In 2014, charges were filed against Valve in court by the Australian Competition and Consumer Commission (ACCC). Claims were made that Valve’s Steam Subscriber Agreement, and Refund Policy, were misleading or all together lacking. Presiding councilor Naomi Sharp argued that Australian consumers had a right legally to a refund if sold a faulty or defective product. It was found that Valve did not honor their agreement to the court’s standards.

The case has seen two judges and multiple delays, hearings, and depositions. If this seems confusing given that Steam users are able to be refunded, keep in mind that this was not the case in 2014. While in cases where a game may be unfinished, unplayable, or if a game is pulled, consumers could receive a goodwill refund, there were instances where users were not given any refund at all.

Justice Edelman, presiding judge over the case, would find fault in Valves polices earlier this year. Making a firm statement, contrary to Valves argument that they are an American company doing business with foreign consumers, that Valve is doing business in Australia and are indeed bound by Consumer Laws.

“The Federal Court’s decision reinforces that foreign based businesses selling goods and/or services to Australian consumers can be subject to Australian Consumer Law obligations, including the consumer guarantees, In this case, Valve is a US company operating mainly outside Australia, but, in making representations to Australian consumers, the Federal Court has found that Valve engaged in conduct in Australia.”

This ruling set precedence that companies must adhere to laws within Australia, even if the company is based in another country. Ultimately, this put Valve’s argument to rest. After three years of proceedings a ruling had finally been made in favor of the ACCC.

“It is also significant that the Court held that, in any case, based on the facts, Valve was carrying on business in Australia.”

It was also noted in the ruling that for the first time goods would also include software in the ACL. With so much becoming digitally available in the world from every corner of the globe, such findings are a pretty big step in understanding international consumer rights. The judge had this to say on the matter:

“This is also the first time Courts have applied the extended definition of ‘goods’ to include “computer software” in the ACL. It will provide greater certainty where digital goods are supplied to consumers through online platforms.”

Flash forward to November 15th, this past Tuesday, to a hearing intended to argue what Valve should be fined in this case. Presiding counsel for the ACCC Naomi Sharp argued that management at the senior level was involved in misleading Australian consumers and thus in violation of the law. Their argument lead to a hefty fine of $3 million dollars.

Valve’s counsel Karl Quackenbush argued that their Steam Subscriber Policy stated they do not give refunds, though this is in direct violation of Australian law. He also argued that their conduct was never intended to mislead consumers, and that a fine of $250,00 was fair. To that Justice Edelman had a biting question in response:

“Your proposed penalty of $250,000 isn’t even the price of doing business, it’s next to nothing is it?”

Valve also called to question how an Australian court could enforce such judgment on a foreign corporation. The exchange between Justice Edelman and Valve’s attorney’s was interesting to say the least. Justice Edelman conceded stating

“Lurking behind the remedies hearing is the deeper question of enforcement of penal orders in a foreign jurisdiction. And the rule against enforcement of revenue or penal orders may mean in a foreign jurisdiction is that it wouldn’t be able to be executed,”

After this statement Valve’s attorneys were asked if they would resist any penalties from the court. Their response was that no instructions were given to resist any court orders. It would seem that Valve plans on being compliant, which may be costly but would avoid greater negative publicity.

With all arguments heard and submissions from both sides finalized, the court was adjourned. Justice Edelman let both sides know that a ruling would be handed down covering penalties and any injunctions by mid-December or January at the latest. Until then, Valve will have to wait and see what fate awaits them over this case.

What are your thoughts on the ruling? Do you think the price is too high, or should companies selling software over seas be held accountable to the laws of the countries they sell to? Sound off in the comments below!