Sorry good readers; I couldn’t resist this case. Does the UCL or CLRA protect virtual characters in a virtual world existing only on-line against virtually fraudulent transactions? Magistrate Judge Ryu in San Francisco said, for the most part, no. (Evans v. Linden Research, Inc. 2012 WL 5877579 (N.D.Cal. 2012)). This putative class action involves the internet role-playing virtual world entitled Second Life. In Second Life, participants create characters called avatars to represent themselves and to interact with other avatars in a huge virtual world. Participants establish reputations, run and patronize businesses, and buy and sell virtual items such as clothing, cars, and homes (referred to as “virtual items”). They also purchase and sell pieces of “virtual land” from Defendant Linden Research, Inc. (“Linden”) and other participants. Participants use in-game money, known as “lindens,” to perform in-world monetary transactions. The linden currency can be purchased with, as well as exchanged into, U.S. dollars.Linden retains and stores virtual items and virtual land on its servers. Participants with virtual land must pay Linden monthly “tier fees,” similar to property taxes, that vary in amount depending on the size of the virtual land that they possess. According to Linden, these tier fees help pay for the maintenance of the servers on which the game data is stored. After purchasing virtual land, a user may “inhabit” it, rent it out, split it, and/or resell all or part of it to other participants. Linden continually creates “new” virtual land; once Linden sells land to a participant, it continues to exist in Second Life and is not deleted or removed from the game. At some point, reality reared its head in the virtual world. (Ed.) According to Plaintiffs, sometime after 2007, following a dispute with an individual user regarding Linden’s alleged confiscation of virtual property, Linden abruptly removed the word “owned” from the statement on its homepage, so that it became: “SECOND LIFE IS AN ONLINE, 3D VIRTUAL WORLD, IMAGINED AND CREATED BY ITS RESIDENTS.” Plaintiffs allege that after years of representations by Defendants about ownership, designed to induce users to invest U.S. dollars in virtual land and items, Linden began to strip ownership rights from its users.
The court concludes that Plaintiffs have not sufficiently demonstrated injury-in-fact to meet the requirements for standing to bring the CLRA, FAL, UCL, and fraud claims on behalf of the Main Class. In their motion for class certification, Plaintiffs did not describe any economic harm they allegedly suffered as a result of Defendants’ alleged misrepresentations about ownership. Plaintiffs offered a theory of economic harm only in their reply brief: “Plaintiffs either would not have purchased virtual land or items at all, or at least would have paid less for the land and items had Defendants not misrepresented that Second Life users would ‘own’ the land and items, and not merely ‘license’ the land and items.” (Pls .’ Reply 2.) The problem is that Plaintiffs did not offer a shred of evidence in support of the existence of any such economic injury.
The Court did, however, certify a class of those virtual participants who were dragged kicking-and-screaming out of the virtual world; i.e. those whose accounts had been cancelled. “For the reasons set forth above, Plaintiffs’ motion for class certification is GRANTED only as to Subclass A, which shall be defined as follows: All persons whose assets, including virtual items, virtual land, and/or currency in lindens and/or U.S. dollars, have been deliberately and intentionally converted by Defendant Linden’s suspension or closure of their Second Life accounts.” But, those remaining in virtual reality were left with apparently, well, virtually nothing. Okay, now back to your regularly scheduled non-virtual reality.