With the growing buzz around Diablo 3’s in-game auction system comes several tricky questions about how the virtual world and the real world should interact. Issues like taxation, property rights or possible litigation between players become legitimate once money enters the system. Each MMO will have their own unique ways of addressing these problems as they draw the line between seriousness and play. Maintaining that division means making sure the play world can resolve its own disputes to the satisfaction of players and developers.
Let’s start with why our current legal system should be kept out. For most MMOs you don’t have any property rights and until recently you could not even sell the items legitimately for money. The game needs this because anytime the designers need to nerf an item or character it will lose value on the market. This could very easily cost thousands of people money. Considering they’re already unhappy because their in-game prowess is reduced they will be all the more upset that their wallets are being hit. Expansions and updates are the lifeblood of an MMO and the only way to make them possible is by keeping ownership of the items strictly in-game. The developer can’t be concerned with legal liability if it’s going to maintain the game.
It’s also unlikely our current legal system would be any help for resolving in-game disputes. Picture the following e-mail going out:
I have this Elvish Bane Sword in Diablo 3 but unfortunately my account has been banned. If you just give me the password to your account, I can get the sword. Of course I would be happy to give you a small cut of the profits from the sale.
Someone falls for it, gets stripped of their possessions and wants their cash value back. First, if the person lives in another state or country you have massive jurisdiction problems for even bringing the lawsuit. A person outside your own nation does not have to obey your laws or care about a claim brought against them. Second, if you don’t have any property rights to the item then you don’t have any grounds for suing them anyways. Even if the EULA or ToS contains some clause about theft it won’t help you get your money. The contract is between you and the game company, not the person robbing you. Third, if the person turns out to be a minor it’s debatable whether they are bound by the contract anyways.
The thing that keeps all of these issues out of the game is the EULA. It’s not that the courts don’t recognize the potential for property rights, it’s that everyone playing them signs a contract agreeing that they don’t own anything in-game. For the most part this creates an effective legal barrier that has survived several lawsuits for different games. The problem is that, as with any click-wrap contract, they contain the litigation by insisting you resolve your problems with arbitration. This has been an effective deterrence to litigation because of the expense and the fact that business wins 96.8% of the time. It takes extraordinary circumstances for a court to rule that an arbitration agreement is unfair.
While the solution may be effective, it obviously has a couple of problems even if it keeps working. Presuming that the addition of real world auctions increases litigation, defending the EULA will cut into the game’s profits. The EULA isn’t going to protect player versus player property disputes. Furthermore, EULAs are increasingly viewed negatively by consumers as companies use them to change their contract terms, fostering distrust and negative perceptions.
What could potentially threaten a EULA is if the courts decide a person has been forced into an unfair bargaining position. The hypothetical scenario would be someone accumulating a large amount of virtual wealth and then being forced to agree to new terms in a EULA which damages them. They can’t transfer the money out of the game and they don’t have any kind of recourse inside of the game either. It’s a question of options given to the player, do they have an alternative besides signing a contract that hurts them? If they do not, then the courts may step in and take matters into their own hands.
The majority of MMOs practice a kind of authoritarian approach to governance. They own everything, they resolve all disputes on their own, and they decide how to design the game on their own. Input is evaluated from the players but no real authority is granted to them. Enforcement occurs either automatically or through GMs. Both of these methods of enforcement are problematic. Automatic enforcement means the developer is often acting without proper feedback because there are no immediate costs to their rules. Nor can players break the rules like they do in real life: invisible walls and code law are final. It’s arbitrary and often leaves the player feeling powerless when bold changes come out for the game.
GMs, on the other hand, can be inconsistent. A forum thread on GMs in World of Warcraft at MMO-Champions gives a pretty common example of how this gets expressed. One player thinks the community rule about no swearing should be more heavily enforced, so they constantly report these players to GMs. Others don’t see it as a big deal while several others didn’t even know it was against the rules since the game self-censors. A thread on rpg.net points out that GMs must deal with everything from code issues, gold farmers to social conflicts and harassment. Results vary depending on the GM’s background even though they are all lumped together. Another thread allakhazam complains that they feel increasingly like a subscriber rather than a customer. There are so many complaints that GMs can’t attend to them all and the issues go unresolved.
Greg Lastowka in his book Virtual Justice points out that the biggest problem with GMs is their inconsistency. You can just hassle a different one until you get the result you want by filing complaints over and over. This kind of conflict resolution may suffice in the current MMO system, but as real money enters the system many players are not going to take arbitrary decisions lightly. As Lastowka explains, “When virtual worlds empower users with a wide range of creative freedom and encourage them to take economic ownership in their productions, those worlds are more likely to attract lawsuits from all directions. Large scale financial stakes and uncertain rules are a dangerous mixture.”