Valve, one of the world's biggest video games companies, just lost a major legal fight in Australia over a $3 million fine

ScreenshotA scene from Half-Life.

Valve Corporation, the US-based video game developer and distribution business with more than 2.2 million subscribers in Australia, has lost its High Court challenge over a $3 million fine for misleading or deceptive conduct.

Valve, one of the world’s largest online game retailers, runs the Steam platform, offering games such as Half-Life, Counter-Strike, Portal, Day of Defeat, Team Fortress, and Left 4 Dead.

In 2014, the Australian Consumer and Competition Commission (ACCC) launched legal action against Valve because it failed to offer refunds to Steam customers between 2011 and 2014, in breach of Australian Consumer Law.

The Federal Court found in the ACCC’s favour in March 2016, fining the company $3 million in December of that year.

The Court found Steam’s terms and conditions, and refund policies, included false or misleading representations about consumers’ rights to obtain a refund for games if they were not of acceptable quality.

Justice Edelman was scathing in his judgment, saying “Valve’s culture of compliance was, and is, very poor” and its evidence “disturbing”.

Valve “formed a view …that it was not subject to Australian law… and with the view that even if advice had been obtained that Valve was required to comply with the Australian law the advice might have been ignored” and also “contested liability on almost every imaginable point”.

In December last year, the Full Court of the Federal Court of Australia dismissed Valve Corporation’s appeal against a ruling.

Valve had sought special leave to appeal that decision in the High Court, which today dismissed that application.

The High Court decision means the original fine stands.

ACCC Commissioner Sarah Court said ruling also means anyone selling products selling locally must comply with Australian Consumer Law.

“This important precedent confirms the ACCC’s view that overseas-based companies selling to Australian consumers must abide by our laws,” she said.

“If customers buy a product online that is faulty, they are entitled to the same right to a repair, replacement or refund as if they’d walked in to a store.”

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