Valves faces $900 million lawsuit, accused of abusing its dominance in PC gaming to over-charge for games and DLC, as UK court says the case can continue

The UK Competition Appeal Tribunal has approved for trial a 2024 lawsuit accusing Valve of exploiting its dominant position in PC gaming to charge more for games and DLC. The suit is seeking a payout of £656 (approximately $900 million by current conversions) on the grounds that up to 14 million gamers in the UK may have overpaid £22 to £44 for games in the designated period from June 5, 2018.

The lawsuit caught some attention in June 2024 when Vicki Shotbolt, self-described as "a leading campaigner for children's digital rights" now seeking to act as the proposed class representative (PCR) for the suit, accused Valve by way of "Steam You Owe Us." The group's website insists, in bold text, that, "Importantly, Vicki will not profit from bringing the claim" to court.

Per a January 26 judgment before The Honourable Mr Justice Hildyard, Paul Lomas, and John Davies, the CAT ruled that the case can proceed to trial. This does not represent a ruling, or even an indication, on the outcome of the case. It basically means the case has not been thrown out.

The key line is this: "For the above reasons, we conclude that the Pro-Sys Test is met and that the collective proceedings can be effectively tried as regards the PPO Issue."

Now let's unpack that.

Shotbolt and her legal representatives claim Valve's position and policies block game publishers from selling games, add-ons, and DLC at an earlier date or cheaper price on other digital stores, and say that additional content is tied to games purchased on Steam in that it cannot be purchased via another seller and then accessed via a base game bought on Steam. Shotbolt's case partly hinges on PPO (platform parity obligation) terms purportedly limiting options via alternative sellers, and also takes issue with the default 30% commission Valve takes from Steam transactions.

Valve argued the case should not proceed to trial, largely on the grounds that the alleged anti-competitive accusations didn't bear analysis and that much of the submitted analysis was working off of stores in different markets (like e-books), but the tribunal has allowed it to continue.

A recurring counterpoint in the case is the impact of Steam keys, which are regularly traded outside Steam itself on stores like Humble and Fanatical. Valve says these keys reduce the impact of Steam's commission and allow off-platform deals. Valve also alleges the applicant's case had "not shown" how to "credibly estimate the impact of Steam Keys on Valve's commission." Additionally, Valve says the PCR would still have to show that game prices "would actually have fallen" if the relevant PPO clauses had been removed.

"It was only from Valve's Response and Mr Peterson's Witness Statement that the PCR learnt that Valve does not earn any commission on Steam Key sales," the judgment confirms, but the PCR pressed the issue.

The tribunal rejected the Steam key smokescreen, saying: "We were not persuaded by Valve's attempt to position the Steam Keys issue by reference to individual Steam Partners (or Games). That would render any such abusive pricing claim next to impossible to bring."

If this whole thing is starting to sound extraordinarily messy – between who sets prices for games on Steam, how Steam keys are calculated, and how the proposed compensation would be determined – that's because it is.

The CAT, evaluating the case against the two-pronged standards of the Pro-Sys Test (or, hilariously, the Microsoft Test), determined there's at least enough to go on regarding "unfairness" and "excessive pricing" for the suit to go to trial. Now it has to hold up.

"We do not underestimate the challenge of demonstrating, at trial, that the PPOs had an effect on the competitive structure of the market such as to constitute an abuse of a dominant position or of attributing a price impact to that effect, even with a broad axe, to estimate the damages due. However, we are at the certification stage," the judgment reads.

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