Evans et al vs Linden Lab: The new lawsuit on the block

Just to strain our collective brain here at Massively, there's a new lawsuit that has been leveled against Second Life operator, Linden Lab. Plaintiffs Carl Evans, Donald Spencer, Valerie Spencer and Cindy Carter have applied for a class action lawsuit against Linden Lab on property ownership, misrepresentation and fraud.

The plaintiffs are represented by Jason Archinaco, of Pribanic, Pribanic, and Archinaco LLC of Pittsburgh. You may remember Archinaco's name as the man who represented Marc Bragg in Bragg vs Linden Lab on similar issues. That particular case was settled, and the terms of the settlement remain unknown – but appeared to be favorable to Bragg.

Another name you might remember is our second-favorite USA Federal Judge, Eduardo Robreno, who heard the Bragg vs Linden Lab case, and is now hearing Evans et al vs Linden Lab. It's almost like old home week! Glee!

Robreno found issues with the Second Life Terms of Service, and with the Terms of Service likely to go on trial in this case, it could have far-reaching effects for similar boilerplate EULAs for other virtual environments and MMOGs, as well as for Linden Lab's own new Terms of Service.

From the outset, Archinaco's signature style shows through in the complaint document. The extensive research (backed by his having travelled this route before), coupled with his extensive attention to detail is strongly evident throughout.

The complaint quotes Linden Lab founder/chairman Philip Rosedale, and official Linden Lab communications dozens of times, where they stress ownership, the status of virtual items as property and Linden Dollars as a currency. (Even the new Second Life Terms of Service still make occasional conflicting references to users owning virtual property, though those same terms deny that ownership in other places.)

Overall the complaint lays out how Linden Lab systematically represented that virtual items and virtual land were owned by users, and not by the Lab, and how the Linden Dollar constituted a currency, no less nor more valid than any other. The complaint then goes on to detail how the Lab quietly began withdrawing all such representations, instead substituting 'limited licenses' as a descriptive term, and progressively presenting that Linden Lab was the owner of all of these things – essentially altering users' title "without consideration, the consumer's knowledge or consent."

What's in a name?

If it looks like a duck and quacks like a duck and in all other practical ways behaves like a duck, then it doesn't matter if you call it a limited license to interact with a duck; it's still a darn duck.

Changing the name of something may influence our perceptions of it, but doesn't fundamentally alter the fact of the thing; and Linden Lab has a long history of reinforcing the idea of currency and of ownership and title (which continues somewhat erratically to this day).

The complaint quotes Rosedale as stating that taking someone else's property in Second Life would be a crime, as the user is the owner. The plaintiffs here have all had their Second Life property (and US dollars in their accounts) taken from them by Linden Lab without due process.

If this sounds a lot like the Bragg vs Linden Lab case, then that's because the cases are substantively similar, and contain much the same supporting material, only in this case it is considerably expanded.

The class action

If approved as a class action, the main class of plaintiffs appears to include all US nationals in the USA, "who are or were owners, possessors, purchasers, creators or sellers of virtual land or any other items of virtual property or items as participants [of Second Life] at any point between November 14, 2003 and the date of class certification."

A subclass of plaintiffs are those who have had their Second Life assets "deliberately and intentionally converted, taken, 'frozen', or otherwise rendered unusable by Linden Lab."

The main class certainly numbers in seven figures. We're not really sure how large the subclass might be.

The counts

  • Violation of the California Consumer Legal Remedies Act, California Civil Code § 1750
  • Violations of the False Advertising Law, California Business and Professional Code § 17500
  • Violation of the California Civil Code § 1812.600 (governing auction transactions)
  • Violation of the California Unfair Competition Law, California Business and Professional Code § 17200
  • Fraud and/or fraud in the inducement
  • Conversion
  • Intentional Interference with Contractual Relations/Prospective Economic Advantage
  • Unjust Enrichment
  • Wrongful Expulsion

Whew.

If you're wondering why California codes are so prominent among the counts, it is because Judge Robreno already ruled during the Bragg case that the Lab's Terms of Service (and associated conduct) are subject to California law.

It is ironic, perhaps, that the Lab's own contractual knee-jerking from the Bragg case has probably led it into this one. Many of the changes that the Lab has made to its Terms of Service as a result of that case form a part of the basis for the current complaint.

The complaint requests a jury trial. While it's always difficult to predict which way a jury is going to jump as far as verdicts are concerned, juries tend to be significantly more sympathetic to "the little guy" in class actions. The lawsuit has its own Web-site that has just gone up where past and current users can apply to join the class action.

Of the three current lawsuits against Linden Lab (that we know of) this is probably the one to watch. Judge Robreno already has background, Archinaco has had time to hone and refine his arguments, and Linden Lab is probably not in an adequate position to settle this time around.


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This article was originally published on Massively.