Legal Opinion: Does the class-action lawsuit over Aliens: Colonial Marines have a chance?

Aliens: Colonial Marines

By on May 10, 2013 at 12:07 pm

If BioWare had shown Kelly in the trailers for the Mass Effect 3 Citadel DLC, I’d be pissed — because they completely left her out of the final product. I’m still pissed, but I’d be even more pissed if they had my hopes up.

A (somewhat) similar issue occurred with Aliens: Colonial Marines. The game was possibly the worst game ever made (in 2013). Our own review called it “an embarrassment that should never have been released”.

This was particularly cutting because the work in progress demonstration trailer had previously showed a far better game. Some gamers were so riled up that they launched a class action lawsuit against Sega and Gearbox for false advertising.

Opinion around the interwebs has been divided. While most players support the lawsuit, some just aren’t sure whether it has a chance of succeeding. Today, we’ll be looking at whether the Aliens: Colonial Marines pre-release demonstration trailer was false advertising enough to give grounds for a lawsuit.

Is it advertising?

First up, we need to get away from the idea that there is actually a distinction between a game demonstration and an advertisement. In Australia, false advertising standards are broad, and apply to everything a business does. The ACCC writes:

“The ‘do not mislead’ principle applies to all commercial dealings. It is not only advertising that can potentially mislead. The principle covers any kind of commercial dealing—for example, selling presentations, product descriptions, packaging, contract terms, negotiating, representations—where a message is sent that creates or is likely to create the wrong idea or wrong impression on the part of the recipient.”

Under Australian law, a demonstration at a convention could indeed be capable of being illegally misleading. But whether such a finding actually leads to a penalty, or simply a slap on the wrist, is really a question of what damage was actually caused to the buyers. Under American law, this question is even more relevant: the demonstration needs to have misled the buyer to the extent they made a mistaken purchase.

Therefore, our next step is to consider what part the demonstration played in convincing people to buy the game.

The hype problem

False advertising is usually cut and dry. You write on the packaging of a breakfast snack that it contains essential vitamins and minerals, when in actuality it contains radioactive ooze. Or (more commonly) the snack contains so little vitamins that they give no dietary value. In both cases, the customer was enticed to make a purchase by a benefit that didn’t exist.

Games introduce a thorny issue because so much of what convinces people to buy is not traditional advertising. It’s hype. Games are heralded by a deluge of previews, gameplay demonstration trailers, teasers, viral marketing, developer interviews, and convention showings.

All these are important for at least creating awareness in the gaming press. This exposure builds up until people are convinced that the game is worth buying. Without the pre-release demonstration trailer, Aliens: Colonial Marines would have had much less exposure, and therefore, less sales.

This was recognised, at least, when in response to the Colonial Marines controversy, Sega was ordered to put “work in progress” notices more prominently on its demonstration materials. Therefore, there is clearly “a” problem. But whether this means gamers are entitled to damages also depends on whether the demonstration actually misled them to lose money.

The pre-order problem

The key moment for deciding this case is the point at which gamers handed over money, and what led them to do so. Aside from Kickstarter (which has its own problems with this), gaming is perhaps the only industry that lets you buy something before it even exists.

In the comments on one of our news articles, an example was given of a concept car demonstration. However, no one hands over money based on seeing a concept car at a show. Advertisements are there to entice a person to enter the showroom and take a test drive. False advertising cannot occur at the concept car stage, because this is not accepted to be reliable.

In contrast, many people do buy games based on pre-order hype. This was certainly the case with Colonial Marines. The problem was exacerbated by Gearbox not keeping its pre-release gameplay footage current after they knew they had a serious problem.

Although this has not really been tested in a court, these issues make the gaming hype roughly equivalent to more traditional advertising. Arguably, the gamers that were enticed to pre-order based on this footage (even if they should have waited for reviews) are entitled to some compensation.

The vertical slice problem

Gearbox’s comment on the lawsuit is quite… angry.

“Attempting to wring a class action lawsuit out of a demonstration is beyond meritless,” was their response. “We continue to support the game, and will defend the rights of entertainers to share their works-in-progress without fear of frivolous litigation.”

Ouch. The problem with this attitude is that the trailer does not appear to be a true work in progress. Given the sheer quality difference between the trailer and the final game, it’s clear that the trailer was a “vertical slice”: a marketing creation filled with custom textures, animation, sounds, and sequences that were never intended to go into the final game at all.

These slices divert resources from the actual game, because their sole purpose is to invent something pretty that can be used to drive hype. Possibly, if the developers had spent the time on the actual game instead of their marketing creation, the game wouldn’t have been such a disaster.

That is really a separate legal issue and one more suited to an epic battle between Gearbox and Sega. However, it does come back to the point of false advertising laws. False advertising is prohibited because marketing is not meant to cover the flaws of a product so brazenly: consumers are entitled to make purchases based on true merits. When a vertical slice has such a huge difference with the final game, this is exactly the kind of thing that false advertising laws are trying to stop.

As such, on principle the lawsuit is worth bringing — at least as a test case. There are interesting issues about whether hype can be advertising, and whether these laws can extend this far.

But even these aside, the point worth proving is that developers should not spend half their budget on marketing hype in an attempt to secure pre-orders.

22 comments (Leave your own)

So does the lawsuit have a chance or not?

 
Toby McCasker

Really fascinating. Great one (as usual), Patricia.

 
Patrick Vuleta

Thanks. :)

@Mythor: Well my conclusion on that is that it has its merits, hence is not completely frivolous as Gearbox claim.

 

I guess a further question is, if this does count as advertising and as such was misleading, should damages amount beyond what the people within the law suit spent on the game?

 
Patrick Vuleta

No they won’t. It’s highly unlikely people will get more than a few dollars out of the lawsuit.

 

The only people that truely win in class actions are the laywers :/

 

Thanks for writing the article, it provides a balanced perspective on the issue. Personally I never pre-ordered A:CM based on the trailers, it was more on the good company reputation Gearbox had established themselves with Borderlands 1 & 2…a reputation that has been damaged for me. If this lawsuit succeeds, it would be interesting to see how it affects developers’ willingness to release promotional material.

 

ralphwiggum:
Thanks for writing the article, it provides a balanced perspective on the issue. Personally I never pre-ordered A:CM based on the trailers, it was more on the good company reputation Gearbox had established themselves with Borderlands 1 & 2…a reputation that has been damaged for me. If this lawsuit succeeds, it would be interesting to see how it affects developers’ willingness to release promotional material.

How does stealing from a talent group of up-starts (CODEHUNTERS), a gaming giant (Fallout 3) and freelance artist (Olly Moss) equate to ‘good company reputation’?

*shakes head*…

 

Personally I never pre-ordered A:CM based on the trailers, it was more on the good company reputation Gearbox had established themselves with Borderlands 1 & 2<

You did hear about what they served up with Duke Nukem Forever, didn’t you? Pitchford has no shame whatsoever with regards to enthusiastically hyping turds.

 

teufelhund: You did hear about what they served up with Duke Nukem Forever, didn’t you? Pitchford has no shame whatsoever with regards to enthusiastically hyping turds.

DNF I was willing to give the benefit of the doubt given the turd of a mess they inherited from 3D Realms.

PinothyJ: How does stealing from a talent group of up-starts (CODEHUNTERS), a gaming giant (Fallout 3) and freelance artist (Olly Moss) equate to ‘good company reputation’?

*shakes head*…

I meant given they released really good games called Borderlands 1 & 2 which I’ve really enjoyed and played hundreds of hours, I was hoping that same good quality would carry over to A:CM. All that other stuff which you’ve mentioned (before) wasn’t a consideration for me. Sorry.

 

makena:
I guess a further question is, if this does count as advertising

If you read the article, you’ll note that whether it’s “advertising” is not relevant – it’s simply ‘conduct’ which matters.

 

I hope they lose because the last thing I want is developers using this as a reason to not get into showing early builds and stuff like that :s I want more openness from devs not less and if a publisher sees I imagine it would have an impact on how much devs could share.

 

caitsith01,

I did read it, and your distinction makes no difference what so ever to my question.

 

It seems that in Australia the case has significant merit. By what Patrick has posted in regards to the relevant ACCC rules, it seems that the case indeed has a good chance of succeeding if it were to be tried in Aus.

However if anyone that jumps on board this bandwagon thinks that they’ll get awarded damages is beyond… well… retarded. The above poster was right, the only people who will win are the lawyers. The gamers might get a dollar or two out of it, but I guess what we can hope for is that in the future devs will not be so blatant about their ‘works in progress.’

Then again I think that has already been accomplished even without a lawsuit.

 

Gearbox + that demo footage = me preordering.

In the least I hope they get made to fix the AI….. It’s horrible.

 

dassquid: The above poster was right, the only people who will win are the lawyers

If this forces games companies to stop using deceptive and fraudulent business tactics, every gamer has won, regardless of how trivial the monetary payback is.

This case is very critical, in that it will very likely influence future conduct of companies. If gearbox gets away with this, the industry is going to take it as a sign that outright fraud is now acceptable, and DNF and colonial marines level turds will become much more common.

@ Patrick Vuleta, Under law, either Aust or US, can these types of cases result in punitive damages being implemented?

It really seems like the damages will need to be of the magnitude to be punitive to really have an effect on games companies. Its unfortunate that if its just a slap on the wrist, most games companies will just treat it as another cost of doing business and continue with the shenanigans.

 

bottom line. They marketed a game. and sold it as a AAA title. 70$ on the shelf or what ever it cost. and the game was a piece of shit. badly made. blatently badly made. not even student designers would hand this in to there teachers. and they played it off like it was finished. to make back there development costs. by ripping the players off.

 
Patrick Vuleta

coatsy22:

@Patrick Vuleta,Under law,either Aust or US, can these types of cases result in punitive damages being implemented?

It really seems like the damages will need to be of the magnitude to be punitive to really have an effect on games companies. Its unfortunate that if its just a slap on the wrist, most games companies will just treat it as another cost of doing business and continue with the shenanigans.

They can, but as you say is likely to not be much if any.

 

yeah but its NOT hype

 

Is this action based on gearbox having refused to refund disgruntled customers? One thing the article doesn’t seem to cover, and something i would think is fairly important, is that the case loses alot of credibility if the customers launching the action never actually tried to get a refund. Open violation of consumer law is a problem. A suit for damages without even exploring the standard consumer options? Frivolous indeed.

 
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