• Download a copy of the lawsuit here. 

A proposed class action lawsuit filed in the US District Court for the Western District of Washington alleges that Microsoft entered into an unlawful agreement with Valve requiring “price parity” between games sold on the Microsoft Store and Steam, amounting to a horizontal price-fixing conspiracy. The complaint, filed on May 31, 2026, claims Microsoft “chose to join Valve’s cartel” rather than compete with Steam, resulting in higher prices, reduced choice, and lower quality for consumers. 

The suit seeks damages and injunctive relief under Sections 1 and 2 of the Sherman Act, the Clayton Act, and the Washington Consumer Protection Act on behalf of US consumers who purchased PC games through Steam or the Microsoft Store.

What are the allegations?

• Plaintiffs allege Microsoft and Valve entered into a “horizontal price-fixing agreement” through a 2011 distribution contract.
• The complaint cites Valve’s own court filings, which stated that an arbitrator found a clause in the agreement to be an unlawful “horizontal price-fixing agreement“.
• According to the lawsuit, the arbitrator also described the clause as a “price parity requirement“.
• Plaintiffs allege Microsoft and Valve conspired “with the specific goal of not competing on price”.

How did the alleged price parity work?

• The complaint alleges that if Microsoft lowered the price of a game on its own store, it also had to lower the price on Steam.
• It cites an internal Microsoft communication stating that the Steam publishing agreement historically required “product and price parity“.
• Another Microsoft employee allegedly wrote that Steam required publishers not to “undercut them once you release on Steam“.

What does the lawsuit say about competition?

• Plaintiffs allege Microsoft and Valve agreed not to compete on PC game pricing, content, and release timing.
• The complaint states that Microsoft “actively impeded price competition in the PC game market”.
• It further alleges that the companies “honored their agreements not to compete on PC game content”.
• According to the lawsuit, these arrangements established “uniformity across the market” and prevented competition on quality and content.

What role does Steam play?

• The lawsuit alleges Steam controls roughly 75% of the PC game distribution market.
• It describes Steam as the largest PC game distribution platform in the United States.
• Plaintiffs claim Valve and Microsoft together control “at least 80%” of PC game distribution in the US.

Harms claimed: 

• Plaintiffs allege consumers paid “artificially inflated prices” for PC games.
• The complaint claims consumers lost the benefits of competition, including “lower prices, increased output, unique content selection, and higher quality”.
• It further alleges Microsoft and Valve concealed the agreement for years.
• According to the lawsuit, the alleged price-fixing findings became public only after Valve referenced them in court filings on May 28, 2026.

Why does this matter? This lawsuit does not emerge in isolation. For years, Valve has faced antitrust challenges centred on allegations that Steam’s price parity requirements prevented publishers from offering cheaper prices on rival stores. US courts have already certified a class action brought by over 32,000 game developers alleging that Valve used pricing and content parity obligations to suppress competition in PC game distribution.

What makes this case different, however, is that it targets Microsoft itself. If the plaintiffs prove that Microsoft agreed to Steam’s parity requirements rather than merely complying with them, the dispute could shift from questions about a dominant platform’s conduct to allegations of a horizontal agreement between competitors, traditionally considered among the most serious violations of U.S. antitrust law.

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