Game company representation, winning case regarding paid content refunds due to suspension of game provision.

Law firm Veat successfully won a lawsuit regarding refund claims for paid content, commissioned by a metaverse platform game company (hereinafter referred to as “the client”).

​This case began when game provision was suspended following the Game Management Committee’s decision to revoke the game’s rating. Some game users requested refunds for the paid content they purchased during gameplay and filed this lawsuit.

Law firm Veat argued that the provision of “the Act on Consumer Protection in Electronic Commerce” (hereinafter referred to as “the Electronic Commerce Act”) Article 17(3), which states that ‘the content of goods or services does not match the displayed or advertised content or is not performed as agreed in the contract,’ does not apply, arguing that the free game usage contract and the paid content purchase contract should be distinguished. The court accepted this argument and rejected all claims by the game users involved in this case.

Refunds and Terms Game Companies Should Review

 

In February of this year, the Fair Trade Commission revised the standard terms and conditions to specify the obligation to disclose information on items with a chance of winning and to operate a dedicated refund channel for paid items for at least 30 days after the game service ends (Online Game Standard Terms and Conditions Article 15(9), Mobile Game Standard Terms and Conditions Article 25(4)).

The Fair Trade Commission particularly judged the following contractual clauses to be unfair:

Restrictions on cancellation of contracts for items with limited periods and receipts, used cash, and items belonging to temporarily suspended accounts were deemed disadvantageous to consumers except for reasons stipulated in the Electronic Commerce Act. Furthermore, provisions that only recognize refunds for the entire remaining cash or only recognize refunds when problems occur due to the company’s sole negligence, and provisions that do not recognize transaction cancellations depending on the payment method, were deemed to excessively restrict refunds and could be deemed invalid (Press Release-6769 of the Fair Trade Commission on June 26, 2019).

Standard terms and conditions are not mandatory to comply with, but serve as a basis for resolving disputes in the online game market, so they should be prepared accordingly. Contractual clauses that do not comply with the Contract Act can be invalidated. Therefore, we recommend that you receive accurate legal advice from a legal professional who comprehensively understands “game services” and “law.”

Law firm Veat proactively identifies and understands legal changes that may affect game services, such as Fair Trade Commission guidelines, and provides optimal legal advice to game companies so they can comply with new regulations while achieving their business goals.

Law firm Veat provides excellent advice in areas such as various game lawsuits, the Electronic Commerce Act, and paid content refunds, which are challenges faced by game companies and metaverse and IT companies, and will do its best to help clients operate their businesses successfully.

Thank you.

Sincerely, Law firm Veat