Both suits were filed with the U.S. District Court for the Northern District of California and both target EA's use of the controversial SecuROM digital rights management (DRM) software on the company's PC games.

In the first case, a Pennsylvania man, Richard Eldridge, alleges that the Spore Creature Creator Free Trial  Edition secretly installed SecuROM on his PC, a violation that Eldridge terms "deceptive and unlawful." From the suit:

Quote:

The inclusion of undisclosed, secretly installed DRM protection measures with a program that was freely distributed constitutes a major violation of computer owners' absolute right to control what does and what does not get loaded onto their computers, and how their computers shall be used... [SecuROM] cannot be completely uninstalled. Once installed it becomes a permanent part of the consumer's software portfolio... EA's EULA for Spore Creature Creator Free Trial Edition makes utterly no mention of any Technical Protection Measures, DRM technology, or SecuROM whatsoever...

You can check out this news and another suit listed by going here.

You can discuss this news by visiting our forums here!

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As we found out over the weekend from this source that Circuit City wasn't getting any new shipments of Sony goods, today in a press release Circuit City a Virginia based company announced store closings and layoffs. This is indeed a sure sign of how the US economy is failing and that people are not buying. Whats this mean for gaming? Well I'm sure it will hurt those that rely on Circuit City to get their latest PC Games.

-- Company Plans to Close 155 Stores, Further Reduce New Store Openings and Renegotiate Certain Leases --
-- Company Announces Ongoing Evaluation of Additional Cost Reduction Initiatives and Is Considering All Options and Alternatives to Restructure its Business --

RICHMOND, Va., Nov 03, 2008 /PRNewswire-FirstCall via COMTEX News Network/ -- Circuit City Stores, Inc. (NYSE: CC) today provided an update on its liquidity position and its previously announced ongoing comprehensive business review. Due in part to its deteriorating liquidity position and the continued weak macroeconomic environment, the company has decided to take certain restructuring actions immediately, including closing 155 domestic segment stores, reducing future store openings and aggressively renegotiating certain leases. The company also is considering all available options and alternatives to restructure its business.

Business and Liquidity Update

Over the past several weeks, a number of factors have impacted severely the company's liquidity position. These factors include the following:

-- Waning consumer confidence and a significantly weakened retail environment have impacted negatively the company's sales and gross profit margin rate to a greater degree than management had anticipated previously.

-- Following the company's second quarter results announcement, the company's liquidity position and the sharply worsened overall economic environment led some of Circuit City's vendors to take restrictive actions with respect to payment terms and the credit they make available to the company. Additionally, the recent disruption in the financial markets has contributed to certain of the company's vendors experiencing insurmountable challenges with obtaining credit insurance for the company's purchases. As a result of this and other considerations, certain of the company's vendors have set more restrictive payment terms than in previous quarters, including in some cases requiring payment before shipment. Vendors also have limited the credit available to the company for purchases, including in some cases not providing customary increases in credit lines for holiday purchases. While management is working diligently to secure the support of its vendors and believes it has maintained good relationships with these important partners, the current mix of terms and credit availability is becoming unmanageable for the company.

-- To date, the company has been unable to collect an income tax refund of approximately $80 million that the company believes it is owed from the federal government.

-- Due primarily to the weakened economic environment and its potential impact on the timing of sales of the company's inventory and costs and expenses associated with such sales, a recent third-party appraisal conducted for the company's asset-based credit facility resulted in a reduction of the estimated net orderly liquidation value of the company's inventory. This valuation adjustment was made despite the mix of merchandise remaining consistent with the previous appraisal in November 2007. This reduction has led to a lower borrowing base and reduced availability for the current period compared with what the company had expected previously.

 

You can read the whole press release by visiting here.

You can discuss this news on our forums by going here.

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