Valve May End Up Paying a $3 Million Fine for Failing to Offer Refunds in Australia

Valve May End Up Paying a $3 Million Fine for Failing to Offer Refunds in Australia

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Valve's failure to offer Steam refunds to Australian customers in past years may wind up costing it millions.

Valve has taken a lot of flak over the years for its failure to offer refunds on Steam. That flak is likely what led the company to start offering Steam refunds in June of 2015. But before Valve started its refund program, a case was brought against it in Australia.

In 2014, the Australian Competition and Consumer Commission filed suit against Valve over its refund policy. The suit says,

"Under the Australian Consumer Law, all consumer goods or services come with automatic consumer guarantees that they are of acceptable quality and fit for the purpose for which they were sold. If they are not, consumers have a right to a remedy, which may include refund, repair or replacement in certain circumstances. These consumer rights cannot be excluded, restricted or modified."

Thanks to the lack of a refund policy prior to 2015, including stating in its Subscriber Agreement that it had a "standalone policy not to give refunds," the company was found to have violated Australian Consumer Law earlier this year. Valve initially argued that because it was based in Seattle, it shouldn't be subject to the same standards that Australian companies were held to. The court didn't find that argument compelling, as Valve was providing a service to Australian customers.

During a hearing last week, Kotaku AU reports that the ACCC put forth its suggestion for Valve's punishment: a fine of $3 million AUD. Furthermore, the ACCC requested an injunction against Valve to make sure that its current refund policy is in compliance with Australian law.

Valve's attorneys proposed a fine of $250,000 instead, arguing that there had been "no finding that Valve's conduct was intended to mislead or deceive consumers." This suggestion prompted Justice Edleman to ask, "Your proposed penalty of $250,000 isn't even the price of doing business, it's next to nothing is it?"

In response to a query from the presiding justice as to whether Valve would resist paying any judgment as a foreign company, the company's attorney said that there were "no instructions that Valve at this time will resist the enforcement overseas of any of your Honour's orders."

While the requested fine of $3 million is unlikely to be levied, it also seems likely that the fine will wind up being higher than Valve's proposed $250,000. Justice Edleman said that he aimed to hand down his final ruling, covering both penalties and a decision on the injunction, by mid-December or January.

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While we are on the subject of Valve getting sued, how was that German class-action case going?

I feel shit like this is really going to put to the test of how much money Steam makes for Valve. Because if it isn't enough, I feel simply being slow to the trigger is going to be the death of Valve and Steam with all the lawsuits.

Wonder if this will get them to go after those CSGO gambling sites faster...

MatthewTheDark:
I feel shit like this is really going to put to the test of how much money Steam makes for Valve. Because if it isn't enough, I feel simply being slow to the trigger is going to be the death of Valve and Steam with all the lawsuits.

All they need to do is make Half Life 3 and they'll recoup.

RaikuFA:

MatthewTheDark:
I feel shit like this is really going to put to the test of how much money Steam makes for Valve. Because if it isn't enough, I feel simply being slow to the trigger is going to be the death of Valve and Steam with all the lawsuits.

All they need to do is make Half Life 3 and they'll recoup.

But that would require effort put into making games rather than skins and hats.

MatthewTheDark:
I feel shit like this is really going to put to the test of how much money Steam makes for Valve. Because if it isn't enough, I feel simply being slow to the trigger is going to be the death of Valve and Steam with all the lawsuits.

My off-hand guess is that the full 3 million plus lawyer fees would be covered by their Australian profits with room to spare. ...Valve makes a lot.

MatthewTheDark:
Because if it isn't enough, I feel simply being slow to the trigger is going to be the death of Valve and Steam with all the lawsuits.

Steam makes Valve billions of dollars every year, even if every country in the world fined them three million dollars they could pay it out of cash in hand and carry on with their business as if nothing happened.

Valve really have made a complete about turn from their image as a consumer rights focused company. They literally based their defense on the idea that the law shouldn't apply to them in countries they do business in, even Activision isn't that brazenly dickish these days.

Given that they now have a refund policy in place, I think it would be a little dickish for the ACCC to go after Valve too hard.

Having said that, as others have pointed out, Valve can afford whatever punishment is meted out, so from a PR perspective, they probably shouldn't fight it too ferociously.

MatthewTheDark:

RaikuFA:

MatthewTheDark:
I feel shit like this is really going to put to the test of how much money Steam makes for Valve. Because if it isn't enough, I feel simply being slow to the trigger is going to be the death of Valve and Steam with all the lawsuits.

All they need to do is make Half Life 3 and they'll recoup.

But that would require effort put into making games rather than skins and hats.

Ah... why would you bother making skins and hats when you can let other people do it and making profit off their IP?

Their whole refund policy still needs a ton of work - I still have not gotten a refund for The Stomping Grounds, for instance, even though the developer ran off with the money, and even left his own team in the dark, to the point where they had to recoup their losses by selling in-studio assets.

Ah well. I guess, at least, I learned a lesson in being more careful about EA games. But it still does not detract Steam from their client responsibilities in dealing with con developers.

distortedreality:
Given that they now have a refund policy in place, I think it would be a little dickish for the ACCC to go after Valve too hard.

Having said that, as others have pointed out, Valve can afford whatever punishment is meted out, so from a PR perspective, they probably shouldn't fight it too ferociously.

2 hours and/or 2 weeks might seem fair, but we Australians have actual consumer rights. And their current refund system is an insult.

WoW.. Amount of research thatwent into this Article: 0.

ffronw:

Valve has taken a lot of flak over the years for its failure to offer refunds on Steam. That flak is likely what led the company to start offering Steam refunds in June of 2015. But before Valve started its refund program, a case was brought against it in Australia.

Incorrect. Valve actually had a refund policy. The only change in 2015 was that is be came a mostly automated policy. Secondly the case is less about refunds and more that valve misrepresented the issue of refunds to Aussies. Essentially Valve lead some customers to believe they had no right to a refund and no ability to refund when they actually did.

Thanks to the lack of a refund policy prior to 2015, including stating in its Subscriber Agreement that it had a "standalone policy not to give refunds," the company was found to have violated Australian Consumer Law earlier this year. Valve initially argued that because it was based in Seattle, it shouldn't be subject to the same standards that Australian companies were held to. The court didn't find that argument compelling, as Valve was providing a service to Australian customers.

Basically says it right there. the SSA was typoed.

Furthermore, the ACCC requested an injunction against Valve to make sure that its current refund policy is in compliance with Australian law.

While the requested fine of $3 million is unlikely to be levied, it also seems likely that the fine will wind up being higher than Valve's proposed $250,000. Justice Edleman said that he aimed to hand down his final ruling, covering both penalties and a decision on the injunction, by mid-December or January.

Just in time for the Lunar and chriustmas sales. Sucks to be you Australia :P.

Now if they could go after Microsoft for the same shit on the Xbox store. Couldn't get a refund for the Master Chief Collection despite not being able to play it even after it was "fixed." (It's fine now, but still.)

3 million? How will valve ever survive such a harsh slap on the wrist.... wich was done with a plushy... by a 6 year old...

RaikuFA:

MatthewTheDark:
I feel shit like this is really going to put to the test of how much money Steam makes for Valve. Because if it isn't enough, I feel simply being slow to the trigger is going to be the death of Valve and Steam with all the lawsuits.

All they need to do is make Half Life 3 and they'll recoup.

The ROI on making games is too small for Valve's current business model. Creating new economies, now that is what gets Valve's attention.

008Zulu:

distortedreality:
Given that they now have a refund policy in place, I think it would be a little dickish for the ACCC to go after Valve too hard.

Having said that, as others have pointed out, Valve can afford whatever punishment is meted out, so from a PR perspective, they probably shouldn't fight it too ferociously.

2 hours and/or 2 weeks might seem fair, but we Australians have actual consumer rights. And their current refund system is an insult.

I don't know dude, I don't have a problem with it personally, but then again I've never had to refund a game, so....

I will say though that I think entertainment media should have a vastly different set of rules and standards regarding refunds.

Good. Valve only got into this situation because they wanted to peddle endless amounts of shovelware and broken trash without any sort of oversight or recompense for customers buying games that flat-out don't work or lie in the store page.

And, as Fix-The-Spade put it:

fix-the-spade:
They literally based their defense on the idea that the law shouldn't apply to them in countries they do business in, even Activision isn't that brazenly dickish these days.

Seriously, who does that? Who literally gets a lawyer to say "we're not obligated to care about your bare minimum consumer rights laws"?

MonsterCrit:

Incorrect. Valve actually had a refund policy. The only change in 2015 was that is be came a mostly automated policy. Secondly the case is less about refunds and more that valve misrepresented the issue of refunds to Aussies. Essentially Valve lead some customers to believe they had no right to a refund and no ability to refund when they actually did.

Pretty sure I remember reading an ACCC article about customers actively being snubbed by Support enough though the games they were trying to return were flat-out broken. The issue is more serious than a misleading FAQ on the Support page.

And even then, it's still considered a serious offense to actively lie about a consumer's rights, whether it's to their face or in a general FAQ.

distortedreality:
Given that they now have a refund policy in place, I think it would be a little dickish for the ACCC to go after Valve too hard.

Having said that, as others have pointed out, Valve can afford whatever punishment is meted out, so from a PR perspective, they probably shouldn't fight it too ferociously.

Their refund policy still violates Australian ACCC laws. You can personally feel it does the job to your hearts content. It still does not meet the standards set by our laws.

so far i have been given refund to 2 games this year so far without any hassle but i certainly agree that this should change and valve hopefully sees that they cant get away with what ever they want. or any company.

MonsterCrit:

Incorrect. Valve actually had a refund policy.

Since when? When I couldn't get Morrowind to work on any of the PCs in my house I tried contacting support for a refend and was told point-blank "under no circumstance do we offer refunds". Now that was 2009 so I don't know if a refund policy was quietly added a some point between then and the big 2015 refund system, but if it was I never heard so much as a whisper about it.

OT: Good, thats what they get for thinking they can just ignore consumer protections. Now can we dispense with this silly idea that Valve is some kind of wonderful all-loving uncompromisingly consumer friendly company?

Infernal Lawyer:

MonsterCrit:

Incorrect. Valve actually had a refund policy. The only change in 2015 was that is be came a mostly automated policy. Secondly the case is less about refunds and more that valve misrepresented the issue of refunds to Aussies. Essentially Valve lead some customers to believe they had no right to a refund and no ability to refund when they actually did.

Pretty sure I remember reading an ACCC article about customers actively being snubbed by Support enough though the games they were trying to return were flat-out broken. The issue is more serious than a misleading FAQ on the Support page.

And even then, it's still considered a serious offense to actively lie about a consumer's rights, whether it's to their face or in a general FAQ.

In the terms of those games, the courts agreed with Valve. Being told you do not qualify does not mean you are being snubbed. Just means you don't meet the criteria.

major_chaos:

MonsterCrit:

Incorrect. Valve actually had a refund policy.

Since when? When I couldn't get Morrowind to work on any of the PCs in my house I tried contacting support for a refend and was told point-blank "under no circumstance do we offer refunds". Now that was 2009 so I don't know if a refund policy was quietly added a some point between then and the big 2015 refund system, but if it was I never heard so much as a whisper about it.

Oh they always had. The criteria were just secret andone of them wasn't. I bought a game my hardware can't run.

Example:

* Refunding within 24 hours of purchase.
* Misrepresentation of game on Store Page
* Inaccurate system specs on Store Page
* Replicable game breaking error.

Keyword is replicable. What they would do is essentially try the game on their test systems and see if they encountered the same error. If they did, Refund, if they didn't, the problem was clearly specific tto your hardware and therefore, your problem.

All they basically did in 2015 was develop an easily automated criteria that would allow them to accomplish the same effect. Hence 2 hours of play time and 2 weeks from purchase. 2 Hours is enough time to figure if there are errors. and 2 weeks is enough time to notice a purchasing error.

The move has more or less reduced Valve's operating expenses.

Karadalis:
3 million? How will valve ever survive such a harsh slap on the wrist.... wich was done with a plushy... by a 6 year old...

That's what I was thinking. Isn't $3 million Australian like $5000 US? (ba dum tish)

MonsterCrit:
Just in time for the Lunar and chriustmas sales. Sucks to be you Australia :P.

Are you implying that due to the ACCC suing Valve that somehow it means we won't get access to any sales as a result? Cause I'd love to know how that works.

Karadalis:
3 million? How will valve ever survive such a harsh slap on the wrist.... wich was done with a plushy... by a 6 year old...

You can joke about it if you like but just as Hello Games is being investigated by an international organisation (ASA), Valve too should take it seriously. If you want to sell products in another country then you have to abide by their laws. Failing to do so can net you a hefty fine as seen here and if they don't pay up then they could lose out on a country of over 23 million. Of course I doubt it'll come to that, they'll probably make some kind of deal.

JUMBO PALACE:
That's what I was thinking. Isn't $3 million Australian like $5000 US? (ba dum tish)

Man, sometimes it really feels like it but the dollar was at parity during the mining boom, now I'd say that 3 million AUD is closer to 2.2 million USD. Though most of these lawsuits are in USD anyway.

So, they're charging them chump change? I mean, 3 million? For Valve? That's like fining the average citizen a dollar and hoping it'll make him change his ways...

MonsterCrit:

Infernal Lawyer:

MonsterCrit:

Incorrect. Valve actually had a refund policy. The only change in 2015 was that is be came a mostly automated policy. Secondly the case is less about refunds and more that valve misrepresented the issue of refunds to Aussies. Essentially Valve lead some customers to believe they had no right to a refund and no ability to refund when they actually did.

Pretty sure I remember reading an ACCC article about customers actively being snubbed by Support enough though the games they were trying to return were flat-out broken. The issue is more serious than a misleading FAQ on the Support page.

And even then, it's still considered a serious offense to actively lie about a consumer's rights, whether it's to their face or in a general FAQ.

In the terms of those games, the courts agreed with Valve. Being told you do not qualify does not mean you are being snubbed. Just means you don't meet the criteria.

And where does it say that? The entire point of the lawsuit is that the ACCC feels they DID quality for refunds when they were being ignored.

Elijin:
Their refund policy still violates Australian ACCC laws. You can personally feel it does the job to your hearts content. It still does not meet the standards set by our laws.

Games are different though. Some of them are very short games which can be played within 2-3 hours. If you can just get a refund for it every time, there's nothing stopping someone from just getting their enjoyment out of it and then demanding a refund.

Infernal Lawyer:

MonsterCrit:

Infernal Lawyer:

Pretty sure I remember reading an ACCC article about customers actively being snubbed by Support enough though the games they were trying to return were flat-out broken. The issue is more serious than a misleading FAQ on the Support page.

And even then, it's still considered a serious offense to actively lie about a consumer's rights, whether it's to their face or in a general FAQ.

In the terms of those games, the courts agreed with Valve. Being told you do not qualify does not mean you are being snubbed. Just means you don't meet the criteria.

And where does it say that? The entire point of the lawsuit is that the ACCC feels they DID quality for refunds when they were being ignored.

You need to do a bit more reading. This whole thing is about whether or not Valve willfully misrepresented the right to a request a refund in their SSA. The games however were found to be justifiably rejected for refund. Theproblem is, in simpler terms, Not that valve told people they didn't qualify for a refund, but that they implied they couldn't even ask for one.

MercurySteam:

MonsterCrit:
Just in time for the Lunar and chriustmas sales. Sucks to be you Australia :P.

Are you implying that due to the ACCC suing Valve that somehow it means we won't get access to any sales as a result? Cause I'd love to know how that works.

Quite easily. You know how geolocation can pick out where you are based on your IP addy. yeah. that can also be useed to you know, block access to server... like the servers that host the Steam website and client pages. And I'm not just talking for sales. I'm talking period. That's sort of what an injunction means.

MonsterCrit:

MercurySteam:

MonsterCrit:
Just in time for the Lunar and chriustmas sales. Sucks to be you Australia :P.

Are you implying that due to the ACCC suing Valve that somehow it means we won't get access to any sales as a result? Cause I'd love to know how that works.

Quite easily. You know how geolocation can pick out where you are based on your IP addy. yeah. that can also be useed to you know, block access to server... like the servers that host the Steam website and client pages. And I'm not just talking for sales. I'm talking period. That's sort of what an injunction means.

A quick Google search says an injunction doesn't have to mean something that drastic. It could, but it could also just mean a warning or a deadline for them to get their act together.

Still, even if I'm wrong, it would be pretty damn ironic to see the company that embraced the Russian market despite all the illegal piracy ditching the Australian market (if not willingly) because of the legal consumer rights. That's just completely backwards.

Infernal Lawyer:

MonsterCrit:

MercurySteam:

Are you implying that due to the ACCC suing Valve that somehow it means we won't get access to any sales as a result? Cause I'd love to know how that works.

Quite easily. You know how geolocation can pick out where you are based on your IP addy. yeah. that can also be useed to you know, block access to server... like the servers that host the Steam website and client pages. And I'm not just talking for sales. I'm talking period. That's sort of what an injunction means.

A quick Google search says an injunction doesn't have to mean something that drastic. It could, but it could also just mean a warning or a deadline for them to get their act together.

Still, even if I'm wrong, it would be pretty damn ironic to see the company that embraced the Russian market despite all the illegal piracy ditching the Australian market (if not willingly) because of the legal consumer rights. That's just completely backwards.

Valve is a business and let's face it, this would not be the first time Australia was considered more trouble than it's worth. Besides Valve knows nothing they do would stop Aussies. it's just that by not officially operating in Australia, they kinda dodge any of those laws. An Aussie buying from steam, would be not unlike an australian traveling to venezuala to buy something. Australian laws wouldn't apply to the retailer and the boyer would likely be subject to extra taxes. See how that works. Aussies get to pay more and have no more protection than they did before the whole thing.

Bravo Aussie Land.

 

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