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A law firm was trying to extort Valve with 75k arbitration claims which would cost $3k per claim ($225mm total). As an alternative they offered to settle for $2.9k per claimant.
In the 5 years since the binding arbitration was introduced valve has had only 3 arbitration cases and won all three.
Summarized from the article.
Thanks for sharing that info - I was just going off the recent headlines
To your second point, don't companies normally win arbitration cases? I thought that was the whole point of it all - to make it easier for a company to win lawsuits
Yea, it looks like the win rate for consumers in arbitration is less than 1%. I'm not sure what consumers win rate is in court but it must be better than that.
If it wasn't better than that, no company would want arbitration cases.
We write to provide a case update and to ensure you that we are aware that Valve has updated its Steam Subscriber Agreement to remove the mandatory arbitration provision. Unless you hit “Agree,” those terms will not go into effect until November 1, 2024.
We believe Valve’s tactics are legally dubious and are analyzing all options on behalf of our clients. We will do our best to answer individual inquiries, but will update all clients on “next steps,” in this respect.
Valve’s changes to the agreement flow from a series of losses and failed settlement efforts to pick off certain clients whose arbitrations had been moving toward merits hearings.
Update on Arbitrations to Date and Global Mediation Scheduled With Valve (Please Keep This Confidential)
As background, our early discussions with Valve reached an impasse last fall, and we filed an initial round of arbitrations at that time. Arbitrators were appointed in those cases and Valve filed motions to dismiss. All of these motions have been rejected by the Arbitrators and multiple trials were scheduled.
In the pending arbitrations, we had multiple hearings to compel Valve to turn over incriminating documents that are necessary to prove up the claims. Simultaneously, we intervened in the federal class action to oppose Valve's motion to seal or redact the vast majority of evidence provided in connection with the developers' motion for class certification, and the Judge in that action ordered many materials be unsealed.
In August, we received favorable rulings on many of the motions to compel and Valve was ordered to turn over voluminous materials.
On the eve of having to produce documents – at the risk of violating arbitration orders - Valve replaced its lead counsel and the new lawyers reached out seeking to re-engage in global settlement discussions. This time, they agreed to pay for the appointment of a well-respected mediator (a neutral go-between) to facilitate those discussions. This was something we proposed nearly a year ago at the outset of the cases, but it took several victories on our end to get them to the table. The global mediation is currently scheduled for late January 2025. In connection with the mediation process, we are also currently negotiating a tolling agreement with Valve that will toll all limitations periods on your claims.
While this isn't a guarantee a settlement will be reached, we view it as a good step and have had more constructive discussions with Valve's new counsel.
While we prepare for mediation, we are also getting ready to try the initial cases filed in the event of another impasse. If it comes to it, our goal with the early arbitrations is establishing good precedent against the Company that we can use in future cases if necessary.
We recognize the delay if frustrating. Valve is a big company with no shortage of lawyers who are attempting throw up road blocks. However, we are working hard to try to advance discussions and to pursue your legal rights.
All the best,
Jeff Zaiger and Judd Linden