A judge from the Small Claims Court in the State of São Paulo has ruled that a console operator cannot permanently lock the console in case of a user’s violation of the Terms and Conditions. According to the court’s ruling, under the Consumer Defense Code, blocking the user’s ID, even if established in the Terms and Conditions, may be considered as an abusive penalty since the user has no opportunity of defense nor the opportunity to remediate their fault.

In the case at hand, the console manufacturer suspended the user’s account and access to the online gaming network, due to the irregular download of free games on the gaming network and sharing them with other users. The plaintiff filed a complaint with the Small Claims Courts of São Paulo, requesting for an injunction to reverse the penalty and an award for emotional distress.

The court ruled that the penalty was unacceptable because the Terms and Conditions of the gaming network are too broad and only mention the general possibility of a blocking penalty, without linking it to any specific behavior/conduct. Besides that, the court also ruled that the penalty was disproportional because the blocking would render the device useless and depreciate its market value. The court rejected the request for an award for emotional distress on the grounds that it was the user who violated the Terms and Conditions and gave rise to the situation.  

The console manufacturer already filed an appeal seeking to reverse the decision, and the case in pending to be remitted to the Small Claims Court Appellate Bench.

In the coming months

The Small Claims Court Appellate Bench will rule on the manufacturer’s appeal. Although this may be the first time a Brazilian Court rules on a gaming platform’s TCs, rulings from the Small Claims Court are known to adopt a very equitable approach and are not considered as precedent or as case law. If, however, the judgment will be upheld, it can have consequences on the TCs employed by console operators and platform providers, which generally reserve the right to block users from using the service if the user violates the TCs. This could also apply to mere software-related gaming platforms or video games if the user will not be able access purchased games or in-game items and other software due to the blocking of the account, as the argument of the court on disproportionality can technically be applied in this scenario as well. In any case, it is important to keep this on the radar, considering the size of Brazil’s videogame market and the Brazilian consumers’ inclination to litigate.

Author

Tiago C. Vaitekunas Zapater joined the Firm in 2011 and became partner in 2016. He integrates the Dispute Resolution practice group, with focus on class actions, environmental litigation, product liability, internet litigation and complex litigation in general. Tiago C. Vaitekunas Zapater has a wide breadth of experience in environmental and urbanistic litigation.

Author

Andrea Brick joined the firm in October 1998 and became partner in 2011. She is part of the Dispute Resolution team and leads the practice in Rio de Janeiro and Porto Alegre. Andrea Brick is experienced in corporate litigation, representing leading companies in the telecommunication, entertainment, mining, and oil &gas areas. She has experience in lawsuits involving environmental and consumer issues, including class actions. She works in intellectual property cases, with experience in copyrights, unfair competition issues and trademark violation. Andrea Brick acts on arbitrations and she is experienced in mediation, including international mediations. She also assist clients in pre-litigation matters and contractual analysis.

Author

Maria Cristine Lindoso joined the Firm in 2015. She integrates the litigation practice group, with focus on Superior Courts. Ms. Maria Cristine Lindoso has a wide breadth of experience before the Superior Court of Justice and the Supreme Court.

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