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Microsoft Hit with Class Action Over XBox Points

Suit latest in a long line of points-related complaints

By Jon Hood
ConsumerAffairs.com

January 29, 2010

Lead plaintiff Samuel Lassoff, of Horsham, Pa., says an invoice he got earlier this month included charges for games that couldn't be successfully downloaded because of hardware problems. The charges weren't an accident, Lassoff says, but rather part of a Microsoft "scheme to unjustly enrich itself through [its] fraudulent handling of his account."

Even before Lassoff's suit, XBox points have been the subject of increasingly withering criticism, to the point that Microsoft is considering abandoning the system altogether. Gamers routinely kvetch that the system leaves users with leftover points that aren't enough to put toward the purchase of a new game.

Under the system, points are purchased with real currency, usually via a debit or credit card, and can be put toward the purchase of an xBox game or other downloadable media. The problem, according to disgruntled gamers, is that the number of points purchased rarely lines up with the number needed to buy a given item, so users are left with spare points that can't be put toward a subsequent purchase.

For those who aren't gamers or gearheads, an analogy may be in order. The quandary faced by XBox users is one seen all too often by users of mass transit. In 2007, for example, recalculated New York City subway fares added a bonus of $1.05 to every $7.00 fare card purchased. Rides cost $2.00 each. Thus, a straphanger who paid $7.00 ended up with an $8.05 card -- good for four rides and a leftover nickel. He then has to save up 20 cards worth $0.05 a piece until he has enough to trade in for a full ride.

In addition to this algebraic nightmare, users claim to have had their accounts hacked and points stolen, raising questions about the security of the "XBox Live Marketplace." These complaints and others have reportedly led Microsoft to consider letting the sun set on the points system, and have gamers pay for games and media directly with cash.

Lassoff says that, at the very least, "hundreds" of other XBox users have paid for games that never ended up on their consoles. He maintains that Microsoft was contractually obligated to provide "the complete, whole, and or actual digital goods and services purchased," and that it failed to warn him of "point fraud due to incomplete and or partial downloads." His suit includes counts for negligence, unjust enrichment, and unfair business practices.

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