Grand Theft Auto False Advertising Class Action Revived by 9th Circ.

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The 9th U.S. Circuit Court of Appeals has reversed the dismissal of a class action lawsuit against Take-Two Interactive Software Inc. and Rockstar Games Inc. over false advertising allegations related to their Grand Theft Auto V video game.

The appellate court sent the Grand Theft Auto class action lawsuit back to the district court and will allow the plaintiffs to file an amended complaint.

The Grand Theft Auto class action lawsuit was filed in October 2013 by plaintiffs Bruce McMahon and Christopher Bengston. The plaintiffs allege they purchased the Grand Theft Auto video game but were unaware that they wouldn’t be able to compete with other game owners online. They claim that, prior to the video game’s release, it was advertised as a “state-of-the-art game” that allowed up to 16 players to compete against each other online.

However, the plaintiffs state that the multiplayer competition features were not available at the time of Grand Theft Auto V’s September 2013 release. The features were not usable until several weeks after the release, according to the false advertising class action lawsuit.

McMahon and Bengston accuse Take-Two Interactive and Rockstar Games of misrepresenting the availability of Grand Theft Auto V’s online features. They claim that they wouldn’t have paid a premium price for the game if they had known the online features promised on the game’s packaging were not functional.

The Grand Theft Auto class action lawsuit asserted claims under California’s Unfair Competition Law and False Advertising Law.

In January 2014, the Grand Theft Auto class action lawsuit was dismissed by a California federal judge who found that the defendants never promised that the online features would be available immediately, and that customers did not suffer substantial harm from the alleged false advertising.

In its Feb. 19 opinion, the 9th Circuit disagreed with the district court’s decision to dismiss the Grand Theft Auto class action lawsuit. The panel found that the disclaimer on the video game packaging indicated that the features might not work for some users.

“Contrary to these representations, GTA Online was not available immediately to any purchasers,” the appellate court wrote. “The district court erred by failing to construe plaintiffs’ allegations that these representations were misleading in the light most favorable to plaintiffs, and by making the finding that the representations were not misleading.”

Further, the appellate court took issue with the fact that the plaintiffs were never allowed to file an amended complaint.

“The district court abused its discretion by denying plaintiffs leave to amend their complaint,” the panel wrote. “Leave to amend at least once is freely granted unless amendment would be futile.”

The appellate court remanded the Grand Theft Auto class action lawsuit back to the district court and instructed the district court to allow the plaintiffs to file an amended complaint.

The plaintiffs are represented by Jeffrey Lawrence of The Law Offices of Jeffrey R. Lawrence, Rex Sofonio of Sofonio & Associates and James R. Hawkins of James Hawkins PC.

The Grand Theft Auto V Class Action Lawsuit is Bruce McMahon, et al. v. Take-Two Interactive Software Inc., et al., Case No. 5:13-cv-02032, in the U.S. District Court for the Central District of California.

UPDATE: On Dec. 7, 2016, the makers of Grand Theft Auto V are taking another stab at evading a three-year-old false advertising class action lawsuit over access to GTA Online. In the current motion for dismissal, Take-Two Interactive argues the plaintiffs still fail to allege a plausible theory that they relied on the alleged misrepresentations in deciding to buy Grand Theft Auto V.

UPDATE 2: On Jan. 23, 2017, the plaintiffs in a class action lawsuit alleging that an online feature was not immediately available after they purchased Grand Theft Auto V asked a federal judge to keep their case alive, arguing that they relied on the representations about the feature when making their purchase.