsDangerous Gambling Implements?

Would there really be so many games with loot boxes built into them if players weren’t so eager to receive and open them? Are the negative experiences of some players really enough of a reason to impact the potentially good experiences of others? Obviously, the fact that countless individuals are buying the boxes demonstrates that they hold massive appeal to the public at large.

Poker Awaits

Casino Chips and Playing Cards

If you like the thrill of wagering your cash on uncertain outcomes, then perhaps you would find poker superior to loot boxes. Unlike with these video game gimmicks, you actually exert some control over your success in poker, and you can profit by winning real money too rather than just virtual goods.

For a complete rundown of trustworthy places to play cards online from California, brows over to our factual California online poker page. Or if you live in another state, check out our thorough USA offshore poker guide.