14 DAY TRIAL // When it rains legal problems on Electronic Arts, it really pours. The company has recently come under Federal Trade Commission investigation because of its attempt to take over Take Two. And now, another investigation is threatening the very heart of Electronic Arts, its sports division. Gamers in Washington, D.C. and in California are taking the company to court over allegations of "blatantly anticompetitive conduct" related to the way EA is using its exclusivity agreements for American football games.
The class action complaint attacks Electronic Arts for some of the things it has done back in 2004, as Take Two released a game called NFL 2K5. The game was a direct competitor to the Madden series from EA. The Take Two product was aggressively marketed and priced lower than the Electronic Arts one, so it managed to get a fair chunk of the market, with over 2.9 million copies of the game sold in the United States. After quickly slashing its own prices, Electronic Arts chose to enter several exclusivity agreements with the governing bodies of American football, thereby depriving Take Two of a license and making sure that the Madden series was the only one available on the market.
The suit filed with the court claims that "This vigorous competition benefited consumers. Electronic Arts could have continued to compete by offering a lower price and/or a higher quality product. Instead, Electronic Arts quickly entered into a series of exclusive agreements with the only viable sports football associations in the United States: the National Football League, the Arena Football League, and NCAA Football."
After Take Two was taken out of the market, Electronic Arts again raised prices on its own game and made sure that attempts by competitors to enter the American football simulation market were thwarted.
The plaintiffs are asking for no less than full restitution of damages for all those who bought a Madden game beginning with 2005 and an end to all practices that are anti-competitive.
Electronic Arts is refusing to comment on the class action complaint.