Electronic Arts Inc. (EA:US) is close to resolving a customer lawsuit alleging the company’s exclusive deals with the National Football League drove up the price of its “Madden NFL” game, according to a court filing.
The second-largest U.S. video-game publisher reached “a settlement in principle” and intends to negotiate a definitive agreement within 45 days, lawyers for EA and Madden buyers said in a filing today in federal court in San Francisco.
An antitrust complaint filed on behalf of Madden buyers in 2008 alleged that EA made a series of unlawful agreements with the National Football League and other entities for exclusive rights to market NFL-branded interactive football software. The deals drove out competitors, enabling EA to charge 70 percent more for its flagship football video game “Madden NFL,” according to the complaint.
In 2010, U.S. District Judge Claudia Wilken in Oakland, California, certified the lawsuit as a class action, or group suit on behalf of anyone who bought Madden NFL, NCAA or Arena Football League software starting with a release date of 2005. EA denied the allegations in the lawsuit.
The settlement amount wasn’t disclosed in court filings. EA said in a Securities and Exchange Commission filing yesterday that it recognized “a $27 million expense related to a potential settlement of an ongoing litigation matter” in the fourth quarter of fiscal 2012. The filing didn’t specify the legal matter.
Jeff Brown, an Electronic Arts spokesman, and Shana Scarlett, an attorney for Madden buyers, didn’t immediately respond to voice-mail messages today seeking comment on the accord.
The case is Pecover v. Electronic Arts, 08-2820, U.S. District Court, Northern District of California (Oakland).
To contact the reporter on this story: Karen Gullo in San Francisco at email@example.com.
To contact the editor responsible for this story: Michael Hytha at firstname.lastname@example.org.