A prominent Pokémon card grader is facing legal action as surging popularity in the Pokémon Trading Card Game collides with commercial pressures. PSA, operated by Collectors Universe, Inc. and Collectors Holdings, Inc., has been hit with a RICO class action lawsuit filed in Baltimore by plaintiff Nicholas Funk on behalf of a proposed nationwide class of consumers.

Quick Facts

  • Defendants: Collectors Universe, Inc. (PSA) and Collectors Holdings, Inc.
  • Plaintiff: Nicholas Funk, representing a proposed nationwide class of consumers.
  • Location: Filed in the state of Baltimore.
  • Core Allegation: Market manipulation, subjective grading, and selling "manufactured uncertainty."

Details of the Allegations Against PSA

The lawsuit targets the transparency and consistency of PSA's grading process. While PSA officially markets its services as objective, impartial, expert, and standardized, the complaint argues that grading outcomes are actually subjective, inconsistent, and financially conflicted to maximize revenue.

According to the complaint, PSA does not require prior professional grading experience, specialized training, or formal certification for its card graders, relying instead on internal training. The lawsuit further points to production quotas, short review windows, undisclosed changes to grading criteria, and the use of temporary contractors during high-volume periods as factors that undermine reliability.

The filing claims that graders rely heavily on an undisclosed "eye appeal" override defined not by objective physical condition criteria, but by market acceptance. Additionally, the lawsuit alleges that PSA manages top-tier GEM Mint 10 populations through ratio-based grading practices and heightened scrutiny on premium player cards to artificially preserve scarcity and encourage ongoing submission fees.

Current Status and Unknowns

The legal challenge compounds existing operational strain for the company. Amid surging interest in the Pokémon Trading Card Game and newer titles like One Piece, Riftbound, and Lorcana, PSA previously increased turnaround times across all tiers, temporarily closed lowest submission tiers, and invested hundreds of millions of dollars into new grading facilities to clear backlogs.

PSA has not yet issued a public response to the lawsuit. Because the complaint was recently filed as a civil action, none of the plaintiff's allegations have been tested or adjudicated in court.