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this post was submitted on 27 Sep 2024
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Arbitration is always cheaper and faster than the courts, because the courts are very backed up especially since the pandemic, and there's a lot of admin cost which doesn't exist in arbitration. That is why almost every other company is trying to force arbitration. So if the goal was to save money, forcing court would have the opposite effect.
My thought was that a lawsuit is more expensive than arbitration, but settling a class action lawsuit is cheaper than thousands of arbitrations.
If you push everybody into a class action, it will be cheaper. Have you ever gotten more than a cent on the dollar from a class action settlement(unless you're the class representative)? Sure the seem like the settlements are a lot of money, but if you can get the class action settled with very few claimants, no one will be able to sue over that particular issue again, so it puts it behind the company. Instead of being dogged by individuals for however long.
If you push everybody into arbitration, you've already got the arbitrator in your pocket and your costs will still be less than litigation in 99% of cases - even class action. I don't think you understand just how long and expensive and unpredictable litigation can actually be, but I've brought suit before so I do. It took four and a half years to get an initial court date from first filing the complaint. Not the trial, just a date so the judge could hear the facts of the case and opening statements from attorneys. Four and a half years of paying my attorneys, as a private individual, with a lot less money than you might think. And they were giving me mate's rates; I've worked with companies where the legal work billings were in the tens of thousands per day for a single participating law office. That shit is expensive.
Maybe Valve did this to fuck their customers, but they don't really have a track record of that, and since in the majority of cases arbitration is without question an anti-consumer move, I'd say that if your aim is to paint Valve to be the villains for this then it's going to be an uphill battle.
I can tell you that I have arbitration on going, and it's been well over a year that it has been happening. To assume that the arbitration wraps up in a month, when you've got lawyers involved is non-sense. I don't believe arbitrators are in anyone's pocket either. The arbitrators aren't in-house council for Valve, they are a company Valve has contracted with, and they're going to be neutral, and rule based on law, not who's paying. As a lot of arbitration rules state that if you take the case to arbitration and lose, the one that is ruled against pays for the cost of the arbitration. Based on the "mate's rates", I'm guessing you're UK based. I don't know that legal system, so can't say how fee structures work. But a great deal of lawyers that are suing on behalf of you, in the US, take a percentage of the settlement. So the biggest cost is all to the person being sued, as they do pay the lawyers by the hour instead of a cut of the ruling.
I don't think Valve is changing their rules to screw customers, I think they're doing it because they've found separating each case into a different arbitration claim is too expensive. And it would have been better for them all to be in one group. I believe Valve is the best game distributor, as it turns out. But if people with law degrees think they've broken rules, I'm all for punishing rule-breaking. In this particular scenario, it seems like it might slightly improve things for consumers, and greatly benefit small studios.
If you think that an arbitration company isn't going to end up sympathetic to the people signing their cheques after some amount of time in operation, I'm afraid I have some bad news for you. Even if the loser pays (and that's not a guarantee, some companies foot the bill regardless to make it seem like the better option to the consumer), it's still the company contracting the arbitrators and the consumer doesn't get a look in on that, so future business is absolutely an incentive to put the thumb on the scale. "After all, both parties agreed to be bound and waive their right to trial, so what are consumers going to do?" is the logic. Most will drop it after losing arbitration, and there are savings on court costs there too.
I don't assume arbitration wraps up in any arbitrary amount of time (๐ฅ). I say it's quicker than litigation because it is, every single time. Because it is quicker it is also cheaper, every single time. Small claims court is different again, and not at question here, just to head that off at the pass.
You however do assume a lot like my location and the location of the suit I brought though, based on my vernacular, and I'd recommend against that. "Mate's rates" could put me in the UK, or Australia, or New Zealand, or even some places in South Africa and other former colonies. None of those would be accurate.
my wife got a few hundred bucks from a feminine hygiene product, unless you count that as "cents on the dollar" meaning a percentage of the final amount - in which case, that's the case in every settlement.
What I meant by cents on the dollar is usually, they broke rules, make $100 billion from it (imaginary scenario), and then the settlement from that wrong doing sees them pay out $2 billion to the affected customers that joined the class. It may be due to the fact that I've not paid attention to too many class action suits, but it seems like the settlement never comes close to the harm they caused.
Accurate. In order for this to stop the punishment needs to be more than the cost of doing business. Thankfully, Valve seem to be hell bent on doing right by their customers, in most cases at least (just to leave room for scandals I haven't heard about or forgot ๐ )