Revisiting the Top Stories of 2012: Lawsuits Faced by Electronic Arts

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Posted December 22nd, 2012 at 2:15 pm

ncaa13cost

Two high profile lawsuits against Electronic Arts carried into 2012 with one being settled and another steaming ahead towards a trial. Though the former is now filed away and ended up having very little in the way of lasting impact the other threatens the viability of any college sports video games in the future. 

There were some out who held out hope that an eventual judgment in favor of the plaintiff in Pecover v. Electronic Arts would overturn the exclusive NFL license. That was never the target of the action however. The claim was that after securing the exclusive license for the NFL, NCAA, and Arena Football that all football competition was eliminated allowing EA to raise the price of their products.

Even though the merit of the case was sketchy at best the potential of what a negative judgment for EA would mean led them to settle. The result was a $27 million pool that would be split up among claimants - up to $6.89 for each PS2/Xbox/Gamecube game and $1.95 for each 360/PS3/Wii game maxing out at $69.92 total. Should there be more claimants than those numbers allow for the payouts will be reduced. The agreement also stated that EA Sports can not pursue an exclusive NCAA license for a five year period. Nothing changes with the NFL.

The settlement in the end won’t have much influence on the future of sports gaming or hurt EA all that much. Yes, $27 million is a lot of money, but to put it in proper perspective that wasn’t even half of what Madden Ultimate Team mode made in Madden NFL 12 alone and was less than the cash the NFL gave back to EA under the threat of a potential lockout year. Additionally no other company will have interest, or the resources necessary even if they did, to produce a college football game in the coming years. One big reason why relates to the other big lawsuit still making its way through the courts.

The player likeness lawsuit against the NCAA, CLC, and Electronic Arts is the culmination of two high profile filings that were combined as led by Sam Keller and Ed O’Bannon. It alleges improper use of player likeness through various forms of merchandise and media including video games in which the parties in question conspired to avoid paying players for their rights. Some interesting details and claims regarding the case at hand were revealed when EA was reentered as a defendant after initially being dismissed.

EA has won a previous case regarding player likeness with the courts ruling video games are artistic works rather than commercial speech and therefore protected by the First Amendment. The Supreme Court last year established forms of media, producing expressive works of art, are not subject to judgments based on incorporating someone’s name or likeness.

Recent uncovered emails have shown that NCAA representatives were well aware that players in games were based off real-life players. At one point the NCAA and EA had nearly reached an agreement to have actual player names included in the products. The EA Locker/Roster Share feature was a fallback option.

This consolidated case in California looks as though it will be going to trial and ultimately be the determining factor of how the NCAA proceeds in the future handling broadcasting rights, merchandising, and video games. Should a negative result come down, which one analyst has pegged as being a potential loss of $1 billion for EA, it would likely not just end the NCAA Football series but also with it any realistic possibility of college sports games being made in the future. The NCAA is currently seeking to block classification as class action. The trial now is stated to begin June 2014.

Year in Review
Much more to come throughout the month!
•#8 of 2012: NHL 13
•#9 of 2012: NCAA Football 13
•#10 of 2012: NFL Blitz
•Vote for the 2012 Community Choice Awards
•Revisiting the Top Stories of 2012: Lawsuits Faced by Electronic Arts
•Revisiting the Top Stories of 2012: Disingenuous Marketing and Unfulfilled Features
•Revisiting the Top Stories of 2012: The Disastrous Road Towards NBA Live 13

  • Benne

    Sucks to think that college football could go the way of basketball. The game hasn’t been great but Id rather have that then nothing at all.

    • http://twitter.com/C_Joseph_J CJ

      I really hope NCAA 14 is decent though, since it might the last one for a very long time. It also means that unless it is truly mediocre again I will buy it, just to have the last version.

      • erod328

        If a negative verdict came down that shut down the NCAA Football franchise, do you think EA could continiously patch the last game that was released? Say a yearly patch that tweaks the game, hell you could even call it DLC. Calling it DLC you could justify having to pay a small fee. I’d drop some greenbacks to be able to implement a customizable playoff at the end of each year in dynasty mode.

  • http://www.facebook.com/cush2push Geoff Wightman

    I’m on board for a no exclusive licensing agreement on everything let competition and the consumer decide what games stay and what goes

    • http://pastapadre.com/ pastapadre

      In a perfect world that would be the case. But these are huge businesses that are going to think of their own interests first.

  • Alex

    I havent bought NCAA in 2 years… I always see people posting that. Never thought I would be one of them but I just dont see enough innovation.

  • joeCollege

    thank you Ed OBannon?

  • fantasyboi

    Time to go all out on NCAA 14 EA….

  • H-Town

    I wil be upset to see NCAA go away, i much rather NCAA over Madden, i truely do not want to see all the college games to go

  • Keith.

    Here’s another suit that EA lost recently — haven’t seen it reported anywhere:

    http://www.jdsupra.com/legalnews/december-2012-sports-litigation-update-44646/

  • Keith.

    It’s not a slam dunk that EA’s going to get out of the Madden Monopoly lawsuit so easily. I filed an objection and I don’t know how many others did, too — but the Center for Class Action Fairness got their objection filed and they’ve successfully objected to other proposed class settlements before, so we’ll see:

    http://www.pointoflaw.com/archives/2012/12/pecover-v-electronic-arts-class-action-settlement-objection.php

  • Keith’s Dad

    Congrats Keith. This website is heading in the direction Keith has been planning. Way to go Keith!

    • Keith.

      Are you the same guy who’s been posting as “I hate Keith”? If so, sorry you don’t like reading stories about all the legal troubles EA’s having with its football games. To a few of us, it’s the biggest story out there — we’ve had to play below par football games for 8 years now, and I ain’t ever getting that time back.

      But don’t worry, there will be another Madden ratings thread up again soon I’m sure. Just try to stick with those if you don’t like reading these EA legal threads.

      • http://www.facebook.com/people/Iown-You/100000775565221 Iown You

        Exactly! It’s like nobody wants to hear or face the truth anymore.

  • MoneyMayweather

    Pasta was balling out at the seahawks game.

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