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Plugged In

Sony ruffles feathers with “no suing” update to user agreement

Plugged In

If you're hoping to launch a class-action lawsuit against Sony, you might want to read the new terms of service of the PlayStation Network really closely before agreeing to them.

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Sony has amended the user agreement it requires gamers to digitally sign off on before they can access the online functionality of the PS3 -- and it's got a whopper of a change intended to dissuade players from litigating.

In a new section of the terms (called "Binding Individual Arbitration"), users are told they must waive the option to open a class-action lawsuit against the company on issues surrounding online services.

"Any Dispute Resolution Proceedings, whether in arbitration or court, will be conducted only on an individual basis and not in a class or representative action or as a named or unnamed member in a class, consolidated, representative or private attorney general action," it says.

The action, of course, comes just months after the PlayStation Network was the victim of the largest hacking incident of all time -- something that has inevitably launched a number of suits against the company.

Lawyers say the stipulation is certainly within Sony's legal rights, even if it could raise the ire of players who are just starting to calm down after the security breach.

"Yes, I think it's bad PR by Sony, and they could have handled it differently, but they're certainly within their legal rights," said Michael Pachter, an analyst with Wedbush Securities and a licensed attorney.

While word of the changes is causing ripples in the gaming world, it's worth keeping in mind that users can still file individual suits against the company if they feel wronged. And, generally, class-action suits don't result in windfalls for most of the people who are part of the class.

Shareholders of Take-Two Interactive Software learned this in 2009, when they tried to hold the company accountable for not considering a buyout offer from Electronic Arts. Take Two settled the suit without paying any monetary damages.

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