French court rules country's Steam users can resell their games

Original story, September 19, 2019: The District Court of Paris has issued a ruling saying that French owners of digital games on Steam are permitted to resell them under EU law.

Next Inpact reports (as translated by GamesIndustry.biz sister-site Rock Paper Shotgun) that the court ruled in favor of the French consumer interest group Union fédérale des consommateurs, the Federal Union of Consumers on a number of clauses including the issue of digital resales.

The Federal Union of Consumers has been pursuing Valve for several years now over numerous issues in the Steam Subscriber Agreement. This particular ruling by the French court looks at Valve's claim that consumers do not actually purchase a digital product when they buy a game -- rather, they purchase a subscription to access and use content and services on Steam. The court's ruling classifies these sales as digital licenses rather than subscriptions, thus allowing them to be resold in the same way that physical games have been resellable.

Per the court, the prohibition against digital resales violates EU laws that maintain "the free movement of goods within the Union." All goods sold within the EU must be able to be resold without permission from the person who originally sold them.

Additionally, the court says Steam's terms claim a number of other rights Valve does not actually have, including keeping wallet funds without reimbursement when users leave the platform, relinquishing responsibility if users incur harm using the platform, as well as certain rights regarding mod use, user-submitted content, and account termination. A total of fourteen clauses were determined to be unacceptable.

Though Valve can still appeal this ruling within the next three months, the Federal Union of Consumers intends to use it to further other legal challenges against Steam both in France as well as in other EU countries.

"We disagree with the decision of the Paris Court of First Instance and will appeal it," a Valve spokesperson said to Polygon. "The decision will have no effect on Steam while the case is on appeal."

Update, September 23, 2019: The Interactive Software Federation of Europe has said the French court ruling last week contradicts EU law, and should be overturned on appeal.

"This French ruling flies in the face of established EU law which recognises the need to protect digital downloads from the ease of reproduction allowed by the Internet," said CEO Simon Little in a statement.

"Far from supporting gamers, this ruling, if it stands, would dramatically and negatively impact investment in the creation, production and publication of, not just video games, but of the entire output of the digital entertainment sector in Europe.

"If Europe's creators cannot protect their investments and their intellectual property, the impact on both industry and consumers will be disastrous."

In EU copyright law, there is the "exhaustion doctrine" which removes the copyright holder's rights to distribution after the first sale, essentially meaning goods can be resold.

However, according to the Tom Kabinent case concerning the resale of ebooks -- which is currently before the Court of Justice of the European Union -- there is grounds to suggest that the "exhaustion doctrine" does not extend to digital goods.

Additional reporting by Haydn Taylor.