Bellevue-based video game company Valve is facing a class-action antitrust lawsuit filed Friday in the U.S. District Court for the Western District of Washington.
The suit, which names a handful of gamers as plaintiffs, alleges Valve stifles competition to its platform Steam, a place for gamers to buy and play PC games. Key to the lawsuit is what is called a platform most-favored-nation (PMFN) clause, an agreement between a platform and a seller that dictates a seller won't sell for a lower price on a competing platform.
"Valve’s PMFN requires Steam publishers to charge the same price (for the same content) wherever those games and in-game products are sold, even though underlying platform fees can vary significantly," the lawsuit's complaint reads. "This thwarts rival platforms’ ability to seize market share from Valve by offering lower platform fees."
According to the complaint, Steam takes 30% of the revenue publishers get from game sales on the platform. The suit alleges Steam has a dominant position in the distribution of PC games, and game publishers can't afford to be removed from Steam for offering a lower price on a competing platform. Without the PMFN clause, the suit alleges, publishers could sell on platforms with cheaper fees, in turn passing savings along to consumers and pushing prices down across the market.
Valve didn't immediately respond to a request for comment on the lawsuit.
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The lawsuit alleges well-funded competitors like Microsoft and Amazon have tried to launch competitors to Steam but have failed to gain traction because of the Valve PMFN clause. The plaintiffs have asked for a jury trial, and they are seeking damages, attorneys' fees and an injunction to stop Valve's restrictions on publishers.
Valve is facing a similar lawsuit filed in 2021 by Berkeley, California-based Wolfire Games and consumers. The suit also alleges publishers are forced to keep prices high due to Steam's stranglehold on PC game distribution and its 30% cut of all revenue. That lawsuit is ongoing.
Valve was founded 1996. The company makes popular games like Dota 2, Half-Life, Counter-Strike and Left 4 Dead. Dota 2's popularity has led to an annual tournament called The International that offers millions of dollars in prize money. Seattle's Climate Pledge Arena hosted The International last year, and the event will be in Copenhagen this year.
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