Pokemon GO is presently available in 26 different countries and plans to expand further. Its innovative entertainment experience has captured the minds of many. It is evident the game has caused a lot of attention, but by signing up to play, are you subjecting yourself to risk? Below, we put Pokemon GO’s Terms and Conditions and Privacy Policy under the microscope.

What is Pokemon Go and Who Established It?

Five years ago, Niantic Inc. set out to change how people interact with games and the real world – they called it “real world gaming”.  Niantic’s most recent venture was to create “Pokemon GO” in partnership with Nintendo and The Pokemon Company (together, Pokemon GO or Niantic).

Pokemon GO is an augmented reality game that caters to your smartphone. It sends users out into the real world to capture Pokemon, and this crossover between the game and reality has sent people into a frenzy.

5 Clicks Away from Becoming a Pokemon GO Trainer

When you sign up to play, you agree to the Pokemon GO terms and conditions.

First, you are prompted through four different screens which ask whether you will allow Pokemon GO to:

  • Access your location;
  • Access photos, media and files on your phone;
  • Access your contact information; and
  • Take pictures and record videos from your device.

After clicking through these the above screens, you are provided with the ‘terms of service’.  You have the option to scroll through these terms and accept or decline. In summary, it takes about five clicks to join Pokemon GO successfully.

Pokemon GO Terms and Conditions: Under the Microscope

The terms of service (the Terms) is light reading at 6, 600 words. The Terms refer you to two other external documents (the trainer guidelines and the privacy policy – these documents are available for your review on Niantic’s website).

AgeYou must be at least 13 years old to sign up without parental approval.  Otherwise, you will need a parent or legal guardian to approve your use of the game. The Terms, Trainer Guidelines and Privacy Policy, will bind the parent or guardian. Interestingly, upon signup, the app does not ask for your age, and so it’s unclear how it determines whether you are of age.

Changes to Terms of Services: The Terms state that Niantic may modify its Terms at any time. If they make changes, the Niantic will let you know either by:

  • Posting the new terms on Niantic’s website; or
  • Posting on the application itself; or
  • Through “other communication”.

This clause is not uncommon – many standard form contracts in Australia include this term. They are typically used to improve the efficiency of a company where it is not suitable to make hundreds of individualised contracts. For example, we have seen them in gym contracts, Facebook, Airbnb and Uber.

Arbitration Clause: In bold capitals, Pokemon GO asks that you waive your rights to a trial by jury or take part in a class action suit against the organisation. Your avenue for dispute exists in individual arbitration.

The arbitration procedure is set out in the Terms. According to the Terms, the American Arbitration Association following the Commercial Arbitration Rules and the Supplementary Procedures for Consumer-Related Disputes will administer the arbitration. The Federal Arbitration Act governs interpretation and enforcement of the term.

Interestingly, the arbitration will be conducted in the country you reside. Further, if you are not happy with the clause you have the option to opt out by completing the “Arbitration Opt-out Notice” with 30 days of signing up.

Uber’s Anti-Trial Clause: Pokemon GO’s arbitration clause is not unique, and startups such as Uber and Airbnb have comparable clauses (although they continue to refine theirs and update accordingly).

The current arbitration clause in Uber’s terms and conditions is remarkably similar to that of Pokemon GO. By opting into the Uber app, users agree that binding arbitration will settle any dispute or claim against Uber. Further, Uber users agree that they will not join class action proceedings against Uber.

In December 2015, an Uber user filed a class-action lawsuit against Mr Travis Kalanick, Uber’s founder and CEO. Mr Kalanick attempted to have the suit dismissed. In failing to have the lawsuit dismissed, he subsequently had Uber join the proceedings. Uber then asked the Court to force the trial into binding arbitration, as stated in Uber’s terms and conditions.

The Court denied Uber’s request to force the lawsuit to move to arbitration. In denying Uber’s request, the court questioned if Uber users agreed to the company’s terms and conditions at all. Customers gave evidence that showed they did not physically agree to any terms and conditions. Rather, Uber provided users with an acceptance screen that stated, “by creating an Uber account, you agree to the terms of service and privacy policy”.

Termination Clause: Pokemon GO has a strict termination clause. The clause expressly states that Niantic may cancel, suspend or terminate a user’s account and access to any trading items, virtual money and virtual goods in its “sole discretion and without prior notice”.

Effectively, this means that you waive the option to receive money or other compensation for any unused virtual money and goods when your account is closed (regardless of whether you did so involuntary).

Pokemon GO’s Privacy Policy

The Pokemon GO Privacy Policy (the Policy) deals with how Pokemon GO collects, uses and discloses information obtained from users. According to the Policy, Pokemon GO’s primary purpose in collecting your information is to provide and improve your use of the game.

Disclosure of User Information: In its Policy, Pokemon states it will not share any of your data apart from the following situations:

  1. Sharing with The Pokemon Company and The Pokemon Company International: Pokemon GO will exchange information to these organisations in the event of any errors or problems found.
  2. Sharing with services providers: Pokemon GO will share information in the event they engage a third party to administer and provide services.
  3. Sharing with third parties: Pokemon GO will share non-identifying information with third parties for research and analysis, demographic profiling and other similar purposes.
  4. Sharing in connection with business transactions: Pokemon Go will exchange information in the event another company acquires Pokemon GO.
  5. Sharing to protect the business or protect others: Pokemon GO will share information to cooperate with the government, law enforcement officials or private parties to enforce and comply with the law.

Keeping User Information

If you deactivate your account, Niantic will keep your information for a reasonable period for backup, archival and audit purposes. It is also of note that personal information is stored in the United States.

Pokemon GO Trainer Guidelines

The Trainer Guidelines (“the Guidelines”) are there to ensure users are respectful to the community and other players. If a user breaches the Guidelines, Pokemon GO may issue a warning, suspend your account or terminate the account altogether.

The Effect of a Binding Contract

When you enter into a contract, you are bound by its terms. The terms can affect your actions during and sometimes after the contract period has seemingly ended. The only time an agreement will not be binding is if it is against the law.

‘Unfair’ terms can be severed (i.e. removed) from the contract, leaving the remainder intact. If the unfair term is a significant part of the agreement, it may void the whole contract.

A term is ‘unfair’ when there is ‘significant imbalance’ between parties, and it goes further than protecting the “legitimate interest” of the party relying on it and when there is no notice or appropriate transparency.

Any business that offers services to consumers in Australia must comply with the Australian Consumer Law (Cth) (ACL). Resultingly, companies like Niantic must comply with the ACL’s ‘unfair terms’ provisions. Under the ACL, these provisions attach to ‘standard form contracts’.  Standard form contracts are unilateral contracts like Pokemon GO’s Terms.

Key Takeaways

By signing up to Pokemon GO you are signing up to some novel terms and conditions. Unlike the above example with Uber, Pokemon GO does provide you with considerable notice before you enter into a binding contract. Remember the five clicks? The practical lesson is that you should never be a Charmander when you are given the tools to be a Charizard – read the fine print.

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Questions? Get in touch with our online law team on 1300 544 755.

Esther Mistarz

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