Game grading firm Wata hit with lawsuit for “manipulating” retro market
Video game grading firm Wata has been accused of “manipulating” the retro gaming market in a new class-action lawsuit filed this week.
As reported by VGC yesterday (May 13), the Central District of California filed the lawsuit against Wata on May 10 this week. The lawsuit is on behalf of all US residents who purchased games from Wata, which is estimated to be over 10,000 people.
According to the lawsuit, Wata has been “engaging in affirmative acts to manipulate the retro video game market, engaging in unfair business practices, engaging in false advertising, making false statements about the turnaround times for grading services, and failing to disclose material delays to customers.”
This lawsuit follows an almost hour-long investigation posted to YouTube by Karl Jobst last year. The report alleged that Wata and auction company Heritage Auctions worked together to artificially inflate the retro games market, which both companies categorically denied.
Wata and Heritage have been accused of inflating prices in the lawsuit as well, as both’s promotional materials state the retro game market and its prices are likely to increase.
Wata and Heritage take a percentage of a graded game’s market value, with an example given that states a $1million (around £820,000) grading will net Wata $20,000 (around £16,000). Meanwhile, Heritage is said to take cuts of around 20 per cent of a buyer’s premium and 5 per cent from the seller.
Plaintiffs in the lawsuit also allege that Wata has promised to have games graded and returned within 15 business days, when the process actually took several months. Wata is also accused of having its employees sell their own graded games, which breaches the company’s own fraud and conflict of interest policies.
“The increased value of the games allowed Wata to charge even more for its grading services since prices were tied to values. Yet, the relationship between Wata and Heritage Auctions was still unknown to collectors,” adds the lawsuit.
Last year Wata graded a sealed copy of Super Mario 64, which ended up selling for a record £1,124,000 ($1,560,000 USD). It then graded a sealed copy of 2011’s Skyrim, which sold for £433.26 ($600 USD).
In other news, Square Enix has said it wants to establish new development studios, soon after announcing it will sell most of its western development arm.
For all the latest Games News Click Here