Pokémon No! How Pikachu Ended Up Getting Served with a Class Action Lawsuit

August 10, 2017 Law, Litigation Comments Off on Pokémon No! How Pikachu Ended Up Getting Served with a Class Action Lawsuit

Remember Pokémon Go? About this time last year, the “augmented reality” game in which players use their smartphones to capture and train various species of Pokémon was a global phenomenon, with nearly seven million daily downloads. It was sort of the “thing to do” of Summer 2016.

While Pokémon Fever has certainly subsided a bit, the game still has plenty of rabid fans. In fact, last month’s Pokémon Go Fest in Chicago drew 20,000 Pokémon Go die-hards to the city’s Grant Park. The Fest was billed as a chance for Pokémon Go “trainers” to compete against each other and bag rare Pokémon characters. Instead, as it turned out, attendees encountered hours’ worth of lines, a lack of data connectivity, problems with the game’s software, and malfunctions of the game’s servers. The Fest has been almost unanimously derided as a disaster.

In an attempt to quell the uproar regarding the fiasco, Pokémon’s parent company, Niantic, Inc., has offered to refund attendees’ the price of admission ($20) and give them $100 of in-app purchase credit. While definitely a nice gesture, that compensation isn’t cutting it for many Pokémon trainers who traveled from across the country, and the world, to attend.

One disgruntled Pokémon Go fan from California has gone so far as to file a class action lawsuit against Niantic on behalf of all who attended Pokémon Go Fest, seeking damages for, among other things, violation of the Illinois Consumer Fraud Act, which broadly prohibits unfair or deceptive business practices. The suit seeks to have Niantic reimburse Fest-goers for their travel and accommodation costs. It also goes after punitive damages to teach Niantic a lesson.

Virtually every state in the Union has a similar “consumer fraud” or “deceptive trade practices” statute. These statutes are designed to protect the public from business activities by that are meant to mislead consumers into purchasing a given product or service.

While each state varies in how offenses are dealt with (i.e. whether a private lawsuit can be filed or a class action is available), the acts that are illegal are at least fairly uniform across state lines. They usually include:

1) False representation of the source, sponsorship, approval, certification, accessories, characteristics, benefits, or quantities of a good or service (Niantic could have a problem here);
2) Representing goods as original or new when, in fact, they are deteriorated, altered, reconditioned, reclaimed, or used;
3) Falsely stating that certain services, replacements, or repairs are needed;
4) Advertising goods or services with the intent of not selling them as advertised, or with the intent of not having enough in stock to meet reasonably expected demand (another possible problem area for Niantic);
5) Disconnecting, turning back, or resetting the odometer of a vehicle to reduce the number of miles indicated;
6) Passing off goods or services as those of another (i.e. selling counterfeit goods); and
7) Representing goods or services as having a sponsorship, approval, sponsorship, or certification of goods or services.

Many of these seem like no-brainers, but as a consumer, it is important to know your rights, and if you are aggrieved to know that you may very well have the weight of a state statute behind you, in addition to common law claims for fraudulent misrepresentation and unjust enrichment.

As a business owner, it is crucial that you know when the conduct of your business may put you at odds with the consumer protection statute(s) in your state – so that you can do your best to make sure that you (as well as your employees and other representatives) DO NOT cross that line.

A little homework can go a long way in helping you protect yourself – both as a consumer and a business owner.

About the author

Jarom brings a wealth of experience in several diverse areas of law, but focuses his practice primarily on business formation and transactions, real estate, trademarks, estate planning, self directed IRA law, and civil litigation. Jarom has spent much of his practice helping entrepreneurs and small business owners across the country navigate the trials and tribulations of starting and operating a business. He has helped clients set up hundreds of business entities, drafted multifaceted business and real estate agreements, and represented companies large and small in complex contract, intellectual property and real estate litigation. He also routinely helps clients obtain and protect trademarks and other intellectual property.