The Supreme Court of California was on James “PhantomL0rd” Varga’s side yesterday.
The court case between Varga and Twitch began last month when the streamer sued the platform over a breach of contract that allegedly caused severe financial damage and character misrepresentation. Judge Curtis Karnow ruled that the liability clause in the contract, which capped the amount of money Varga could win in a lawsuit with Twitch to $50,000, was “overly harsh,” “unfairly one-sided,” and “unconscionable.”
“Unconscionability has two aspects,” the judge said. “‘Circumstances of contract negotiation… focusing on oppression or surprise due to unequal bargaining power,’ and unconscionability which ‘pertains to the fairness of an agreement’s actual terms… of whether they are overly harsh or one-sided.’”
Whether Varga had unequal bargaining power or the terms of the agreement are overly harsh, Judge Karnow decided that there was a disparity in legal education since the streamer didn’t use an attorney during the signing of the contract.
Judge Karnow did criticize Varga’s failure to review the agreement, however. The judge claimed that, though the language might have been obscure in some areas, the details of the contract shouldn’t have been a “surprise” and the streamer could have negotiated further before signing.
Varga is suing the streaming platform for deleting his Twitch channel following a controversy that involved skin gambling in CS:GO. Journalist Richard Lewis initially reported that Varga secretly owned a website that allowed players to gamble on weapon skins and manipulated betting results on his stream.
Twitch’s cross-complaint argues that Varga “breached his contractual obligations to Twitch and made material misrepresentations to defraud Twitch and its users.”
Judge Karnow will set a case management conference to determine the next steps in the case.
