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Sony fined $3.5 million for issuing 'misleading' refund advice to PlayStation users

Sony Interactive Entertainment Europe has been ordered to pay $3.5 million in penalties by the Federal Court of Australia for making "false and misleading" claims to PlayStation users with regards to digital refunds.

Sony Interactive Entertainment Europe has been ordered to pay $3.5 million in penalties by the Federal Court of Australia for making "false and misleading" claims to PlayStation users with regards to digital refunds.

The Australian Competition & Consumer Commission (ACCC) instituted proceedings against Sony in May 2019 for breaching Australian Consumer Law (ACL) by refusing to issue refunds to four consumers who claimed the digital games they had purchased were faulty. 

"Sony Europe made misleading representations to four consumers who believed they had purchased faulty PlayStation games," reads an ACCC statement. "This occurred when Sony’s customer service representatives told them over the phone Sony Europe was not required to refund the game once it had been downloaded, or if 14 days had passed since it was purchased."

The Federal Court also found that Sony breached the ACL by telling one consumer that it didn't have to issue a refund unless it had been authorized by the game's developer, and by explaining to another that it could offer a refund in virtual 'PlayStation currency' instead of cash. 

"Consumer guarantee rights do not expire after a digital product has been downloaded and certainly do not disappear after 14 days or any other arbitrary date claimed by a game store or developer," explained ACCC chair, Rod Sims.

"What Sony told these consumers was false and does not reflect the consumer guarantee rights afforded to Australian consumers under the Australian Consumer Law. Consumers can obtain a repair, replacement or refund directly for products with a major fault from sellers and cannot simply be sent to a product developer.

"Refunds under the consumer guarantees must also be given in cash or money transfer if the consumer originally paid in one of those ways, unless the consumer chooses to receive store credit."

In short, the Federal Court agreed with the ACCC that between October 2017 and May 2019, Sony Europe's Terms of Service implied that users did not have consumer guarantee rights "regarding the quality, functionality, completeness, accuracy or performance of their purchased digital games."

"Consumers who buy digital products online have exactly the same rights as they would if they made the purchase at a physical store," added Sims. "No matter where in the world a company has its headquarters, if it is selling to Australian consumers, the Australian Consumer Law applies."

Sony Europe has now admitted liability and made joint submissions to the Federal Court with the ACCC, and will be contributing to the ACCC's legal costs.

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