Last year, PC game developer Wolfire Games filed a class-action lawsuit against Valve, alleging that the way the company operates its Steam platform allows it to unfairly dominate the PC gaming market. Back then, U.S. District Court Judge John C. Coughenour issued preliminary rulings in favor of Valve twice but has now allowed an amended version of the lawsuit to move forward.
As recently noted by Bloomberg Law, the latest decision from Judge Coughenour has given his blessing for essentially a portion of the antitrust lawsuit to move forward. Basically, Wolfire’s claims about Steam’s policy driving up the prices of games – via 30% sales commissions – and the allegation that Valve exploits the market by retaliating against game developers who sell their games for cheaper outside of its distribution platforms will now face contention in court. Meanwhile, a claim that Valve should split its “gaming platform” and “store” will not be allowed. The judge claims that there is no merit or consumer demand for this split.
In his latest ruling, Judge Coughenour pointed out that Valve allegedly uses a combination of “written and unwritten rules” to assert its dominance in the PC gaming market. He emphasized that the lawsuit also claims that Valve controls how non-Steam games are priced, and as such, “these allegations are sufficient to plausibly allege unlawful conduct”.
The judge also backtracked on his earlier ruling that stated that there is no evidence that Valve’s practices have raised game prices over the years. He had emphasized that even when Steam was competing against physical stores, it “did not need market power to charge a fee well above its cost structure because those brick-and-mortar competitors had a far higher cost structure”.
It remains to be seen how the lawsuit will progress given the initial challenges for the plaintiff, but we’ll keep you updated.