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Judge OKs Second Life Virtual Money Class Action Settlement

By Anne Bucher


Second Life class action lawsuit settlementAccording to a class action settlement that was recently approved by a California magistrate judge, Linden Research Inc. will pay a mixture of real and virtual money to Second Life gamers who claim they were deceived about their “ownership” rights in the virtual world.

Second Life is a virtual game in which users create characters called avatars that can meet other virtual residents, socialize, run businesses and trade services. Users buy and sell items with virtual money known as “lindens,” and pay monthly “tier fees,” which are similar to property taxes, to Linden Research.


Carl Evans, Donald Spencer, Valerie Spencer and Cindy Carter initially filed the class action lawsuit against Linden Research and its former CEO Phillip Rosedale in 2010, accusing the company of lying to users about the nature of “ownership” in the virtual world. They claim they purchased virtual items and/or virtual land but were not compensated for the value of the items or land after their accounts were suspended or terminated.


The plaintiffs filed a second amended class action lawsuit in Feb. 2012, which included Naomi Hemingway as a plaintiff. In this amended complaint, they accused Linden Research of making false representations about the ownership of virtual property and said that the company wrongly confiscated virtual property from them.


After engaging in mediation, the parties agreed to a tentative class action settlement in March 2013 and executed a settlement agreement on May 17, 2013. Upon the court’s request, the agreement underwent a series of revisions before U.S. Magistrate Judge Donna Ryu granted preliminary approval to the class action settlement on Oct. 25. Under this revised settlement agreement, the Class Members include “all persons whose assets, including virtual items, virtual land, and/or currency in lindens and/or U.S. dollars, have been deliberately and intentionally converted by Defendant Linden’s suspension or closure of their Second Life accounts on or after April 16, 2008.”


Under the terms of the class action settlement, Linden Research has agreed to return up to 100 percent of the U.S. dollar balances in the Class Members’ accounts to their PayPal accounts within 10 days of establishing the validity of the claim. Linden will also return up to 100 percent of the balance of linden dollars by converting them to U.S. dollars and will waive Second Life’s commissions on the currency exchange. Linden Research also agreed to pay for virtual property and virtual items once the validity of each claim is determined.


The Class Administrator will have up to 60 days to notify Class Members of this class action settlement by email. The Settlement Administrator will also establish a website with information and updates about the class action settlement.


A hearing on the final approval of the class action settlement has been scheduled for Feb. 27, 2014.


Further information about the Second Life Virtual Money Class Action Settlement was not immediately available. Keep checking Top Class Actions for details on how to file a claim, or sign up for free settlement alerts below.


The plaintiffs are represented by Jason Archinaco and Robert Bracken of Archinaco/Bracken LLC and Michael Aschenbrener of Aschenbrener Law PC.


The Second Life Virtual Money Class Action Lawsuit is Evans, et al. v. Linden Research Inc., et al., Case No. 4:11-cv-01078-DMR, in the U.S. District Court for the Northern District of California.



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1 Comment

  • Mike November 6, 2013

    Great to see Linden Research finally take sme responsibility. For years they have been selling virtual land and goods and then just converting that at will and claiming that you bought nothing. this was long overdue.

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